Presentation on theme: "Human Resources Management & Development"— Presentation transcript:
1 Human Resources Management & Development May 04, 2005 (Wednesday)Presented By: Tariq SaeedToPakistan Steel Mills
2 Overview Introduction to Human Resource Management. Evolution & Development of HRMFoundations of HRMTheory & PracticeStrategic HRMMotivation of Employees & LeadershipPerformance Management
3 Has evolved through the The Concept Of HRMHas evolved through theDevelopmentofManagementThoughtprocess
4 Definition Of Management Management is the process of designing and maintaining an environment in which individuals, working together in groups, efficiently accomplish selected aims.
5 Types Of ManagementManagement is classified into four branches in accordance with the type of resources it deals with, i.e.,Money (Finance)Finance ManagementMaterialMaterials ManagementMachine (Technology)Operational ManagementMen (Human Resource)Human Resources Management.
6 Human Resource Management The branch ofManagement ofThe Human Resources
7 Evolution Of Human Resources Management The Industrial Revolution (1776)The Emergence of Free Collective BargainingScientific ManagementUS Civil Services CommissionPrivate Industry’s Approach to Personnel ManagementHuman Relations MovementThe Behavioral Sciences
8 Development Of HRM Pioneer Work Behavioral Science Movement Organizational Development MovementThe Corporate Culture CultThe Art Of Japanese ManagementPeter Drucker 1950Douglas McgregerMaslows HierarchyOf Needs 1960
9 Growth Of Human Resources Management File Maintenance StageGovernment Accountability StageOrganizational Accountability StageStrategic Partner-ship Stage
11 Change From Personnel To HRM From personnel department to HRM department.A change in approach and a change in name.Treating seriously the issues of attracting developing motivating people and to utilize them effectively.The organizations now rate high on development of following:personnel and HRM policiessystems, practicesAgreementsconsistent with the corporate strategy
13 What Is HRM Concerned About? “Human Resource Management is concerned with the problems, organizations face at all levels of the organization”.“These activities undertaken by the organizations are the means by which they assure themselves of A long term supply of people with needed competencies and required levels of loyalty and commitment ”. ( “Professor Michael Bear”)
14 Definition Of The Functions Of HRM Human Resource Management is the process of acquiring, training, appraising, and compensating, retaining employees and attending to their labor relations, health and safety, and fairness concerns.
15 Present Concept Of HRMHuman resource management in its present form is an approach to the management of people based on four fundamental principles.Human resources are the most important assets of an organization. Their Management is the key to its success.Success is most likely if the personnel policies and procedures are closely linked with, objectives and strategic plans.The corporate culture and values, organizational climate and managerial behavior culture influences the achievement of excellence. This culture be managed.HRM is concerned with integration. Getting all the members of the organization involved in working together with a common sense.
16 HRM ConceptHRM involves all the management decisions and actions that affect the nature of the relationship between the organization and employees i.e., Its Human Resources.It communicates the instrumental values about people and the notion that people no less than, physical plans and financial resources may be viewed and managed as assets.The most important implication of this approach is the development of trust between employees, managers and unions
17 HRM ConceptHuman Resource Management is the responsibility of all those who manage people.It is the management concerned with people at work and with their relationship within an enterprise.It applies to all fields of employment.It aims at achieving both efficiency and justice.It seeks to brings together and develop into an effective organization, all the people of an enterprise, to make there best contribution to its success both as an individual and as member of working group.It seeks to provide fair terms and conditions of employment and satisfying work for the employed.
18 Emerging Trends In HRM Three basic traditions. Personnel Administration.Labor Relations.Organizational Development.Changes in basic values of society.Fundamental shift in ideology to the concern for the whole and not a part of community.Concern with the rights of the managed not just the managers.A shift towards greater concern for the systems of the organization.Contd..
19 Employee involvement and union-management collaboration. To identify problems and develop processes.Competence and commitment issues given attention.Traditional control on information flow giving way to more openness to employees and increase communicationsShift from short term perspective to long term perspective to problems and their solutionsIncreased emphasis on training and development activities, performance appraisal and improvement processes.Contd..
