The document discusses the relationship between strategic planning and performance management. It outlines the key steps in strategic planning, including environmental analysis, SWOT analysis, gap analysis, developing a mission and vision, setting goals and strategies. It emphasizes the importance of aligning strategic plans across all levels of the organization from the overall organization down to individual job descriptions and performance goals. This ensures strategic plans can be implemented and that performance management systems properly motivate employees to achieve organizational priorities.

1. Herman Aguinis, University of Colorado at Denver
PERFORMANCE MANAGEMENT
AND
STRATEGIC PLANNING
Prof. Preeti Bhaskar
Symbiosis Centre for Management Studies, NOIDA

2. Herman Aguinis, University of Colorado at Denver
Strategic Planning: Definition
• Process
• Describe organization’s
destination
• Assess barriers
• Select approaches for moving
forward
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3. Herman Aguinis, University of Colorado at Denver
Goal of Strategic Planning:
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Allocateresources to
provideorganization
withcompetitive
advantage

4. Herman Aguinis, University of Colorado at Denver
Strategic Planning: Purposes
 Help define the organization’s identity
 Help organization prepare for the future
 Enhance ability to adapt to environmental
change
 Provide focus and allow for better allocation of
resources
 Produce an organizational culture of
cooperation
 Allow for the consideration of new options and
opportunities
 Provide employees with information to direct
daily activities
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5. Herman Aguinis, University of Colorado at Denver
Therewas agoodstrategic
planninginmost of the
organization, but thereis no
clearrelationshipbetween
Organizational Level and
individual level goals.There is a need to link the strategic planning with
individual goals

6. Herman Aguinis, University of Colorado at Denver
Alignment of Strategic Plan with
Performance
Critical to involve all
levels of management
Critical to involve all
unit head &
department head

7. Herman Aguinis, University of Colorado at Denver
Resent study including 338
organization in 42 countries
found performance
management is the 3rd
most
important factor affecting
success of a strategic plan.

8. Herman Aguinis, University of Colorado at Denver
Linking among organization ,
Unit strategic Plan , Job
Description and individual and
Team
BANK OF UTAH
Washington, United States

9. Herman Aguinis, University of Colorado at Denver
Mission statement:
The mission of the corporation is to operate as a
High performing financial institution providing a
wide range of profitable Competitive and superior
financial services in our market
Goals:
To attract and retain an outstanding staff who are
highly motivated and productive and who vigorously
pursue revenue – generating and Costs-reduction
strategies
Strategy:
Critically reviews out existing branches and
departments to Ensure that all branches are
consistent in their goals, strategies, And profit
objectives.

10. Herman Aguinis, University of Colorado at Denver
Mission
(Department Level):
Increase the Knowledge,
management skills and Decision-
making abilities of our branches
Managers so that we will minimize
losses and other operating
expenses. While maximizing the
profitability of our branching
systems.

11. Herman Aguinis, University of Colorado at Denver
Position Description
for HR Manager
Administers A comprehensive
human resources program in the
division to ensure the expertise,
effectiveness, motivation, and
depth
( including providing appropriate
management succession) to the
division’s staff members.

12. Herman Aguinis, University of Colorado at Denver
Individual
Performance:
Information on various
responsibilities, standards
expected, goals to be reached, and
actions to be taken to improve
performance in the future..

13. Herman Aguinis, University of Colorado at Denver
Steps require for successful Strategic
Planning

14. Herman Aguinis, University of Colorado at Denver
Environmental Analysis
Identifies external and internal
trends
• To understand broad industry issues
• To make decisions using “big picture”
context
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SWOT AnalysisSWOT Analysis

15. Herman Aguinis, University of Colorado at Denver
External trends
• Opportunities:
• environmental characteristics that can help the
organization succeed
• Threats:
• environmental characteristics that can prevent the
organization from being successful
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Factors to Consider
• Economic
• Political/legal
• Social
• Technological
• Competitors
• Customers
• Suppliers

