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Indukaka ipcowala instiutute of management

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The report discusses performance management and defines it as a strategic approach to improving employee and organizational performance. It outlines the key aspects of an effective performance management process including setting clear expectations, regularly monitoring performance, providing feedback, evaluating results, and rewarding good performance. The goals of performance management are to increase communication, clarify goals and responsibilities, identify and address performance issues, and provide the basis for personnel decisions. An effective performance management system that engages employees can help an organization achieve its long-term and short-term goals.

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INDUKAKA IPCOWALA INSTIUTUTE OF MANAGEMENT REPORT ON PERFOMANCE MANAGEMENT Subject: HRM Submitted to: Arpit Patel Submission Date: 25/4/2012 Prepared by: Kirtan Darji 11pgdm002 Robin Khristi 11pgdm003 Niraj Pandya 11pgdm004 Sapan Pandya 11pgdm005 Hardik Patel 11pgdm006 Ravi Patel 11pgdm009

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Introduction Performance Management is one of the key processes that, when effectively carried out, helps employees know that their contributions are recognized and acknowledged. Performance management is an ongoing process of communication between a supervisor and an employee that occurs throughout the year, in support of accomplishing the strategic objectives of the organization. The communication process includes clarifying expectations, setting objectives, identifying goals, providing feedback, and evaluating results. An effective performance management process sets the foundation for rewarding excellence by linking individual employee work efforts with the organization’s mission and objectives, the employee and the organization understand how that job contributes to the organization. Performance management is an overall process which ensures the efficiency of the personnel of the organization and achieving overall goals and objectives. Performance management brings focus on overall results, measuring results, focused and ongoing feedback about results, and development plans to improve results. The results measurements themselves are not the ultimate priority as much as ongoing feedback and adjustments to meet results. Defining performance management Performance management can be defined as a strategic and integrated approach to delivering sustained success to organization by improving the performance of the people who work in them and by developing the capabilities of teams and individual contributors. To perform well, employees need to know what is expected of them. The starting point is an up-to-date job description that describes the essential functions, tasks, and responsibilities of the job. It also outlines the general areas of knowledge and skills required of the employee an employee to be successful in the job. Performance expectations go beyond the job description. When you think about high quality on-the-job performance, you are really thinking about a range of expected job outcomes, such as What goods and services should the job produce? What impact should the work have on the organization? How do you expect the employee to act with clients, colleagues, and supervisors? What are the organizational values the employee must demonstrate? What are the processes, methods, or means the employee is expected to use?

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The range of performance expectations can be broad but can generally be broken into two categories: Results (The goods and services produced by an employee often measured by objectives or standards) Actions & Behaviours (The methods and means used to make a product and the behaviours and values demonstrated during the process. Actions and Behaviours can be measured through performance dimensions.) Performance expectations serve as a foundation for communicating about performance throughout the year. They also serve as the basis for assessing employee performance. When you and an employee set clear expectations about the results that must be achieved and the methods or approaches needed to achieve them, you establish a path for success. Performance and Organization Performance management is a means of getting better results from the organization, teams and individuals by understanding and managing performance within an agreed framework of planned goals, standards and competence requirements. An effective performance management process sets the foundation for rewarding excellence. By linking individual employee work efforts with the organization’s mission and objectives, the employee and the organization understand how that job contributes to the organization. By focusing attention on setting clear performance expectations (results + actions & behaviours), it helps the employee know what needs to be done to be successful on the job. Through the use of objectives, standards, performance dimensions, and other measures it focuses effort. This helps the department get done what needs to be done and provides a solid rationale for eliminating work that is no longer useful. By defining job-mastery and career development goals as part of the process, it makes it very clear how the current position supports employee growth and the additional opportunities the employee needs to explore. Through regular check-in discussions, which include status updates, coaching, and feedback, it promotes flexibility, allowing you and the employee to identify problems early and change the course of a project or work assignment. By emphasizing that an annual appraisal should simply be a summary of the conversations held between you and the employee during the entire cycle, it shifts the focus away from performance as an ―annual event‖ to performance as an on-going process.