20 A concern for the outcomes not just the role and policies Flexibility in application of HR policies to individuals and the businessFlexibility in control at the top to a more participative and collaborative managementWillingness to talk about the problems in organizationChange in attitudes towards conflictsHRM concerned with the groups of shareholders, employees, the union and the government
21 HRM People Functions Include: Performance ManagementEmployees CommunicationsTrain and developEmployee commitmentEqual opportunityHealth and safetyGrievances/labor relationsJob analysesLabor needsRecruitSelect candidatesOrient and trainWages and salariesIncentives and benefits
22 HRM Is Important to All Managers. Don’t Let These Happen In Your Areas! The wrong personHigh turnoverPoor resultsUseless interviewsCourt actionsSafety citationsSalaries appear unfairPoor trainingUnfair labor practices
23 Line And Staff Aspects Of HRM AuthorityMaking decisionsDirecting workGiving ordersLine ManagersAccomplishing goalsStaff ManagersAssisting and advising line managersDefinition
24 Line Manager’s HRM Jobs Policies and proceduresLabor costsDevelopmentMoraleProtectingThe right personOrientationTrainingPerformanceCreativityWorking relationships
25 Staff Manager’s HRM Jobs Line authorityImplied authorityFunctional controlEmployee advocacy
26 Activities Which Constitutes HRM Staffing.Retention.Development.Adjustment.Managing Change.Together these activities constitutes the HRM System.
27 HRM ActivitiesAll these activities are the special responsibilities of HR Department but these are also at the core of every managers job throughout an organization. The line managers have authority and have considerable impact on the way workers actually behave.
28 These Activities Can Be Carried Out At: Individual levels.Work teams.Departmental levels.Organizational levels
29 Staffing Identifying work requirements within an organization. Determining the numbers of people and the skills mix necessary for the the work.Recruiting, selecting and promoting qualified candidates.
30 Retention Rewarding employees’ for performing their jobs effectively. Ensuring harmonious working relations between employees and managers.Maintaining a safe and healthy work environment.
31 DevelopmentA function whose objectives is to preserve and enhance employees’ competence in their jobs through improving their knowledge, skills, abilities and other characteristics; (“COMPETENCIES”)
32 AdjustmentComprises activities intended to maintain compliance with the organization's HR policies (e.g. through discipline) and business strategies (e.g. cost leadership)
33 Managing ChangeAn ongoing process whose objective is to enhance the ability of an organization to anticipate and respond to development in its external and internal environments and to enable employees at all levels to cope with the changes.
34 Change In Recruiting Strategy A change in recruiting strategy in accordance with the expected job requirements means:Develop selection procedure that will identify the kind of competencies required for future employees.Change in compensation policies.New incentive systems be developed.Offer new training & development programs.Assessment procedures will be changed.New rewards procedures.Discharge, promote or transfer some employees.Provide mechanism to remaining employees to cope with change.
35 Objectives Of HRM Department Broad objectiveto optimize the usefulness of all workers in an organizationSpecial objectiveTo help line managers manage those workers more effectively.The HR department accomplishes this special objective through policy initiation and formulation, advice, service and control in resonance with line managers.Thus the HR responsibilities are shared by the hr department and line managers.
36 Special Objectives The special objective is accomplished through: Policy incitation and formulation.Advise.Service.Control in close coordination with line managers.
37 How Do Line Managers’ Share These Activities ActivityLine Managers ResponsibilityHR Department ResponsibilitySTAFFINGProviding data for job analysis and minimum qualifications; integrating strategic plans with HR Plans at the unite level, interviewing candidates, integrating information collected y the HR dept., making final decisions on entry level hires and promotions.Job analysis, HR planning, recruitment, compliance with civil rights laws and regulations; application blanks, written tests, performance tests, interview, background investigations, reference checks and physical examinations.RETENTIONFair treatment of employees, open communication, face to face resolution of conflict, promotion of teamwork, respect for the dignity of each individual, pay increase base on merit.Compensation and benefits, employees’ relations, health and safety and employee services.DEVELOPMENTOn-the-job training, job enrichment, coaching, applied motivational strategies, performance feedback to subordinates.Development of legally sound performance management system, morale surveys, technical training, management and organization development, career planning, counseling and HR research.ADJUSTMENTDiscipline, discharge, layoffs and transfers.Investigation of employee complaints, outplacement services and retirement counseling.MANAGING CHANGEProvide a vision of where the company or unit is going & the resources to make the vision a reality.Provide expertise to facilitate the overall process of managing change.HR Provides Expertise : Line Managers Use it to Manage People Effectively
39 The HRM Process Strategic Organization Culture Environment Objectives HR StrategyOrganizational structureOutputsPerformance managementTraining and developmentReward managementEmployee relationsJob analysis recruitment
40 Strategic Human Resources Management Strategic HRM mean getting everybody from top of the organization to the bottom doing things to implement the strategy of business effectively.To use people most wisely with respect to the strategic needs of the organization.This needs an integrative frame work that systematically links HR activities with business needs. (Systems Approach)Development of a map and time line to ensure alignment between HR strategy and business strategy.
