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Corporate Performance Measurement and Management at M.P.S

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1 Corporate Performance Measurement and Management at M.P.S
ROMY FELIX – HEAD HRD 1

2 Agenda Introduction to Corporate Performance Management
Individual Performance Management Definition: Competencies Organisational and Individual Competencies Competency framework Why Develop a Competency Framework Approaches to Competency Profiling Competency & Skill library features and Benefits Steps for implementing a Competency & Skills library Examples Definition: Job Profiling Process for Creating a Job Profile Examples and Templates ROMY FELIX – HEAD HRD

3 Performance Measurement
What gets measured gets done and … What gets measured becomes important! ROMY FELIX – HEAD HRD

4 Performance Management – the linking pin !
Starting with the ultimate goal and mission of the organisation. Aligning the business units, teams and individuals Vision Strategy Processes Systems Performance Management Behavior and Actions Results ROMY FELIX – HEAD HRD

5 What employees look for – the linking pin!
Understand what is expected form them This will lead to aligning individuals towards achievement of organisational goals Vision Strategy Processes Systems Performance Management Behavior and Actions Results ROMY FELIX – HEAD HRD

6 What does Performance Management Involve?
Achievement of strategic goals & objectives Allocation of KPI’s Facilitate employee personal development as part of a integrated process Understanding true strengths and weaknesses at every level of the organisation Transformation of people management into a result-driven, strategic business function Alignment of employee goals and actions with corporate strategy Retention of top performers and development of low performers Increased quality and frequency of communication between managers and employees ROMY FELIX – HEAD HRD

7 CEO Questions Have I set the right organisation goals to achieve my strategy? There must be a more systematic approach we could use for goal setting. What kind of behaviors and skills and focus should I be directing my employees to have in order to achieve these goals? Does anyone know what behaviors will most likely help to improve our financial performance or improve customer satisfaction? Do the employees understand my vision and strategy? Have they been clearly communicated? Do employees buy-in to these goals and do they understand and buy-in their role or their divisions role in meeting the strategy? ROMY FELIX – HEAD HRD

8 CEO Questions Cont., Is my company structured optimally to fulfill our Strategy? Have we set up a performance incentive system that aligns with our organisation strategy? Does it include objectives that our staff care about? Do I have the right tools, systems and processes in place, both formal and informal to support performance related communication? Isn’t there some form of automation that can give me more detailed, relevant information. ROMY FELIX – HEAD HRD

9 Performance Management
May the most agile win … ROMY FELIX – HEAD HRD

10 Measurement and Performance
There are some questions that are relevant for business: Do we attract and retain the right people with the right skills? Are we performing effectively in our operations to produce and deliver to our stakeholders? Are we meeting or exceeding our stakeholders expectations? How are we doing financially? Margins? Costs? Revenues? New business revenues? ROMY FELIX – HEAD HRD

11 What is a Balanced Scorecard?
Components: Mission, Vision, 4 dimensions Financial Stakeholders Processes Organisational learning Departmental goals and objectives Key success factors Key performance indicators, KPI’s Strategic Initiatives, projects and programs ROMY FELIX – HEAD HRD

12 Integrated and Balanced Management Approach
Perspective Strategic Objectives Measures Targets Owner/Account-ability Initiatives Financial Shareholder value Profit New revenue Shareholder Equity Operating margin Revenue from new services R X million in 3 years RPI + x% annually 25% in three years Finance Dir. CEO Business Dev. Mgr Implement Economic Value Added Customer Differentiation Strategic alliances Customer service Value for money Profits from alliances Customer satisfaction Number one customer rating R x million in five years Marketing Dir Bus. Dev. Mgr. Create customer Segmentation model Redefine channel strategy Business Processes Productivity New product devt. Segmentation Revenue/work hour Product development cycle time Number of initiatives targeted at profitable segments Best-in-class within five years Reduced by 50% in two years 60% within one year COO R&D Manager Marketing Dir. Reengineering new product development process Learning & Innovation People policy Alliance Mngnt Customer focus Management span of control Number of “learning partnerships” % management time interfacing with cust. Triple in three years 10 in five years 20% in two years Human Res. Dir. Develop new HR strategy Implement performance based compensation program This prioritised set of initiatives defines the executive agenda and should support the planning and budgeting process. Conversely, senior management should call into question any initiatives inconsistent with the strategic objectives. ROMY FELIX – HEAD HRD

