1. Enhancing Organizational Performance
Manager’s Session

2. Agenda Overview of Enhancing Organizational Performance process
Roles of Line Managers, Functional Managers, HR
EOP communication plan
What drives superior performance
Creating effective development plans
Planning and managing the performance improvement conversation
Tracking employee progress and next steps
Resources
Q’s & A’s

3. EOP Overview

4. EOP Overview
What is Enhancing Organizational Performance?
A management-driven program focused on continuous improvement of the workforce.
Was developed to drive:
A standard approach to performance management
A focus on identifying and addressing development needs
A clear link between performance and rewards/advancement.

5. EOP Overview Why are we doing it?
Enhancing organizational performance by continuous improvement.
Management initiative that is designed to sustain our business competitive edge.
Provides an opportunity to assess and address performance gaps earlier.
Provides a more objective and uniform method of evaluating employees across the organization.
Provides functional review of employees across organizational lines

6. EOP Flowchart for OOGC EOP Training Assessment Assessment to HR
Employee Development Grid
Functional Review & Reconciliation
Funct. Mgrs./Line Mgrs.
Development Form Development Tools
EOP Training
HR Mgrs. or external
Development Form Communication Guidelines
Under-Performers Improved?
YES NO
Assessment
Line Mgrs.
Assessment to HR
Final Assessment to HR
Developmental Action Plan
Line Mgrs./Funct. Mgrs.
HR Consolidates
OOG HQ HR
DevPlan Needed / Desired?
Informal Coaching
Implement Plan / Follow Up
Line Mgrs./Employees
Communication of DevPlan
Document
& Next Steps
HR Mgrs./Line Mgrs.
Ongoing Coaching / Development
QBR Review
Identify Dev. Trends
E&OD
Next Cycle
Employee Input
(Gained from DAP discussion, previous input, 360°, etc.)

7. EOP Overview
PMP Tools
Employee Performance Grid: Assesses employees in relation to two dimensions:
Objectives (Performance Results)
Critical Skills, Knowledge, Behaviors (includes Functional Competencies)
Functional Competency Matrix
Provides benchmark levels of critical knowledge, skills, and behaviors that are key to successful performance.

9. OOGC PMP Process Evaluation Coaching / Support Direction Impacts OOGC•
Mission
Strategies
Performance Goals
Team Objectives Setting
Review OOGC Performance
Goals
Review last year’s
accomplishments
Department/Team develops
goals and objectives
Establish priorities,
accountabilities and timetables
Individual Objectives Setting
Prepare for individual goal setting
discussion
Conduct discussion and document
agreed upon objectives
Ensure alignment with Team Goals
Employee develops action plans as
needed
Team Performance
Review
Summarize
Discuss helping factors and
barriers toward achieving
results
Document results
Individual
Performance
Prepare for discussion
Review and discuss
Identify developmental
needs
Jointly capture results
Supervisor involves next
level manager in
evaluation
Progress Review
Team and Individual
Review and revise
objectives/goals as
appropriate
Coaching
Provide ongoing feedback
on accomplishments and
areas needing
improvement
Recognition
Considerations
OOGC Mission and
Strategies, Performance
Prior Year Results
Resource availability
Risks and Opportunities
OOGC Performance
Team Goals
Job analysis
Previous Performance
Reviews
Strengths/Areas for
Improvement
Developmental Needs
Impacts
Career
Development
and Training
and Rewards
Organizational
Succession
Planning
Evaluation
Coaching /
Support
Functional Excellence
Grid
Performance Results
Leadership/Individual
Competencies
360 Feedback as
Functional concurrence
Outputs
Appraisal
Employee

10. EOP background 2001-2002 Standard approach to performance management
A focus on identifying and addressing development needs
A clear link between performance and rewards / advancement
Continuous improvement in performance – “Raising the bar”
Continuous improvement in performance – “Functional Training Initiatives”

11. EOP
Continuous Improvement: Increasing expectations over time, and then performing to those expectations. Continuous improvement is supported by the Functional Training Initiatives.
Assumptions
Upward movement on 'X' and 'Y' axis
Stretch performance goals
New skill
Expect incremental gains, not quantum leaps
Coordinated, concurrent individual improvement lifts the organization
Simple enhancement of existing performance management process