42 Human Resources Philosophy Or HR Contribution in Company Growth & Success A firm’s HR philosophy is generally a broad statement about how it regards its people, the role they play in the overall success of a business, and how they are to be treated and managed.Empowering people to drive to business from the closest point to the market.Developing the skills to be the best in the business.Building career opportunities.Building teamwork.Helping people succeed by the building an environment with high integrity, strong and consistent values, and continuous improvement.Changing environment towards effective time management, cost consciousness and improving interaction for increasing productivity by proactive support to line managers.
43 ORGANIZATIONAL STRATEGY Initiates the process of identifying strategic business needs and provides specific opportunities to themINTERNAL CHARACTERISTICSEXTERNAL CHARACTERISTICSSTRATEGIC BUSINESS NEEDSExpressed in mission or vision statements and translated into strategic business objectivesSTRATEGIC HUMAN RESOURCES MANAGEMENT ACTIVITIESHuman Resources Philosophy expressed in statements defining business values and culture.Human Resources Policies expressed as shared values (guidelines).Human Resources Programs articulated as Human Resources strategic.Human Resources Practices for leadership, managerial and operational roles.Human Resources processes for the formulation and implementation of other activities.Express how to treat and value people.Establishes guidelines for action on people related business issues and HR program.Coordinates efforts to facilitate change to address major people related business issues.Motivates needed role behaviors.Defines how these activities are carried out
44 Roles Of HR Manager Business person Shaper of change Consultant to the organization and partner to line managersStrategy formulator and implementerTALENT MANAGER (I.E network with professional colleagues, including recruiters,line managers, and other HR professionals)ASSET MANAGER AND COST CONTROLLER (Based on understanding financial and accounting procedures.)
45 Strategic Planning and Trends DefinitionStrategy is the company’s long-term plan for how it will balance its internal strengths and weaknesses with its external opportunities and threats to maintain a competitive advantage.Page 1-11
46 Strategic Planning 101There are three levels of strategic planning as shown belowCorporateStrategyBusinessStrategyBusinessStrategyBusinessStrategyBusinessStrategyFunctionalStrategies
47 The Strategic Planning Process SWOT analysis - Strengths, Weaknesses, Opportunities, and ThreatsBest strategic plans balance a company’s Strengths and Weaknesses with the Opportunities and Threats the firm facesBasic strategic trendsGlobalizationTechnological advancesThe nature of workThe workforcePage 1-12
48 HR’s Evolving Role Protector and Screener Change Agent Strategic Partner
49 Strategic HRM Definition Strategic Human Resource Management: linking HRM with strategic goals and objectives to improve business performance and develop organizational cultures fostering innovation and flexibility.Clarify the businessstrategyRealign the HRfunctions and keypeople practicesCreate needed competenciesand behaviorsRealization of businessstrategies and resultsEvaluate and refine
50 How HR Helps Strategy Execution Functional strategies should support competitive strategiesValue chain analysisOutsourcingStrategy Formulation
51 How HR Helps Form Strategy Formation of a company’s strategy = identifying, analyzing and balancing external opportunities and threats with internal strengths and weaknessesEnvironmental scanning
53 HR And Technology Basic HR systems demand paperwork 70% of HR’s employees time = paperworkOff the shelf forms from Office Depot/OfficemaxOnline formsHuman Resource Information Systems (HRIS)HR on the Internet
54 HR Means PerformanceCan HR have a measurable impact on a company’s bottom line?Better HRM translates into improved employee attitudes and motivation (e.g., working at home)Well run HR programs drive employee commitmentTOYOTA
55 Is There a “One Best HR Way”? Follow a company’s operating and strategic initiativesAll companies can benefit fromProfit sharing programsResults oriented appraisalsEmployment securityFoster informal relationships- promote worldwide communicationsDevelop global executives
56 Current Pressures On HRM Increase international competitionIncreasing complexity of business and size of organizationsSlower growth with receiving advancement opportunity to employeesIncreased education & awareness of the workforceChanging personal / work force valuesMore concern with career and life satisfactionChanging workforce / mix demographyExpectations / satisfaction of employersProductivity improvement needsGreater involvement of government in HR development and practices
57 Challenges Faced By HR Managers Changing Mix Of Work ForceChanging Personal ValuesExpectations Of EmployeesLevels Of ProductivityDemands And Government Regulation
58 Strategic Objectives For HRM Design strategy ensuring fuller utilization of human resourcesEstablish and maintain a self-respecting relationship among all employeesEnable each person to make his/her maximum personal contribution to the effective working of the organization by creating an appropriate and conducive work climateBring about maximum individual development of personnel through renewed thrust on employees education and trainingMake effort to recognize and satisfy individual and group need for providing higher job satisfactionMaintain a high morale and better human relations to win employee’s commitment
59 How To Achieve Objectives? Answer to this question by creating a culture in the organization which is employee-oriented. The factors responsible for fostering good human relations and higher productivity are as follows:Management’s genuine belief that employees love work (create proper environment)Utilizing employee’s higher skills through their involvementRecognition to employee’s informal groupsHumanize jobs in which employees are called not by labels but by namesEmployee- orientated supervision, recognizing human dignityTwo-way communicationFeedback and counselingAbility based leadershipEmployee welfare and good quality of work lifeEquitable monetary benefits.