13 So far so good …….. But ….. Is there any difference between organisational and individual performance management? Where should management put more attention to when managing performance? At the end …what is performance management? ROMY FELIX – HEAD HRD

14 Importance of People in Driving Performance
Where is the intelligence and talent of our organisation? Systems and Structures People What do you pay more attention to? Organisation charts Systems Technology Procedures Leadership Learning Communication PERFORMANCE MACRO MICRO ROMY FELIX – HEAD HRD

15 Defining Individual performance
Management Support and tools Competencies, knowledge and skills KNOWLEDGE I know how to do it CONTEXT I know what to do WILLINGNESS I want to do it Motivation Performance: Those behaviours, that under the right conditions, lead to the expected results ROMY FELIX – HEAD HRD

16 The need to cascading down to level n…
Value for clients, stakeholders And employees Organisational Strategies Divisions, Sections, Programs Plans etc Individual Action Best Practices In value based managed enterprises, individual employees understand how processes and day-to-day activities contribute to value creation They know what they have to do individually to contribute to value creating This value creation focus becomes the basis for determining appropriate performance measures and enables to differentiate between what could be measured and what should be measured (Business Balanced Scorecard Concept) ROMY FELIX – HEAD HRD

17 Individual performance management infrastructure
Roles & Responsibilities Annual objectives and feedback Competencies model Organisation Structure Compensation & Incentives Career Development Training & Education Recruiting & Selection Integrated People Management Process ROMY FELIX – HEAD HRD

18 COMPETENCY MANAGEMENT PERFORMANCE MANAGEMENT
Performance Management System Individual Goals Team Goals Corporate Goals Individual Competency Competency Mix Core Capabilities & Key Competencies GOAL MANAGEMENT COMPETENCY MANAGEMENT PERFORMANCE MANAGEMENT ROMY FELIX – HEAD HRD

19 Competencies…. ROMY FELIX – HEAD HRD

20 What are competencies? Competencies are a set of behaviours that encompass skills, knowledge, abilities, and personal attributes that, taken together, are critical to successful work accomplishment. ROMY FELIX – HEAD HRD

21 Organisational and Individual Competencies
Organisational Competencies: Pinpoints the most critical competencies for organisational success. These are an organisation’s core competencies. Individual Competencies: Those competencies that each employee brings to his or her function. ROMY FELIX – HEAD HRD

22 What is a Competency Framework?
A Competency Framework is a map to display a set of competencies that are needed to achieve an organisation’s mission, vision, and strategic goals. A Competency Framework is future-oriented, providing a master of core individual competencies required to develop the ideal future workforce. The competencies that make up the framework will serve as the basis for future employee management, since they play a key role in decisions on recruiting, employee development, personal development, and performance management. ROMY FELIX – HEAD HRD

23 Why a Competency Framework?
A Competency Framework will help to bridge the gap between where the organisation is now and where we want to be in the future. This occurs in two ways. Serves as a guide for management in making decisions, since it is based on the competencies that support the mission, vision, and goals of the organisation. Serves as a map to guide employees towards achieving the mission of the organisation and their functional areas. ROMY FELIX – HEAD HRD

24 Approaches to Competency Profiling
Two approaches to competency profiling: Top-down approach: Generally involves picking, based on a strategic analysis of the organization's performance objectives, an array of competencies from a dictionary of competencies and assessing those for a particular position or class of positions. Bottom-up approach: Involves exploratory checklist surveys and subsequent confirmatory interviews to derive the competencies from employees. ROMY FELIX – HEAD HRD

25 Functional Competencies
Administrative Knowledge Business Acumen Computer Filing Financial Health & Safety Knowledge and Skills Human Resources Industrial Relations Legal Knowledge Management Information Marketing/Sales Procurement Quality Knowledge and Skills Security Typing ROMY FELIX – HEAD HRD

