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Performance Management System

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A well defined PMS System

A well defined PMS System


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  • 1. PMS By : Vipul Saxena 1 MANAGEMENT SYSTEM
  • 2. 2 Doing a Job: Doing a job is completing a given Task/Activity/Assignment/ Project / Work . Doing a job/ Task/Activity/Assignment/ Project / Work without Specific & Measurable Objective without any time limit /Criteria without quality & accountability is not a Performance. But Doing the same job/ Task/Activity/Assignment/ Project / Work with… DIFFERENCE BETWEEN DOING A JOB & PERFORMANCE SPECIFIC MEASURABLE OBJECTIVE TIME QUALITY ACCOUNTABILITY& in with & PERFORMANCE
  • 3. DEFINITION Performance refers to the degree of accomplishment of the tasks that make up an individual's job. It indicates how well an individual is fulfilling the job demands. Performance appraisal is a method of evaluating the behavior of employees at work place, quantitatively and qualitatively. Performance Management System is an organization - wide management program that provides a structured approach to:  Establish a shared understanding of what is to be achieved and how it is to be achieved (Planning Performance)  Communicate & Monitoring business strategy (Monitoring Performance)  Measure and motivate performance -organizational and individual (Evaluating Performance)  Facilitate management of self and others (recognition) Performance Management System is based on the set & agreed role requirements (JD), objectives (KRA) and performance improvement and personal development plans. 3
  • 4. AIM OF PMS  The overall aim of performance management is to establish a high performance culture  It’s key purpose is to focus on people doing the right things by achieving goal clarity.  Performance management is about aligning individual objectives to organizational objectives  It provides for expectations to be defined and agreed in terms of role responsibilities and accountabilities (expected to do), skills (expected to have) and behaviors (expected to be).  The aim is to develop the capacity of people to meet and exceed expectations and to achieve individual objective & organization goal . 4
  • 5. WHAT PMS Includes..???  Defining Role & Responsibility: with the help of Job description & KRA employee role & Responsibility are define.  A Work plan – A document that describes the work to be completed by an employee within the performance cycle, the performance expected, and how the performance will be measured.  Performance appraisal – A confidential document that includes the employee’s performance expectations, a summary of the employee’s actual performance relative to those expectations, an overall rating of the employee’s performance, and the supervisor’s and employee’s signatures.  Performance documentation – A letter, memo, completed form, or note on which the supervisor indicates the extent to which the employee is currently meeting expectations and provides evidence to support that conclusion.  Fair appraisal – Appraising employees in a manner that accurately reflects how they performed relative to the expectations defined in their work plan and in a manner that is not influenced by factors irrelevant to performance.  A Corrective action plan – A short-term action plan that is initiated when an employee’s performance fails to meet expectations. Its purpose is to achieve an improvement in performance.  Individual development plan – An action plan for enhancing an employee’s level of performance in order to excel in the current job or prepare for new responsibilities. 5
  • 6. WHY MEASURE PERFORMANCE ??? What you cannot Measure you cannot Improve. If you cannot Manage/Improve you cannot grow. Measurement helps in objectively differentiating between performers and non performers. 6 What you cannot Measure you cannot Manage.
  • 7. WHY PMS..???  To helps the management to take decision about the salary increase of an employee.  To helps in improving the quality of an employee in job performance.  To provide adequate facilities for effective performance.  To minimizes the communication gap between the employer and employee.  To identify the training needs of an employee  To take the decision of promoting or discharging an employee from the job  To identify & transfer a person who is misfit for a job to the right place.  The grievances of an employee are eliminated  Increased job satisfaction of an employee  Helps to improve the employer and employee relationship. 7
  • 8. WHAT PMS CONSISTS..??? A procedure for retaining talent pool of employee. 8 A process for measuring employee performance. A process for Maintaining ongoing performance dialogue, A Process for recognizing employee contribution A procedure for addressing employee performance that falls below expectations A procedure for encouraging and facilitating employee development. A procedure for resolving performance pay disputes.