60 Critical HR Processes Training And Development Policies Implementation TQMTraining And DevelopmentPolicies ImplementationSystems Update And Procedures ImprovementPractices And Processes DevelopmentCompetencies (KSAs) DevelopmentTalent ManagementIdentification Of Future HR RequirementLeadership Development
61 HRM In Pakistan HRM in Pakistani Environment Current Trends of HRM in Pakistan
62 The Changing Role of HR Yesterday Today Tomorrow Success factors Business judgment intuitionInformation strategic plan missionFlexibility agility speedOrganizational stylePaternalisticProfessionalEmpowered learning vibrantEmployees considered as..Hungry, naked & defenseless creaturesThinking and rational beingsFully evolved completely satisfied, mature human beingsMotivational methodsDriving people through basic needsDriving people through social and intellectual needsPeople drive themselvesRole of HRProviding people with food, clothing and shelterMotivate by providing effective & fair appraisals systemsAs a change agentAs innovatorAs a strategic partner
63 Business Trends & HR Competencies For Our Times Globalization.Technology.Change.Knowledge Capital.Speed in Market.Cost Control.Credibility.People Skills.Understanding the Business of Business.A Consultative Approach.Comfort with Change.Visioning.
64 HRM & Philosophy Of Islam Authority and responsibility.Participative management.Rewards and performanceEqual opportunities concept.LeadershipEvaluation & improvement.Commitment & motivationBalanced approval
66 The term motive implies the action to satisfy a need. What Is Motive?Motive is an inner force that moves a person to behave in a certain way.Motives are the mainsprings of action in people.The term motive implies the action to satisfy a need.
67 MotivesMotives are the “WHYS” of behavior. They arouse and maintain activity and determine the general direction of the behavior of an individual.Motives are sometime defined as needs, wants, drives and impulses within the individual. Motives are directed towards goals which may be conscious or subconscious
68 MotivationMotivation is a general term applying to the entire class of drives, desires needs, wishes and similar forces.To say that managers motivate their subordinates is to say that they do those things which they hope will satisfy those drives and desires and induce the subordinates to act in a desired manner.Motivation is a complex subject. It involves the unique feelings and thoughts and past experiences of each of us as we share a variety of relationships within and outside the organizations.
69 Why Motivation?To initiate our followers to reach our objectives, we must hold some reward once the objective is attained.What rewards do people seek? The answer is that they seek to fulfill their wants and needs.
70 Human NeedsPRIMARY NEEDS: Physiological requirements for water, air, food, sleep & shelterSECONDARY NEEDSSelf EsteemStatusAffiliation With OthersAffection (Giving)AccomplishmentSelf Assertion
72 Motive Needs & WantsThe term motive, need, wants and drives are used interchange ably.Motivation can also be termed as the willingness to expand energy, achieve a goal or a reward.NEEDRespect from others.BEHAVIORoutstanding work on the job.REWARDpraise, pay increase, status symbols.
73 MotivatorMotivator is something that influences an individual behavior. It makes a difference in what a person will do.Motivators are things that induce a person to perform.Motivators are the identified rewards or incentives that sharpen the drive to satisfy the wants.