26 Task and Leadership Competencies
Analytical Ability Assertiveness Conflict Handling Customer Focus Decisiveness Flexibility Individual Leadership Initiative Judgement Leadership of change Negotiation Skills Oral Presentation Oral Persuasiveness Performance Orientation Persistence ROMY FELIX – HEAD HRD

27 Task and Leadership Competencies
Planning/Organising/Control Self-development orientation Strategic and Global Perspective Team Leadership Values Verbal Communication Written Communication ROMY FELIX – HEAD HRD

28 Competency & Skill Library Features & Benefits
Comprehensive Library No need to “reinvent the wheel.” Allows a quick start. Completely customisable: Create new skill groups, skills, and sub-skills as needed Create Common or Unique Performance Levels Define different levels of competence (for example, from beginner to expert) for each competency, or use one scale for all Input Performance Targets Identify performance expectations for each competency/skill group for entry level up to senior management ROMY FELIX – HEAD HRD

29 Competency & Skill Library Features & Benefits
Define Behavioural Indicators If desired, enter behavioural examples/targets for competencies and skills Continually Enhanced and Grows in Value The library is easily enhanced as a by-product of job profiling, performance planning, and employee development Fully Integrated with Other HR Functions Your competency/skill library is used in every other function of HR, it ties them all together, and allows consistency throughout all of your performance management and developmental programs ROMY FELIX – HEAD HRD

30 Steps for Implementing Competency & Skill Library
Step 1: Review provided library; eliminate competencies and skills that are irrelevant to the organisation Step 2: Select core competencies based on organisational strategy and values Step 3: Departments review list of competencies and skills for their function and add additional competencies and skills as they are needed Step 4: Library grows naturally as new skill needs are identified while building job profiles, performance, development, or succession plans ROMY FELIX – HEAD HRD

31 Example ROMY FELIX – HEAD HRD

32 Example ROMY FELIX – HEAD HRD

33 Example ROMY FELIX – HEAD HRD

34 Example ROMY FELIX – HEAD HRD

35 Example ROMY FELIX – HEAD HRD

36 Example Example of Competency Assessment Process
Step 4: Assess Competency Level Achievement Competency Assessment Competencies Required Level of Complexity [Refer to Competency Framework] Employee’s Rating Actual Rating GAP Developmental Requirements Business Acumen 4 3 -1 Work towards attaining required level. [Refer to Academy, or engage in formal training, e.g. Advanced Management Programme, UNISA] Marketing/Sales Investigate marketing & sales activities in BU. Report back in 3 months for actions to be taken after discussion with Reviewer Financial Requires training on financial modeling. Recommend that Academy module on Financial Modeling be taken. Industrial Relations Example ROMY FELIX – HEAD HRD

37 Job Profiling… ROMY FELIX – HEAD HRD

38 What is Job Profiling Job Profiling is a systematic procedure for identifying the Competencies critical for success in a particular job or a job role. Job profiles can then be used for recruitment, selection, performance review, promotion, career development and succession planning. ROMY FELIX – HEAD HRD

39 Job Profiling Procedure
Step 1: Obtain background information about the job to be profiled and how that job fits into the organisation. Step 2: Develop an initial list of the tasks most relevant to the job being profiled. Step 3: Meet with subject matter experts (SMEs)—incumbent workers or supervisors of the job being studied—who review and revise the list, adding, deleting, consolidating, or changing the wording of each task to make sure that the list of tasks accurately represents the job as it is performed in the organisation. ROMY FELIX – HEAD HRD

40 Job Profiling Procedure
Step 4: Present detailed descriptions of each of the Analytix Competency Framework to the SMEs. The SMEs decide, as a group, which competencies are relevant to the job and which skill levels are necessary for entry into the job and effective performance in the job. Step 5: The final product of the profiling procedure is a report listing the most critical tasks an individual in that job must perform and, for each relevant Analytix competency, the skill level required to perform the job. ROMY FELIX – HEAD HRD