16. Herman Aguinis, University of Colorado at Denver
Internal trends
• Strengths:
• internal characteristics that the
organization can use for its advantage
• Weaknesses:
• internal characteristics that can hinder the
success of the organization
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Factors to Consider
• Organizational structure
• Organizational culture
• Politics
• Processes
• Size

17. Herman Aguinis, University of Colorado at Denver
Gap Analysis
Analyzes:
External environment
(opportunities and threats)
vis-à-vis
Internal environment
(strengths and weaknesses)
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18. Herman Aguinis, University of Colorado at Denver
Gap analysis determines:
Opportunity + Strength = Leverage
Opportunity + Weakness = Constraint
Threat + Strength = Vulnerability
Threat + Weakness = Problem
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19. Herman Aguinis, University of Colorado at Denver
Strategic Planning for the Organization
Environmental and Gap Analyses
provide information for organizations
to decide:
Who they are
What they do
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20. Herman Aguinis, University of Colorado at Denver
Mission
A good mission statement answers:
Why does the organization exist?
What is the scope of the organization’s
activities?
Who are the customers served?
What are the products or services offered?
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21. Herman Aguinis, University of Colorado at Denver
Mission Statement contains:
A. Information on organization’s
 Basic product/service to be offered
 Primary market/customer groups
 Unique benefits and advantages of
product/services
 Technology to be used
 Concern for survival through growth and
profitability
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B. Information on organization’s values and beliefs
 Managerial philosophy
 Public image sought by organization
 Self-concept of business adopted by
 Employees
 Stockholders

22. Herman Aguinis, University of Colorado at Denver
Vision
• Statement of future aspirations
• Focuses attention on what is important
• Provides context for evaluating
• Opportunities
• Threats
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A Good Vision Statement is:
 Brief
 Verifiable
 Bound by a Timeline
 Current
 Focused
 Understandable
 Inspiring
 A stretch

23. Herman Aguinis, University of Colorado at Denver
Purposes for Setting Goals
• Formalize expected achievements
• Provide motivation
• Provide tangible targets
• Provide basis for good decisions
• Provide basis for performance measurement
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Strategies
• Create strategies or Game Plans or “How to”
procedures to address issues of:
• Growth
• Survival
• Turnaround
• Stability
• Innovation
• Leadership

24. Herman Aguinis, University of Colorado at Denver
How the HR Function contributes:
• Communicate knowledge of strategic
plan
• Provide knowledge of KSAs needed for
strategy implementation
• Propose reward systems
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25. Herman Aguinis, University of Colorado at Denver
Strategic Plans at the Unit Level
• Organization Mission statement, Vision
statement, Goals, and Strategies
Must clearly align with………
And be congruent with……
• Every Unit Mission statement, Vision
statement, Goals, and Strategies
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26. Herman Aguinis, University of Colorado at Denver
Job Descriptions
• Tasks and KSAs are congruent
with Organization and Unit
strategic plans
• Activities described support
mission and vision of
Organization and Unit
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27. Herman Aguinis, University of Colorado at Denver
Individual and Team Performance
Organization and Unit mission, vision, goals lead
to
 Performance management system, which
Motivates employees
Aligns development plans with organization
priorities
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28. Herman Aguinis, University of Colorado at Denver
Strategic Plan  Choices in PM System
Design
• Criteria (Behavior vs. Results)
• Participation (Low vs. High)
• Temporal Dimension (Short Term vs. Long
Term)
• Level of Criteria (Individual vs.
Team/Group)
• System Orientation (Developmental vs.
Administrative)
• Rewards (Pay for Performance vs.
Tenure/Position)
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29. Herman Aguinis, University of Colorado at Denver
Building Support –
Answering “What’s In It for
Me?”
• Top Management:
• Help carry out vision
• All levels:
• Involvement
• Participation
• Understanding
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