74 Motivation And Satisfaction Motivation refers to the drive and effort to satisfy a want or goal.When a want is satisfied we experienced the contentment which is called Satisfaction.Motivation implies a drive towards an outcome, and satisfaction is the outcome experienced.
77 2. Hierarchy of Needs Theory BASIC PHYSIOLOGICAL NEEDSSAFETY/SECURITY NEEDSLOVE/BELONGING NEEDSESTEEM NEEDSSELF-ACTUALIZATION
78 HIERARCHY OF NEEDS Esteem Needs Affiliation or acceptance needs for self-actualizationSecurity or Safety needsPhysiological needs
79 A Hierarchy Of Work Motivation BASIC PHYSICAL NEEDSFood, clothing, shelterSAFETY & SECURITYSeniority plans, union health insurance, employee assistance plans, severance pay, pension etcLOVE & BELONGINGFormal and informal work groupsESTEEMTitles, status symbols, promotions, banquetsSELF-ACTUALIZATIONPersonal growth, realization of potential
82 4.Herzberg's Theory of Motivation (Two Factor Theory) According to this theory, motivation is largely affected by two factors, namely:The Hygiene Factors Or The Dissatisfies.The Motivators Or The Satisfiers.
83 The Hygiene Factors Or The Dissatisfiers LeadershipRelationship With Peers, Superiors and SubordinatesWorking ConditionsSalaryCompany Policy and Administration, etc
84 The Motivator Or The Satisfiers These are factors, which give a sense of satisfaction to the employees and result in motivating them.Achievement.Recognition.Advancement.Responsibility.Challenging work.
85 Herzberg’s Two Factor Theory MOTIVATOR HYGIENE FACTORThe Job Itself EnvironmentAchievement.Recognition.Challenging work.Responsibility.Advancement.Challenging job.Company Policies.Supervision.Working conditions.Interpersonal relations.Salary /status,Security.
86 Vroom’s Expectancy Theory People will be motivated to do things to reach a goal if they believe in the worth of their goal and if they can see that what they do will help them in achieving it. In a sense a particular action will lead to a desireForce = Valance X ExpectancyForce = Strength of a persons motivation.Valence = Strength of individuals performance for an outcome.Expectancy = The probability that a particular action will lead to a desired outcome.
87 Vroom’s Expectancy Theory Recognizes the importance of:Needs and motivationThe harmony of objectives.Expectation of the rewards for the work done.Perception of value varies.Managers job to design environment.
88 McCelland's Theory of Needs Three kinds of basic motivation needs:Need for Power (N Pwrs)Need for Achievement (N Ach)Need for Affiliation (N Aff)
89 Portar & Lowler Motivation Model Value of RewardsAbility to do specified taskPerception of task requiredEffortPerformance accomplishmentPerceivedeffort – review probabilityPerceived equitable rewardsIntrinsic rewardsSatisfactionExitricis rewards
90 Equity Theory OUTCOMES BY A PERSON = OUTCOMES BY ANOTHER PERSON INPUTS BY A PERSON INPUTS BY ANOTHER PERSON
91 Reinforcement TheoryIndividuals can be motivated by proper design of their work environment and praise for their performance and that punishment for poor performance produces negative results.
92 Application Of Motivation Theories Approaches to motivation:Hierarchy of Needs.Motivation Hygiene Approach.Intrinsic and Extrinsic Motivation Approach.Achievement Motivation.Behavior Modification.Expectancy Model.
93 Special Motivational Techniques Power & Achievement.Money as a Motivator.Competition.Job design & workflow.Integration of goals.Participation.Quality of work life (QWL)
96 2. Acknowledge And Respect Their Personal Worth
97 “Treat a man as he is, and he will remain as he is; treat a man as he can and should be, and he will become as he can and should be” ….. Goethe
98 3. Recognize And Appreciate Their Efforts "Forget their mistakes and zero in on all smart things that they do right. Praise them and they’ll do more things right and discover talents and abilities they never realized they had”…….. Mary Kay Ash
103 Self Motivation Set a goal for yourself Supplement your long-term objectives with short-term goals and specific actions.Learn a challenging new task each year.Make your job a different one. Set improvement objectives for your position.Develop an area of expertise. Build on your strengths, or develop one of your weaknesses into a strength.Give yourself feedback and reward yourself.