41 Example ROMY FELIX – HEAD HRD

42 Example ROMY FELIX – HEAD HRD Operational objectives Executive Role
Represent Finance & Funding and provide strategic input and value add at EXCO, ABCC Board Meetings, Board Committee Meetings, External Boards, Divisional Merit Committee Meetings, and facilitate the implementation of Executive/Board decisions. Leadership Effectively provide leadership in the Finance & Funding Division and participate in executive decision-making and leading of division and SBU’s: Effective PM Enhance performance culture in Division and SBU’s by successfully implementing the enhancements of the ABCC Star Performance Management Project: Long-term strategic objectives Financial Mngmnt Effectively manage and monitor all activities that may have a financial impact on the IDC: Ensure timely and accurate budgeting and financial reporting on all the IDC’s financial matters, including the subsidiaries Enhance financial reporting functionality at SBU level to include Profit & Loss and Balance Sheet reports There is adherence to the PFMA and other regulatory reporting requirements Company and external auditors are satisfied that proper treatment of transactions were made (including tax) Strategic Initiatives Ensure the ABC’s ability to fund all financing activities through effective utilisation of cash resources (including borrowings) as determined by it’s mandate through provision of loan finances, leased buildings, suspensive sales, plant leases, guarantees and the provision of ordinary preference share capital ABC’s Credit Rating Ensure that the Moody’s rating of the ABC, to be obtained by June 2003, is at least maintained or improved to ensure IDC access to competitive funding Liquidity Establish and implement programs to protect the IDC’s capital in place through management and realisation of the Mature Holdings to enable the Corporation to remain within it’s limit, and to ensure a ready income stream, and a debt: equity ratio below 60% Attractive Longer term funding Enable IDC access to attractive priced longer term funding by developing and maintaining relationships with a number of international development finance institutions, including European Investment Bank, DEG, Proparco, and Japan Bank for international Co-operation relationships with leading DFI’s. Example ROMY FELIX – HEAD HRD

43 Example Example of Individual Target Setting
Step 3: Set Measurable Targets for Individuals Department Programme Personal development needs and aspirations Team objectives Individual objectives Self Manager Target Result Weighting Assess Assess Final % 1 – – Objectives Example Grow net new money excluding market growth by the end of Q4 2001 10% 6% 40% 4 3 3 Improve client satisfaction feedback by setting up an appropriate survey by Q3 2001 Survey set up 40% 4 4 4 Improve capabilities in client service by attending course by end Q4 2001 Attended 20% 2 4 3 ROMY FELIX – HEAD HRD

44 Example ROMY FELIX – HEAD HRD Parameter Performance Standard
Measurement Weight Executive Role Represent Finance& Funding and provide strategic input and value add at Board, EXCO, Board Committee Meetings, External Boards, Audit and Merit Committee Meetings, and facilitate the implementation of Executive/Board decisions. Divisional Merit Committee Evaluation 20% Divisional Leadership Effectively provide leadership and guidance to SBU Heads in policy and operations, and implementation of strategy and business plans and participate in executive decision-making Subordinates Evaluation Effective Performance Management Enhance performance culture in Service Sector Division and SBU’s by successfully implementing the enhancements of the IDC Star Performance Management Project by June 2003. VP Human Resources Evaluation Financials and Compliance Ensure accurate and timely quarterly, 6 monthly, and annual budgeting and reporting Chairman of Board Audit Committee Evaluation 10% ATG and EXIM Ensure Division’s contribution to successful roll-out of ATG and successful implementation of EXIM project by June 2003 CIO Evaluation Corporate Support Effectively manage the corporate support function, including maintenance of buildings and infrastructure, Infrastructure, secretarial division, dematerialisation of shares Sample VP and SBU Head satisfaction survey Moody’s Rating Successfully manage the IDC’s application in obtaining a Moody credit rating by June 2003 CEO Evaluation 100% Example ROMY FELIX – HEAD HRD

45 Example ROMY FELIX – HEAD HRD

46 Example ROMY FELIX – HEAD HRD

47 Example ROMY FELIX – HEAD HRD

48 Thank you ROMY FELIX – HEAD HRD


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