  • 9. IMPORTANCE OF PMS  Enables a business to sustain profitability and performance by linking the employees pay to competency and contribution.  It provides opportunities for personal development and career growth  It brings all the employees under a single strategic umbrella.  Most importantly, it gives supervisors and subordinates an equal opportunity to express themselves under structured conditions 9
  • 10. Setting Objective (Individual, Department & Organization) Increased performance Creating Competitive Manpower Identifying Manpower Strength & Weakness Pay for performance Retention Increased Employee involvement PMS Helps in…. Identify Training & Development needs Transparency in appraisal process
  • 11. PMS OUTLINE Performance Standards Performance appraisal Performance planning performance monitoring Performance Evaluation Recognition Performance Standards are the benchmark against which performance is measured Evaluation of actual against desired performance Performance Management System 11
  • 12. Shaping the Bell Right BELL CURVE 12
  • 13. Bell Curve…1 The Bell Curve is better known as the Forced Ranking Appraisal Systems. Forced ranking has been defined as “a workforce management tool based on the premise that in order to develop and thrive, a company must identify its best and worst performers, then nurture the former and rehabilitate and/ or discard the latter”.  It categorizes people based on their performance, rewards or penalizes them accordingly.  The entire workforce is segregated as the top performers, medium performers and the poor performers. Other Name : Normal Distribution Curve , Vitality Curve , UP or OUT Curve. 13
  • 14. Bell Curve….2 Evaluation Ratings A B C D E Bell curve distribution of employee 10% 30% 50% 8% 2% 14 0% 10% 20% 30% 40% 50% 60% 0 1 2 3 4 5 6 Ratings Bell Curve A B C D E No. of % of employees
  • 15. Grading the curve  10 percent are rated as ‘Exceptional contributor’ (A)  30 percent as the ‘Significant Contributor’ (B)  50 percent as the ‘Contributor ‘ (C)  8 percent as ‘Partial Contributor’ (D)  2 Percent as ‘Non –Contributor’ (E)E-2% D-8% C-50% B-30% A -10% The employee force is ranked into a 10-30-50-8-2(A-B-C-D-E) bucket. 15
  • 16. Advantages of bell Curve in PMS  It brings objectivity to the PMS process  It helps in normalization of the PMS process  It guides appraisers on how to follow an uniform rating process/pattern  It helps management in planned attrition and in predicting promotions/job enlargements/job enrichments/rewards etc.  It systematically identifies high performers for commensurate rewards and identifies Avg/low/weak performers for training.  On a predictive index, it provides a bird's eye view of the uniform, systematic performance patterns across grades/levels/functions in the organization. 16
  • 17. Benefits The purpose of PMS is enforced across the organization by using Bell Curve As follows;  The Employee, who are ‘Exceptional Contributor’ are motivated to keep improving themselves as their contribution is recognized.  The Employee, who are ‘Significant Contributor’ are provided with opportunities to enhance themselves .  The majority of the employee, who are classified as Contributor , are provided with various training modules and other tools of improvement.  The partial contributor & Non Contributor are warned that they need to get their act together and thus, the productivity of the organization slowly improves Accountability. 17
  • 18. PMS Process Step I: Identify list of employee eligible for PMS as per policy. Step II: Prepare bell curve list for HOD’s across all locations. Step III: Send PMS email as well as bell curve to all HOD’s with last date to submit the rating & PMS Form of all the employee to HR department. Step IV: After receiving data from all locations comply all the data and records. Step V : Find the variation of the bell curve standard VS actual Step VI: If any variations send back the data to HOD for correction & get back corrected list as per standard. Step VII: Comply all the data and arrange meeting with top management regarding strategy on increment ,Promotion and actual payout Step IX: Freezing the payout & releasing the actual pay 18
  • 19. PMS FORM Below officer level 19 Above officer level
  • 20. Above Officer Level PMS Form The PMS form consist the following ; I. Employment details II. KRA (weightage-70% ,Expected VS Actual) III. Behavioral competency (Weightage -30%) IV. Final score & Rating V. Career aspirations (to be filled by appraisee) VI. Training & Development plan and Promotion Recommendations 20
  • 21. Employment details 21 Above Officer Level PMS Form
  • 22. KRA…1 22 Above Officer Level PMS Form Worked out sample