108 Differences Between a Manager and a Leader AdministersInnovatesAssigns goals and objectivesDevelops a visionMaintain powerEmpowers peopleFocuses on systems and structureFocuses on developing peopleRelies on controlInspire trust and motivateShort range viewLong range viewAsks “how” and “when”Asks “what and why”Eye on the bottom line.Eye on horizonImitatesCreatesAccepts status quo.Challenges status quoDemand complianceDevelops commitmentDoes things rightDoes the right things
109 Leadership Is… A relationship… not a formal position. A behavior … not a function.
110 Ingredients of Leadership Power.Fundamental understanding of people and their motivation.Ability to inspire followers to apply their full capabilities to a project.The style of the leader and the climate he/she develops.
111 Traits Approach To Leadership Physical Traits.Intelligence and Ability Traits.Task Related Characteristics.Social Characteristics.
112 Key Leadership Traits Drive Motivation Honesty Integrity Cognitive abilityUnderstanding of BusinessImpact of creativityFlexibilityCharisma on Leadership effectiveness.
114 Democratic or participative leader Leadership StylesAutocratic leaderFollowerDemocratic or participative leaderFree-rein leader
115 Styles Based On Use Of Authority AUTOCRATICLEADERFOLLOWER
116 Styles Based On Use Of Authority DEMOCRATIC /PATICIPATIVELEADERFOLLOWER
117 Styles Based On Use Of Authority FREE – REINLEADERFOLLOWER
118 Theories of Leadership Leadership As A Continuum.Situation Or Contingency Approach.Path Goal Approach.Likert’s Four Systems of Management
119 Leadership As A Continuum Forces operating in a manager’s personalityForces in sub-ordinates that will affect manager’s behaviorForces in a situation
120 Contingency Theory Of Leadership People become leaders not only because of the attributes of their personalities but also because of various situational factors and the interactions between leaders and group members
121 Critical Dimensions Of The Leadership Situation Position PowerTask StructureLeader – Member Relations
122 Path Goal TheoryThe main function of the leader is to clarify and set goals with sub-ordinates, help them find the best path for achieving the goals and remove obstacles
123 Likert’s Four Systems Of Management System 1: exploitive – authoritativeSystem 2 : benevolent – authoritativeSystem 3 : consultativeSystem 4 : participative - group
124 Goal Approach To Leadership Effectiveness OrganizationLeaderBehaviorMotivatedSubordinatesFunctionsOf A LeaderCharacteristicsOfSubordinateWorkEnvironment
125 The Managerial Grid The grid has two dimension: Concern for production.Concern for people.
126 WORK AND MORALE AT BALANCE The Managerial GridConcern for productionConcern for people1.1MIN WORKMIN MORALE9.1MAX WORK5.5WORK AND MORALE AT BALANCE1.9MAX MORALE9.9LOW123456789HIGH
127 Can Leadership Be Taught? 80 percent of leadership growth derives from experience on the job.20 percent can be acquired through training and study.On-the-job training and classroom training must go hand in hand.
129 PerformancePerformance refers to an employee’s accomplishment of assigned tasks.
130 Appraisal Appraisal is the judgement of an employee’s performance in his job, based on considerationsother than productivity alone.All managers are constantly forming judgments of their subordinates and are in that sense continuously making appraisals.The term is,however, applied in Human Resource Management to “Formal and systematic assessment made in a prescribed and uniform manner at a certain time”.
131 Appraisal PeriodIt is length of time during which an employees job performance is observed in order to make a formal report.
132 Performance Appraisal It is the systematic description of the job-relevant strengths and weaknesses of an individual or a group
133 Performance Appraisal A Complex and often Misunderstood Process Performance appraisal is an exercise in observation and judgement, it is a feedback process, and it is an organizational intervention.It is a measurement process as well as an intensely emotional and human process also.
134 Performance Management Performance Management is the total process of observing an employee’s performance in relation to job requirements over a period of time and then making an appraisal of it. This is done by:Clarifying expectations.Setting goals.Providing on-the-job coaching.Storing and recalling information about performance.Counseling & Feedback.Monitoring.
135 Performance Management Process Planning Performance.Managing Performance.Reviewing Performance.Rewarding Performance.
136 Performance Management Managing performance needs appraisal.It means something very specific, and much too narrow.A process of improvement, which demands continued attention.Performance appraisal is only a part in the overall PM process.PM requires a willingness and commitment to focus on improving performance at all levels .Timely feedback and constant focus of everyone’s attention on the ultimate objective.We need to break performance appraisal orientation to performance management.
