PERFORMANCE & COMPENSATION MGT
CHAPTER 2: THE PERFORMANCE
Shirley Angie Sitimin
During the Presentation
Offer ideas & suggestions
Where Performance Mgt
Definition of PMP
Purposes of PMP
Manager in PMP
Supervisor & Employee
Various Diagram of PMP
•Challenges of PMP
How can I
How are we
What is our job?
Does anybody care?
How am I dooing?
What is my job?
Source: Roger D’Aprix
This is a pyramid showing some of the key questions
employees of organization ask to employer.
Often employees do not know what are expected from
A fundamental step in performance management is
communicating job expectations. Absent of clear
expectations, employees do not have the required tools
to perform their job functions.
Roger D'Aprix (2008) has identifies six key questions
employees need answered by their boss in order to
perform their job effectively.
PROCESS (PMP) DEFINITION
A continuous negotiation process that calls for effective
communication (Acuff, 2008).
Align employee's goals & to those of the organization (
PMP is defined as a continuous process where supervisors
and employees work together to establish objectives,
monitor progress toward these objectives and assess results.
With this process, employees receive regular feedback and
coaching which is a vital development process for all
employees (KSU, 2009).
Armstrong & Baron (2005) emphasized that PMP is a
strategy which relates to every activity of organization and
its implementation depends on organizational context and
can differ from organization to organization.
An on going cycle that underscores the need for supervisors
& employees to work together in determining the
organization & employee's goals.
A cycle with discussions varying year to year based on
changing objectives ( Raymond, 2006).
PURPOSES OF PMP
To develop people & improve performance
Allows individuals to know what is expected of them by the
organisation they work in and so they know what they need
to do to help the organisation to be a success and for them to
participate towards that success.
To provide honest & accurate formal evaluations
PMP purpose is to allow for a two way feedback
between supervisor and employee to aim at supporting
rewards or punishment for performance practices.
To drive capability development. It is typically designed
to help employees understand what they need to learn
and how they need to learn it.
MANAGER IN PMP
Take an active role in the process
Set realistic goals that aligned with the company
Measure result objectively
Identify needs & resources for employees
Responsible to support the process throughout the
RESPONSIBILITIES OF SUPERVISOR
& EMPLOYEE IN PMP
Provide on going performance feedback
Make clear company direction
Shared accountability. supervisor needs to provide open,
honest and constructive feedback to employee on their
Use a variety of methods and tools when monitoring and
giving feedback about employee's performance
To assist the employee throughout the appraisal period in
improving aspects of performance identified as needing
1. To actively giving inputs
2. Discuss any concerns and questions about any part of their
job or the performance management process with his or her
3. Responsible for continuous self-assessment
4. Responsible to take personal ownership for development
by identifying and participating in career development
5. Employee need to mutually agree on performance
expectations and competencies during the developmental
plan with supervisor
/MODEL OF PMP
Note: There are 4 models shown in the slides
WHY THERE ARE VARIOUS MODEL OF PMP?
It is designed based on the suitability of the company
The situation is different from one organization to another/within
The formulation of such model needs to be approached from a
Not all types of performance management process model are right
for companies. Luckily there are several different types that can be
chosen by an organization which will work best for the company.
PROCESS DIAGRAM (COMMON MODEL)
WHY THIS MODEL?
It recognizes the important of coaching as it connects
each stage of the model
It calls for the alignment of employee's goals to those of
Easy to understand & not crowded as it is 4 steps only
Can be implement easily
The performance planning process, where individual
objectives are linked to organisational goals, is the typical
starting point of the cycle and goal-setting usually occurs
in line with annual standard review cycles (Suutari and
According to Aguinis (2007), below are the elements that
been look up during the performance planning stage:
What needs to be done
Needs to include the key accountability, specific objectives
& performance standards
How job is done
A consideration of behaviours includes discussing
competencies which is KSAs
Identifying areas that need improvement & setting goals
to be achieved in each area
Agree on the development plan that have been discuss
Should be done throughout the year
Give continuous feedback & learning to employees
Employee shares or inform on any successes or problem to
In managing performance, supervisor gives employee an
opportunity to express their needs, concern and expectations
WHAT SHOULD SUPERVISOR
- "What": Objectives,
- "How": Behaviours,
- Building future capability
- Improving personal skills
• Career aspirations
-Prepare for potential
- Using capabilities to
choose a better path
Involves the meeting between employee & manager
to review their assessment
Provides a formal setting in which employee
receives feedback on his performance
Performance appraisal summarizes the employee's
contributions over the entire appraisal period which
is one year period
When doing performance review, each employee can be
placed into one of the three categories which are:
High Performer - Consistently exceeds standards,
proactively problem solves, takes appropriate initiative, and is
a positive influence on others as well as a good role model.
Middle Performer - Meets standards, responds well to
others’ problem solving ideas, strives to do a good job and may
need more experience or coaching. May be influenced either by
the high or the low performer.
Low Performer - Does not consistently meet standards,
may respond to problems in a negative way. May not recognize
the need for performance improvement.
6 STEPS FOR CONDUCTING
PRODUCTIVE PERFORMANCE REVIEWS
Identify what employee has done well & poorly
Discuss the implications of changing behaviours
Explain how skills used in past achievements can help overcome
any performance problems
Agree on an action plan
Set a follow-up meeting & agree on behaviours, actions, attitudes
to be evaluated
Note: Example of 2 Appraisal forms shown in the slides
A key value drivers
Uses non-cash recognition to reward good performance
Give rewards based on employee hard work and
Rewarding performance should be an on-going
managerial activity and not just an annual pay-linked
According to Armstrong (2002), his conceptualisation of
‘total reward’, this comprises both financial and nonfinancial elements
The performance management process timeline is
different from organization to organization. It is
depends on the company to decide when to start the
performance management process.
The timeline is either done yearly or annually, where
yearly is starting from January to December while
annually is on January to June (first half) and the other is
July to December (second half).
The performance management process will work in one
cycle and covers 12 months period consistent with
individual's performance year starting from the date of
CHALLENGES TO EFFECTIVE PMP
To ensure everyone's performance is managed in all areas of
To make sure the PMP was carried out in an honest manner
Supervisor & employee need to have good negotiating skills
Not all organisations are led by democratic leaders
where all employees are treated with trust
Change management is a challenge in itself. In order to
manage performance one has to be mindful of changes
in the environment and to adapt to it by managing the
It can be concluded that in order for the process to make
sense, there should be a supervisor and employees for
successful implementation of the process
There is a need for some leadership and management skills
to be applied as well as the consideration of personal attitude
and behaviour to ensure that the process is been lead well.
Send managers & supervisors for training (Example:
Leadership training, Communication skills training)
Do proper documentations for the PMP
Do proper research which PMP is most suitable for
To develop a strategic plan accompanied by employee
performance plan with clear and measurable targets
Improve their systems, rules and procedures to facilitate
effective employee performance.
Q & A sessions
-Thank you for your kind