12. Ground Rules
Applicability – all exempt US dollar and all exempt national employees (non-exempt employees is optional)
Baseline of “good” job performance is accomplishing and sometimes exceeding base objectives
In absence of a clear assessment, rate new hire (< 3 months) a ‘5’.
No forced ranking but distribution expected
All goals discussed and documented as part of annual goal setting.
Achieving stretch goals is not a “box raiser”; significantly exceeding them might be.
Achieving regular goals, but not stretch goals could eventually cause you to drop in rating.
Stretch performance goals not easily displaced by conflicting priorities.
Challenge of significant job change may displace these goals.

13. Ground Rules – Yellow Boxes
Employees new to job are not automatic yellow boxes.
Failure to meet regular job goals moves you into yellow box
All yellow box performers are required to have a written and signed Development Plan
Individuals in yellow boxes are not given stretch goals until performance dictates
No forced ranking; it’s measurement against expectations (make sure expectations are high enough!)

14. Measurement and Accountability
Requires rigor in setting goals and assessing performance
Annual Reporting
3 Components
Rating on EOP Grid
'X' Stretch Performance Goal met (yes or no)
'Y' Skill Goal met (yes or no)
Binary measure, Yes or No. No partial or not clear options.
Information consolidated and reported at QBR for commentary and discussion. (Business Unit, Asset, Function)

15. Implementation Schedule (1)
Nov 01– Dec 09
Complete performance/skill assessment. Ratings due to Local HR
December 09
Employee ratings entered in Peoplesoft
December 12
Employee ratings due to corporate HR
Dec 12 – Jan 13
Corporate Functional review of performance ratings
Dec – Mar 31
Development Plans & Discussions for employees rated bellow 5

16. Pre-requisites
All employees have goals and objectives formally defined – either team or individual.
All employees have an annual performance discussion.
All employees have an annual development discussion.

17. 'X' Axis – Stretch Performance Goal
Stretch performance goal clearly beyond regular job expectations
Can be an individual or team goal
Measurable, with clear timelines for completion (or milestones, if multi-year effort)
Driven by line management
Stretch Performance Goal – ‘X’ Axis
The stretch performance goal is driven by Line management and should clearly be different from an employee’s regular goals; not part of what is normally expected for success in their current job. These goals can be individual or team goals, and should be measurable with clear timelines for completion or milestones, if a multi-year effort. Examples include:
Step-change improvement in efficiency, quality, cost
Launch a sustainable new initiative
New participation in a significant cross-functional activity
Does not meet objectives
Consistent
ly meets and
Consistently exceeds objectives
sometimes exceeds objectives
Performance Results
(Quality, Quantity, Impact and Alignment)

18. 'Y' Axis – Skill Goal
Priorities/options framed by functional leadership. Functional expertise is a building block for line performance
Implemented by Line management in consultation with Function.
Specific new skill or step-change in existing skill
Clear job/business application leading to improved effectiveness and contribution.
Skills above
current grade
level
Skills at
current grade
level
job skills, knowledge, and behaviors that are important to
he employee’s position within the function
Employee Skills
New Skill Goal – ‘Y’ Axis
The new skill or step-change in existing skill goal should have a clear job/business application leading to improved effectiveness and contribution. Functional expertise is a building block for line performance; therefore, priorities/options for new skill goals are framed by functional leadership and implemented by Line management in consultation with function. New skill goals will be communicated annually through function and could be presented as a menu of items or a major initiative.
Skills below
current grade
level

19. Roles and Responsibilities

20. Role of Line Managers / Supervisor
Provide assessment of employee in performance grid
Reach consensus with Functional Manager on employee assessment and development plan
Conduct performance feedback conversation with employee
Engage in continuing dialogue with Functional Manager about employee’s progress
Develop action plan with employee to address development needs. For Under / Questionable performers (Yellow Boxes), develop a written Development Plan. A signed copy must be provided to HR.
Document action plan and employee progress
Conduct follow up meetings with employee to assess progress
Involve HR if employee is not progressing to meet expectations
Ensure employee goals include one Stretch Performance Goal and one new Skill Goal.