137 The Organizational And Human Contexts Of Performance Appraisal Performance appraisal is almost universal. In our contest not so well organized.Managers have limited contact with employees outside but we have no distance.Accuracy in appraisal is less important than motivating and rewarding the subordinates to most managers.Standards and ratings tend to vary widely and often unfairlyPersonal values and biases can replace organizational standards.Sometimes the validity of performance appraisals is reduced by the supervisor’s resistance to making them.Some supervisors complain that performance appraisal is pointless paperworkPerformance appraisal interfere with more constructive supervisor -subordinate coaching relationships.
138 The Process of Performance Management Needs Three Things To Be Done Well DEFINE PERFORMANCE:Set Goals.Decide How to Measure Accomplishment.Assessment of Process.FACILITATE PERFORMANCE:Obstacles.Provide Adequate Resources.Careful Selection of Employees.ENCOURAGE PERFORMANCE:Provide sufficient number of rewards that employees really value and do so in a timely and fair manner
139 Purposes of Performance Management System Provide justification for employment decisions.Provide feedback for personal and career development.Help establish objectives for training programs after identifying the development needs.Serve as-input for a formal reward and punishment system.To motivate employees to do better in present job.Used as criteria in test validation.Help diagnose organizational problems.
140 Purpose of Performance Management System Employment DecisionsPURPOSES OFPERFORMANCE APPRAISALSYSTEMDiagnosis ofOrganizationalProblemsEmployeeFeedbackObjective forTraining ProgramsCriteria inTest Validation
141 Diagnosing Organizational Problems How Done This is done by identifying training needs in terms of knowledge, skills abilities, and other characteristics to consider as a basis for distinguishing between effective and ineffective performers and using them in other decisions like hiring etc.
142 Performance Management NEW JOB REQUIREMENTSJOB DESCRIPTIONOBJECTIVESETTINGPERFORMANCE ASSESSMENTREVIEW / PLAN UPDATEPERIODIC REVIEWSCOACHING / FEEDBACKEMPLOYEE DEVELOPMENT / CAREER PLANNING PLANREWARDS & RECONGNITION
143 How does Performance Management fit into the overall company management process? Company Strategic PlansSales ProjectionsLine ExpansionsNew ProductsFacility PlansHuman ResourcesOrganization PlanningSuccession PlanningOrganizational and People DevelopmentPerformancePlanningPeriodic Reviews- Coaching & FeedbackEvaluationRewards& RecognitionEmployee Dev/Career PlanEnvironmentStylesCultureValues
144 Performance Management System The goal of performance management is to improve organizational performance by translating the organization’s strategic plan into individual employee performance planThis Needs a Proper and Integrated PMS
145 Requirements Of Effective Appraisal Systems The Fundamental requirements of any appraisal-system are:RelevanceSensitivityReliability.AcceptabilityPracticality.
146 weaknesses of each individual Relationship Of Performance Standards To Job Analysis And Performance AppraisalJob AnalysisPerformanceStandardsAppraisalDescribes workand personalrequirements of aparticular jobTranslate jobrequirements intolevels ofacceptable/unacceptableperformanceDescribes thejob-relevantstrengths andweaknesses of each individual
147 Legal Issues In Performance Appraisal To avoid legal difficulties, consider taking the following steps:Conduct a JA and determine job characteristicsIncorporate these characteristics into a rating systemTrain supervisors to use the rating system properly.Provide performance counseling or corrective guidanceFormal appeal mechanism , and higher level review.Document appraisal and reasons for termination decision
148 The Strategic Dimension Of Performance Appraisal Greatest Management Principle: The things that get rewarded get done well.Short term if rewarded will generate short term performance.When long term results required then the performance on longer periods need to be rewarded.Managers may emphasize short or long term objectives or a combination.Short term objectives - outcome as bottom line results for current quarter.Long term objectives - increase market share and securing repeat business.To be most effective, strategic management of Performance must be linked to the strategies an organization uses to gain competitive advantage eg innovation, speed, quality or cost control.
149 Types Of Review Methods Of Review Performance Review. Potential Review.Reward Recommendations.Methods Of ReviewRankingGradingBehavior ExpectationsOpen Ended360 Degree Feedback Multi-Rater.