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An effective performance management process, while requiring time to plan and implement, can save you and the employee time and energy. Most importantly, it can be a very effective motivator, since it can help organization and the employee achieve the best possible performance. Performance management and long term goals A clear mission statement understood by all employees Continuous communication of organizational priorities, business plans and progress Presence of systems focusing on quality improvement Clear linkage between performance and rewards Focus on performance of members of all levels Existence of clear, continuously reviewed, performance standards Presence of systems to foster high performance Emphasis on fostering good employee relations Performance management and short term goals Specific Measurable Attainable Relevant Timely Specific – Objectives and standards should let employees know exactly which actions and results they are expected to accomplish. Measurable – Whenever possible, objectives and standards should be based on quantitative measures such as direct counts, percentages, and ratios. Attainable – The objective or standard should be achievable, but challenging, and attainable using resources available. Relevant – Individual goals, objectives and standards should be in alignment with those of the unit and the department in support of the University’s mission. Timely – Results should be delivered within a time period that meets the department and organization’s needs.

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Performance Management Process Employee performance management includes: planning work and setting expectations, continually monitoring performance, developing the capacity to perform, periodically rating performance in asummary fashion, and rewarding good performance. The revisions made in 1995 to the Governmentwide performance appraisal and awards regulations support sound management principles. Great care was taken to ensure that the requirements those regulations establish would complement and not conflict with the kinds of activities and actions practiced in effective organizations as a matter of course. Additional background information on performance management can be found in the following articles: In an effective organization, work is planned out in advance. Planning means setting performance expectations and goals for groups and individuals to channel their efforts toward achieving organizational objectives. Getting employees involved in the planning process will help them understand the goals of the organization, what needs to be done, why it needs to be done, and how well it should be done. The regulatory requirements for planning employees' performance include establishing the elements and standards of their performance appraisal plans. Performance elements and standards should be measurable, understandable, verifiable, equitable, and achievable. Through critical elements, employees are held accountable as individuals for work assignments or responsibilities. Employee performance plans should be flexible so that they can be adjusted for changing program objectives and work requirements. When used effectively, these plans can be beneficial working documents that are discussed often, and not merely paperwork that is filed in a drawer and seen only when ratings of record are required. In an effective organization, assignments and projects are monitored continually. Monitoring well means consistently measuring performance and providing ongoing feedback to employees and work groups on their progress

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toward reaching their goals. Regulatory requirements for monitoring performance include conducting progress reviews with employees where their performance is compared against their elements and standards. Ongoing monitoring provides the opportunity to check how well employees are meeting predetermined standards and to make changes to unrealistic or problematic standards. And by monitoring continually, unacceptable performance can be identified at any time during the appraisal period and assistance provided to address such performance rather than wait until the end of the period when summary rating levels are assigned. In an effective organization, employee developmental needs are evaluated and addressed. Developing in this instance means increasing the capacity to perform through training, giving assignments that introduce new skills or higher levels of responsibility, improving work processes, or other methods. Providing employees with training and developmental opportunities encourages good performance, strengthens job-related skills and competencies, and helps employees keep up with changes in the workplace, such as the introduction of new technology. Carrying out the processes of performance management provides an excellent opportunity to identify developmental needs. During planning and monitoring of work, deficiencies in performance become evident and can be addressed. Areas for improving good performance also stand out, and action can be taken to help successful employees improve even further. From time to time, organizations find it useful to summarize employee performance. This can be helpful for looking at and comparing performance over time or among various employees. Organizations need to know who their best performers are. Within the context of formal performance appraisal requirements, rating means evaluating employee or group performance against the elements and standards in an employee's performance plan and assigning a summary rating of record. The rating of record is assigned according to procedures included in the organization's appraisal program. It is based on work performed during an entire appraisal period. The rating of record has a bearing on various other personnel actions, such as granting within-grade pay increases and determining additional retention service credit in a reduction in force. Note: Although group performance may have an impact on an employee's summary rating, a rating of record is assigned only to an individual, not to a group.

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In an effective organization, rewards are used well. Rewarding means recognizing employees, individually and as members of groups, for their performance and acknowledging their contributions to the agency's mission. A basic principle of effective management is that all behavior is controlled by its consequences. Those consequences can and should be both formal and informal and both positive and negative. Good performance is recognized without waiting for nominations for formal awards to be solicited. Recognition is an ongoing, natural part of day-to-day experience. A lot of the actions that reward good performance — like saying "Thank you" — don't require a specific regulatory authority. Nonetheless, awards regulations provide a broad range of forms that more formal rewards can take, such as cash, time off, and many nonmonetary items. The regulations also cover a variety of contributions that can be rewarded, from suggestions to group accomplishments. Where PM is applied The PM approach is used most often in the workplace, can apply wherever people interact — schools, churches, community meetings, sports teams, health setting, governmental agencies, and even political settings - anywhere in the world people interact with their environments to produce desired effects. Armstrong and Baron (1998) defined it as a ―strategic and integrated approach to increasing the effectiveness of organizations by improving the performance of the people who work in them and by developing the capabilities of teams and individual contributors.‖ It may be possible to get all employees to reconcile personal goals with organizational goals and increase productivity and profitability of an organization using this process. It can be applied by organisations or a single department or section inside an organisation, as well as an individual person. The performance process is appropriately named the self-propelled performance process (SPPP).[citation needed] First, a commitment analysis must be done where a job mission statement is drawn up for each job. The job mission statement is a job definition in terms of purpose, customers, product and scope. The aim with this analysis is to determine the continuous key objectives and performance standards for each job position. Following the commitment analysis is the work analysis of a particular job in terms of the reporting structure and job description. If a job description is not available, then a systems analysis can be done to draw up a job description. The aim with this analysis is to determine the continuous critical objectives and performance standards for each job.

