Thorough analysis of need and significance of performance management system for an organisation and also explained process of PMS

1. Dr. Anand K. Rai
H e a d ( H R & A d m i n i s t r a t i o n )
T h e I n d i a n Wo o d P r o d u c t s
C o . L t d , B a r e i l l y
a n a n d r a i @ i w p k a t h a . c o . i n
Dr. Anand K. Rai, IWP,Bareilly, anandrai@iwpkatha.co.in
1
PERFORMANCE
MANAGEMENT SYSTEM

2. Strategic and Integrated process
• that delivers sustained success to organizations
• by improving the performance of the people who
work in them
• and by developing the capabilities of individual
contributors and teams.
- Michael Armstrong
PERFORMANCE MANAGEMENT
Dr. Anand K. Rai, IWP,Bareilly, anandrai@iwpkatha.co.in
2

3. • Large number of organisations still follow trait-based confidential
formats
• Most are dissatisfied with present systems
• A few organisations have begun experimenting with new systems
• Organizations that have merely changed the format and not
reoriented managers have run into problems
• Managers want open systems
• To know how their bosses rate them
• Intellectually accepts open systems but face blocks in
implementing them
• Most managers still don’t realise the full potential of performance
appraisal
Performance Measurement in INDIAPerformance Measurement in INDIA
Dr. Anand K. Rai, IWP,Bareilly,
anandrai@iwpkatha.co.in
3

4. • Most see development as a Personnel/HR job and not a line
function
• In a lot of organizations symbols become more important
than the purpose
• There is a shift from ‘Composite’ appraisal to ‘Separate’
appraisal for different purposes
• Performance appraisal systems are becoming more open,
discussion-based, with 360 degree feedback
• Shorter, quicker reviews; team appraisals’ flexible systems;
innovations and experimentation in performance appraisal
system are becoming buzzwords.
Performance Measurement in INDIA
Dr. Anand K. Rai, IWP,Bareilly, anandrai@iwpkatha.co.in
4

5. Why check performance?
Dr. Anand K. Rai, IWP,Bareilly,
anandrai@iwpkatha.co.in
5

6. Basic steps in PMS
Dr. Anand K. Rai, IWP,Bareilly, anandrai@iwpkatha.co.in
6
 Performance Appraisal
 Measuring Success
 Finding Performance Gaps
 Finding Performance Opportunities
 Developing Scope & Opportunities
 Developing Capabilities
 Reinforcing Success
 Achieving / Exceeding target results year after year

7. Performance Appraisal and other HRM Functions
Dr. Anand K. Rai, IWP,Bareilly,
anandrai@iwpkatha.co.in
7

8. Environment
• Equipment/materials
• Job design
• Economic conditions
• Unions
• Rules and policies
• Management support
• Laws and regulations
Ability
• Technical skills
• Interpersonal skills
• Problem-solving
• Analytical skills
• Communication skills
• Physical limitations
Motivation
• Career ambition
• Employee conflict
• Frustration
• Fairness/satisfaction
• Goals/expectations
P = f (A,M,E)
Factors that Influence Performance
Dr. Anand K. Rai, IWP,Bareilly, anandrai@iwpkatha.co.in 9

9. SUPERIOR
CUSTOMERS
TEAM
SUBORDINATES
PEERS SELF
Alternative Sources
of Appraisal
Dr. Anand K. Rai, IWP,Bareilly, anandrai@iwpkatha.co.in 10

10. HOW?
Appraisal
Methods
Dr. Anand K. Rai, IWP,Bareilly, anandrai@iwpkatha.co.in
11
• Objective Bound
– MBO
• Absolute Measures
– Graphic rating scales
– See Performance
– BARS – See Potential
– Critical incidents
– Narrative essay
• Comparative Rating
– Ranking
– Forced distribution
360 appraisal of
Values & Ethics,
Leader Qualities

11. Step 1:
Organization
goals and
metrics
Step 2:
Department
goals and
metrics
Step 5:
Interim
review
Step 5b:
New inputs
are then
provided
Step 5a:
Inappropriate
goals/metrics
deleted
Step 4:
Mutual
agreement of
goals and
metrics
Step 3:
Subordinate
proposes
goals and
metrics
Step 3:
Supervisor
lists goals and
metrics for
subordinate
Step 7:
Review of
organization
performance
Step 6:
Final
review
MBO
Dr. Anand K. Rai, IWP,Bareilly, anandrai@iwpkatha.co.in 12

12. WHAT?
Criteria used
Dr. Anand K. Rai, IWP,Bareilly, anandrai@iwpkatha.co.in
18
Traits or
characteristics
Actual
performance
Training
Needs
Potential

13. Supervisor Roles in PA
Purpose
Determining merit compensation
Identifying/solving perf. problems
Identifying training needs
Staff development & career planning
Motivating employees
Promotion/selection decisions
Role
Judge
Doctor
Doctor
Counsellor
Counsellor
Judge
ie. role conflicts - Judge/Counsellor/Doctor
Dr. Anand K. Rai, IWP,Bareilly, anandrai@iwpkatha.co.in 20

14. Role of Appraiser
Dr. Anand K. Rai, IWP,Bareilly, anandrai@iwpkatha.co.in
21
• Understand the Appraisee as a Human Being
• Value Basics – strong points vs. weak points
• Understand the Appraisee as an Employee
• Performance on job – achievement, stretch
• Understand the dynamics of Career Aspiration
• Understand the dynamics of Life Aspirations
• Guide with compassion, Assess with Business mind
• Setting Goals for Appraisees & Appraising them

15. Appraisal Interviewing Styles
Dr. Anand K. Rai, IWP,Bareilly, anandrai@iwpkatha.co.in
22
 Tell and Sell
 Tell and Listen
 Problem Solving
 Mixed

16. Why Performance Appraisals can fail?
Dr. Anand K. Rai, IWP,Bareilly,
anandrai@iwpkatha.co.in
23

17. • Halo / Horns
• Constant error – Leniency/Strictness
• Central Tendency Error
• Similarity Error
• Primacy and Recency Error
• Effect of ‘Attribution Theory’
• Inability of a rater to differentiate between
‘effort’ and ‘results’
• Error arising due to one’s personal biases and
prejudices
Errors in Performance Measurement
Dr. Anand K. Rai, IWP,Bareilly,
anandrai@iwpkatha.co.in
24