150 Alternative Methods Of Appraising Employee Performance Behavior oriented Rating Method.Relative Rating System.Absolute Rating SystemResult orientated Method.MBOWork and Planning Review
152 When Should Each Technique Be Used If objective is to compare employees across raters for important employment decisions (e.g. promotion, merit pay) ,MBO and work planning review should not be used. They are not based on a standardized rating scheme for all employees.If a BARS is used, diary keeping should be made a part of the process. This will improve the accuracy of the ratings, and it also will help supervisors distinguish between effective and ineffective employees.If objective performance data are available , MBO is the best strategy to use.Work planning and review are not as effective as MBO.
153 When Should Each Technique Be Used Appraisal methods that are best in a broad organizational sense- BARS and MBO - are the most difficult to use and maintain .Methods that focus on describing, rather than evaluating , behavior(e.g. BARS, rating scales)produce results that are the most interpretable across raters.No rating method has been an unqualified success when used as a basis for merit pay or promotional decisions.When certain statistical corrections are made , the correlation's between scores on alternative rating formats are very high. Hence all the formats measure essentially the same thing.
154 Popularity of Appraisal Methods & Their Use Rating Scales - 51%Essays %MBOs %Other Forms - 9%
155 Who Should Evaluate Performance The Immediate Supervisor.Peers.Subordinates.Self-appraisal.Customers Served.Computers.Multi-Raters or 360 Degree Feedback.
156 Appraisal Errors COMMON ERRORS: OTHER ERRORS: Leniency. Severity. Central Tendency.OTHER ERRORS:Halo ErrorContrast ErrorsRecency Error
157 Secrets Of Effective Appraisal Interviews Frequent CommunicationTraining in Performance feedback and Appraisal InterviewingEncourage Subordinate to PrepareEncourage ParticipationJudge Performance , Not PersonalityBe Specific, and Be an Active ListenerAvoid Destructive CriticismSet Mutually Agreeable GoalsContinue to Communicate, and Asses Progress Toward Goals RegularlyMake Organizational Rewards Contingent on Performance
158 Impact Of Performance Appraisal On Productivity, Quality Of Work Life, And The Bottom Line Performance appraisal is a feedback process.Feedback increases performance by 10 to 30 percent.”Feedback is a fairly inexpensive way to improve productivity; but, to work effectively, it requires sustained commitment.The cost of failure to provide such feedback may result in the loss of key professional employees, the continued poor performance of employees who are not meeting performance standards, and a loss of commitment by all employees.The myth that employees know how they are doing without adequate feedback from management can be an “expensive fantasy”.
159 Implications For Management Practice The difficulty of implementing and management of performance appraisal systems.To improve policy issues for improvement in PMS make “quality of performance appraisal feedback to subordinates” and “development of subordinates” integral parts of every manager’s job description.Tie rewards to effective performance.Recognize that performance appraisal is a dialogue involving people and data; both political and interpersonal issues are involved.No appraisal method is perfect, but with management commitment and employee “buy-in” performance management can be a very useful and powerful tool.
160 Impact Of National Culture On Organizational Performance Appraisals Less support for performance appraisal as practiced in Western culturesMore focus on group rather than individual performanceGreater willingness to consider nonperformance factors(e.g. off-the-job behaviors, age) as criteria in appraisalLess willingness to attribute performance levels to the skills and efforts of particular individualsMore open and direct relations between supervisor and subordinateAn expectation of closer supervisory styles.To forgive, forget and be generous on employee expectations.
162 Complexity Of Performance Management Performance Management includes issues as:Developmental (feedback)Technical aspects (Design of an appraisal system)Interpersonal Aspects (Appraisal interviews)Administrative (Pay, Promotions)This makes it extremely complex.
163 Linking Performance Management with other key areas Performance PlanningPerformance Feedback & CoachingPerformance EvaluationImplementationSkills Gap AnalysisTraining Needs AssessmentEmployee Development Plan
164 Performance Management System “Is a means to create and maintain a climate of success in the organization.” …Martin Fisher, “Performance Appraisals”This means a Win-Win relationship with employees&Sharing the business success all the way
165 The Executive Appraisal Paradox Executive ParadoxStructured performance reviews not likedFormal review below dignityToo busy to conduct appraisal.Autonomy and creativity in executivesResults the only basis for assessingComprehensive evaluation impossible via formal performance appraisal
166 Answer To The Executive Appraisal Paradox A formal, systematic executive appraisal process is a must.Incorporate formal performance planning.Make performance review and appraisal an ongoing process.Focus on process as well as outcomes during the executive review.Be as specific and thorough as possible.