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Benefits Direct financial gain Grow sales Reduce costs Stop project overruns Aligns the organization directly behind the CEO's goals Decreases the time it takes to create strategic or operational changes by communicating the changes through a new set of goals Motivated workforce Optimizes incentive plans to specific goals for over achievement, not just business as usual Improves employee engagement because everyone understands how they are directly contributing to the organisations high level goals Create transparency in achievement of goals High confidence in bonus payment process Professional development programs are better aligned directly to achieving business level goals Improved management control Flexible, responsive to management needs Displays data relationships Helps audit / comply with legislative requirements Simplifies communication of strategic goals scenario planning Provides well documented and communicated process documentation Objectives The objectives of Performance Management are to: 1. Increase two-way communication between supervisors and employees 2. Clarify mission, goals, responsibilities, priorities and expectations 3. Identify and resolve performance problems 4. Recognize quality performance 5. Provide a basis for administrative decisions such as promotions, succession and strategic planning, and pay for performance.

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Conclusion Performance management is concerned with communication and involvement. It creates acclimate in which a continuing dialogue between managers and the members of their teas takes place to define expectations and share information on the organization’s mission values and objectives. Like all other systems, performance management systems require continuous review and change. Every change and corporate goals or strategies requires modifications in operational priorities while changes in technology or workforce characteristics necessities new ways of working. This means that a performance management system should evolve in response to emerging priorities. A vision of an organization is the main concern, and the employees are the individuals who give a view of the goal. If the overall performance of the organization is systematic and concerned only then it can achieve its long term and short term goal with high efficiency and effectiveness.

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Indukaka ipcowala instiutute of management