  • 23. KRA….2 PART –I (Defining the Objectives) KRA Objective s, these are the objective define from DOJ for new joiner by their HOD & for existing employee JD & KRA are define from time to time by their respective HOD. KRA Objective are measure against define target in unit of measurement (qty.,Nos, %,Date etc) set by employee & their respective HOD. These target are assign weightage to be achieved . Part –II (Appraisee) Achievement against the target ,this column give details with supporting & evidence how much target has been achieved by the employee. Appraisee rating : In this column employee rate him/her self against his own performance Remarks : Employee write his/her remarks for achieving or under achieving the set target. 23 Above Officer Level PMS Form
  • 24. KRA….3 Part –III ( Appraiser & Reviewer) Appraiser Rating : in this column immediate superior/ supervisor to which employee is reporting data to day activity gives his feedback in terms of % out of 100 against the appraise rating on set KRA. Reviewer Rating : In this column Head of Department gives his/her feedback on set KRA in % out of 100. Average rating of appraiser & reviewer: This column the average of the appraiser & Reviewer rating. Final Score : This column give the calculation final score calculate as follows. (Weightage * Avg of Appraiser & reviewer rating )% 24 Above Officer Level PMS Form
  • 25. KRA GUIDELINES  KRA should be SMART ( Specific, Measurable, Achievable, Realistic, Time bound )  A maximum of 10 and a minimum of 5 KRAs will need to be considered for goal setting process for each individual  Appraiser to assign each KRA to a weightage representing its impact / importance / time spent  Sum of all the weightages should be 100  Appraiser needs to attach reports / MIS based on which Appraisee has been evaluated  Appraiser and Reviewer rating shall be in Achievement % against Target  Final Score is the average % of both Appraiser & Reviewer X Weightage 25 Above Officer Level PMS Form
  • 26. Behavioral Competency…1 26Above Officer Level PMS FormWorked out sample
  • 27. Behavioral Competency…2 Competency name : This column represent 10 behavioral factors against which employee competency is measured . Theses factors remain same for all the employee. Rating by Appraisee : In this column employee gives rating to him / her self out of 10 against each competency . Rating by Reviewer : In this column Head of Department gives his/her feedback on each competency by rating each competency out of 10. Average rating of appraiser & reviewer: In this column gives the average of the appraiser & Reviewer rating. 27 Above Officer Level PMS Form
  • 28. Final performance score & rating  Overall Competency Score : 30% of Overall Competency Rating = 30% X competency score = ……  Overall KRA Score: 70% of Overall KRA Score = 70% X KRA score = ………..  FINAL RATING : = Overall KRA Score + Overall Competency Score = …………  FINAL PERFORMANCE RATING = ……… Grades PMS Score Category A Above 95% Exceptional Contributor B 81-95 Significant Contributor C 71-80 Contributor D 61-70 Partial Contributor E Below 60 % Non Contributor Above Officer Level PMS Form
  • 29. Career aspirations This section of the form ask for information from employee regarding his/her career aspirations and the job he/she would like to move in the near future. Here appraisee also has an opportunity to write his/her training needs along with any other concern/issues/suggestions appraisee like his/her immediate superiors/HOD to be aware of. 29 Above Officer Level PMS Form
  • 30. Training & Development plan and Promotion Recommendations….1 30 Above Officer Level PMS Form
  • 31. Training & Development plan and Promotion Recommendations….2 Training & Development plan : Here appraiser and reviewer gives training recommendation for appraisee. Which are taken as inputs for training need identification (TNI) for the preparation of training calendar. Promotion recommendation : Here promotion recommendation is given by appraiser & reviewer as per policy. Salary correction : Remarks for salary correction are given by appraiser & reviewer where applicable as per policy. 31 Above Officer Level PMS Form
  • 32. Below officer level PMS form Below officer level PMS form consist the following ; I. Employment details II. Superior assessment form based on job orientation 1. Job output 2. Job quality 3. Timeliness In this only appraiser & reviewer gives the rating . The scale of appraisal is from 1 to 5 IIII. Behavioral attributes Hear appraiser & review both gives their rating from scale of 1 to 5 32
  • 33. Below officer level PMS form….2 IV. Final rating :Final rating is calculated from marks scored /total weightage V. Training need identification - training recommendation for appraisee is given by appraiser & reviewer VI. Potential appraisal –Here a few questions are there which need to be answer by appraiser & reviewer on potential of the appraisee i.e. readiness & willingness of apraisee to take up higher responsibility in near future VII. at the end Promotion & salary correction Recommendations by appraiser & reviewer are also taken as per policy. 33
  • 34. Thank you 34