  • 1. INDUKAKA IPCOWALA INSTIUTUTE OF MANAGEMENT REPORT ON PERFOMANCE MANAGEMENT Subject: HRM Submitted to: Arpit Patel Submission Date: 25/4/2012 Prepared by: Kirtan Darji 11pgdm002 Robin Khristi 11pgdm003 Niraj Pandya 11pgdm004 Sapan Pandya 11pgdm005 Hardik Patel 11pgdm006 Ravi Patel 11pgdm009
  • 2. Introduction Performance Management is one of the key processes that, when effectively carried out, helps employees know that their contributions are recognized and acknowledged. Performance management is an ongoing process of communication between a supervisor and an employee that occurs throughout the year, in support of accomplishing the strategic objectives of the organization. The communication process includes clarifying expectations, setting objectives, identifying goals, providing feedback, and evaluating results. An effective performance management process sets the foundation for rewarding excellence by linking individual employee work efforts with the organization’s mission and objectives, the employee and the organization understand how that job contributes to the organization. Performance management is an overall process which ensures the efficiency of the personnel of the organization and achieving overall goals and objectives. Performance management brings focus on overall results, measuring results, focused and ongoing feedback about results, and development plans to improve results. The results measurements themselves are not the ultimate priority as much as ongoing feedback and adjustments to meet results. Defining performance management Performance management can be defined as a strategic and integrated approach to delivering sustained success to organization by improving the performance of the people who work in them and by developing the capabilities of teams and individual contributors. To perform well, employees need to know what is expected of them. The starting point is an up-to-date job description that describes the essential functions, tasks, and responsibilities of the job. It also outlines the general areas of knowledge and skills required of the employee an employee to be successful in the job. Performance expectations go beyond the job description. When you think about high quality on-the-job performance, you are really thinking about a range of expected job outcomes, such as What goods and services should the job produce? What impact should the work have on the organization? How do you expect the employee to act with clients, colleagues, and supervisors? What are the organizational values the employee must demonstrate? What are the processes, methods, or means the employee is expected to use?
  • 3. The range of performance expectations can be broad but can generally be broken into two categories: Results (The goods and services produced by an employee often measured by objectives or standards) Actions & Behaviours (The methods and means used to make a product and the behaviours and values demonstrated during the process. Actions and Behaviours can be measured through performance dimensions.) Performance expectations serve as a foundation for communicating about performance throughout the year. They also serve as the basis for assessing employee performance. When you and an employee set clear expectations about the results that must be achieved and the methods or approaches needed to achieve them, you establish a path for success. Performance and Organization Performance management is a means of getting better results from the organization, teams and individuals by understanding and managing performance within an agreed framework of planned goals, standards and competence requirements. An effective performance management process sets the foundation for rewarding excellence. By linking individual employee work efforts with the organization’s mission and objectives, the employee and the organization understand how that job contributes to the organization. By focusing attention on setting clear performance expectations (results + actions & behaviours), it helps the employee know what needs to be done to be successful on the job. Through the use of objectives, standards, performance dimensions, and other measures it focuses effort. This helps the department get done what needs to be done and provides a solid rationale for eliminating work that is no longer useful. By defining job-mastery and career development goals as part of the process, it makes it very clear how the current position supports employee growth and the additional opportunities the employee needs to explore. Through regular check-in discussions, which include status updates, coaching, and feedback, it promotes flexibility, allowing you and the employee to identify problems early and change the course of a project or work assignment. By emphasizing that an annual appraisal should simply be a summary of the conversations held between you and the employee during the entire cycle, it shifts the focus away from performance as an ―annual event‖ to performance as an on-going process.
  • 4. An effective performance management process, while requiring time to plan and implement, can save you and the employee time and energy. Most importantly, it can be a very effective motivator, since it can help organization and the employee achieve the best possible performance. Performance management and long term goals A clear mission statement understood by all employees Continuous communication of organizational priorities, business plans and progress Presence of systems focusing on quality improvement Clear linkage between performance and rewards Focus on performance of members of all levels Existence of clear, continuously reviewed, performance standards Presence of systems to foster high performance Emphasis on fostering good employee relations Performance management and short term goals Specific Measurable Attainable Relevant Timely Specific – Objectives and standards should let employees know exactly which actions and results they are expected to accomplish. Measurable – Whenever possible, objectives and standards should be based on quantitative measures such as direct counts, percentages, and ratios. Attainable – The objective or standard should be achievable, but challenging, and attainable using resources available. Relevant – Individual goals, objectives and standards should be in alignment with those of the unit and the department in support of the University’s mission. Timely – Results should be delivered within a time period that meets the department and organization’s needs.
  • 5. Performance Management Process Employee performance management includes: planning work and setting expectations, continually monitoring performance, developing the capacity to perform, periodically rating performance in asummary fashion, and rewarding good performance. The revisions made in 1995 to the Governmentwide performance appraisal and awards regulations support sound management principles. Great care was taken to ensure that the requirements those regulations establish would complement and not conflict with the kinds of activities and actions practiced in effective organizations as a matter of course. Additional background information on performance management can be found in the following articles: In an effective organization, work is planned out in advance. Planning means setting performance expectations and goals for groups and individuals to channel their efforts toward achieving organizational objectives. Getting employees involved in the planning process will help them understand the goals of the organization, what needs to be done, why it needs to be done, and how well it should be done. The regulatory requirements for planning employees' performance include establishing the elements and standards of their performance appraisal plans. Performance elements and standards should be measurable, understandable, verifiable, equitable, and achievable. Through critical elements, employees are held accountable as individuals for work assignments or responsibilities. Employee performance plans should be flexible so that they can be adjusted for changing program objectives and work requirements. When used effectively, these plans can be beneficial working documents that are discussed often, and not merely paperwork that is filed in a drawer and seen only when ratings of record are required. In an effective organization, assignments and projects are monitored continually. Monitoring well means consistently measuring performance and providing ongoing feedback to employees and work groups on their progress
  • 6. toward reaching their goals. Regulatory requirements for monitoring performance include conducting progress reviews with employees where their performance is compared against their elements and standards. Ongoing monitoring provides the opportunity to check how well employees are meeting predetermined standards and to make changes to unrealistic or problematic standards. And by monitoring continually, unacceptable performance can be identified at any time during the appraisal period and assistance provided to address such performance rather than wait until the end of the period when summary rating levels are assigned. In an effective organization, employee developmental needs are evaluated and addressed. Developing in this instance means increasing the capacity to perform through training, giving assignments that introduce new skills or higher levels of responsibility, improving work processes, or other methods. Providing employees with training and developmental opportunities encourages good performance, strengthens job-related skills and competencies, and helps employees keep up with changes in the workplace, such as the introduction of new technology. Carrying out the processes of performance management provides an excellent opportunity to identify developmental needs. During planning and monitoring of work, deficiencies in performance become evident and can be addressed. Areas for improving good performance also stand out, and action can be taken to help successful employees improve even further. From time to time, organizations find it useful to summarize employee performance. This can be helpful for looking at and comparing performance over time or among various employees. Organizations need to know who their best performers are. Within the context of formal performance appraisal requirements, rating means evaluating employee or group performance against the elements and standards in an employee's performance plan and assigning a summary rating of record. The rating of record is assigned according to procedures included in the organization's appraisal program. It is based on work performed during an entire appraisal period. The rating of record has a bearing on various other personnel actions, such as granting within-grade pay increases and determining additional retention service credit in a reduction in force. Note: Although group performance may have an impact on an employee's summary rating, a rating of record is assigned only to an individual, not to a group.
  • 7. In an effective organization, rewards are used well. Rewarding means recognizing employees, individually and as members of groups, for their performance and acknowledging their contributions to the agency's mission. A basic principle of effective management is that all behavior is controlled by its consequences. Those consequences can and should be both formal and informal and both positive and negative. Good performance is recognized without waiting for nominations for formal awards to be solicited. Recognition is an ongoing, natural part of day-to-day experience. A lot of the actions that reward good performance — like saying "Thank you" — don't require a specific regulatory authority. Nonetheless, awards regulations provide a broad range of forms that more formal rewards can take, such as cash, time off, and many nonmonetary items. The regulations also cover a variety of contributions that can be rewarded, from suggestions to group accomplishments. Where PM is applied The PM approach is used most often in the workplace, can apply wherever people interact — schools, churches, community meetings, sports teams, health setting, governmental agencies, and even political settings - anywhere in the world people interact with their environments to produce desired effects. Armstrong and Baron (1998) defined it as a ―strategic and integrated approach to increasing the effectiveness of organizations by improving the performance of the people who work in them and by developing the capabilities of teams and individual contributors.‖ It may be possible to get all employees to reconcile personal goals with organizational goals and increase productivity and profitability of an organization using this process. It can be applied by organisations or a single department or section inside an organisation, as well as an individual person. The performance process is appropriately named the self-propelled performance process (SPPP).[citation needed] First, a commitment analysis must be done where a job mission statement is drawn up for each job. The job mission statement is a job definition in terms of purpose, customers, product and scope. The aim with this analysis is to determine the continuous key objectives and performance standards for each job position. Following the commitment analysis is the work analysis of a particular job in terms of the reporting structure and job description. If a job description is not available, then a systems analysis can be done to draw up a job description. The aim with this analysis is to determine the continuous critical objectives and performance standards for each job.
  • 8. Benefits Direct financial gain Grow sales Reduce costs Stop project overruns Aligns the organization directly behind the CEO's goals Decreases the time it takes to create strategic or operational changes by communicating the changes through a new set of goals Motivated workforce Optimizes incentive plans to specific goals for over achievement, not just business as usual Improves employee engagement because everyone understands how they are directly contributing to the organisations high level goals Create transparency in achievement of goals High confidence in bonus payment process Professional development programs are better aligned directly to achieving business level goals Improved management control Flexible, responsive to management needs Displays data relationships Helps audit / comply with legislative requirements Simplifies communication of strategic goals scenario planning Provides well documented and communicated process documentation Objectives The objectives of Performance Management are to: 1. Increase two-way communication between supervisors and employees 2. Clarify mission, goals, responsibilities, priorities and expectations 3. Identify and resolve performance problems 4. Recognize quality performance 5. Provide a basis for administrative decisions such as promotions, succession and strategic planning, and pay for performance.
  • 9. Conclusion Performance management is concerned with communication and involvement. It creates acclimate in which a continuing dialogue between managers and the members of their teas takes place to define expectations and share information on the organization’s mission values and objectives. Like all other systems, performance management systems require continuous review and change. Every change and corporate goals or strategies requires modifications in operational priorities while changes in technology or workforce characteristics necessities new ways of working. This means that a performance management system should evolve in response to emerging priorities. A vision of an organization is the main concern, and the employees are the individuals who give a view of the goal. If the overall performance of the organization is systematic and concerned only then it can achieve its long term and short term goal with high efficiency and effectiveness.