21. Role of Functional Managers
Provide assessment of employee in Functional Review
Reach consensus with Line Management on employee assessment and development plan for Under / Questionable performers.
Engage in continuing dialogue with Line Manager about employee’s progress
Follow up on development actions as appropriate
Provide opportunities for technical knowledge sharing and coordination of technical resources to support employee development actions
Work with business unit leaders to identify and implement broad skill development priorities / options for ‘Y’ axis new Skill Goals.

22. Role of HR Coordinate employee assessment and schedules.
Training for managers in EOP process
Provide one-on-one coaching for manager and/or employee as needed
If requested provide support for identified development activities.
Provide support for identified development activities if requested
Provide counseling to manager on next steps if employee performance does not improve to meet expectations

23. EOP Communication plan

24. EOP Communication Plan
Reacquaint employees with PMP program – planning, review, evaluation, and ongoing coaching
Explain Employee Performance Grid as an additional tool for assessment of skills in addition to assessing results
Increased emphasis on accountability for development plans
Provide frank, honest communication on the results of employee’s assessment
Does the employee meet the objectives (performance results), and
Does the employee demonstrate the knowledge, skills, functional competencies, and behaviors that are key to successful performance for the grade level of his/her function or job family?

25. EOP Implementation Guidelines
Development plans will be required for all employees assessed as under or questionable performers
Development plan will include specific development needs and action steps with timeframes
Employees will be expected to show demonstrated improvement within 12 months or less
Employees assessed as under-performers will be required to significantly improve performance within 12 months or less or face possible termination

26. What Drives Superior Performance
Principle Driver - Manager
Principle Driver – Employee
Expectations
People need to understand the organization’s direction
People need to understand their job responsibilities
People need to understand business changes and how they impact changes in expectations
Feedback
People need ongoing, timely feedback
Resources
People need to have the information and resources to do their jobs effectively
Training and Development
People need the opportunity to grow in their current job
The manager and employee need to partner in the employee’s professional development
Selection & Job Assignment
People need to be matched to the right role for best use of their talents and skills.
Motivations
People need reinforcing feedback when they do something well and redirecting feedback when there is an opportunity for improvement.
People need to be able to contribute fully in team and group meetings.
People need to know what they do make a difference; they need to feel valued, listened to and appreciated for their contributions.
Source - Gallup

27. FREQUENTLY ASKED QUESTIONS FAQ’s

28. What is the Employee Performance Grid?
The employee performance grid is a two-dimensional tool designed to guide performance and developmental discussions with employees in relation to:
Performance Results which is defined as performance against goals/objectives (the “what”)
Employee Skills which is defined as the job skills, knowledge, and behaviors expected at the employee’s grade level (the “how”)

29. Why we have implemented EOP
EOP has been developed to drive:
A standard approach to performance management
A focus on identifying and addressing development needs
A clear link between performance and rewards / advancement
Continuous improvement in performance and development – ”Functional Training Initiatives”

30. What is the major purpose of the Employee Performance Grid?
The grid was created to provide supervisors with a communication tool to guide performance discussions and development planning with employees.

31. What do the numbers in the boxes mean?
The numbers are there simply for convenience and consistency in referring to a particular box.
The numbers are not meant to be sequenced, and have no inherent meaning (letters, roman numerals, or any other symbol would have served the same purpose).

32. What is the required distribution of employees among either boxes or colors?
There is no set distribution, however we would expect to see ratings distributed across the grid.
In the last staff meeting PM mentioned that he expect to have an overall distribution 10 – vs last year distribution 3 – 96.5 – 0.5

33. Is there a specific rating form that will be utilized in conjunction with goal setting?
Goals should be documented. There is not a specific form to use; each Business Unit will determine what format will be utilized for documenting employee performance.
In the last staff meeting PM mentioned that he expect to have an overall distribution 10 – vs last year distribution 3 – 96.5 – 0.5

34. Should an employee’s mobility be a factor in determining their placement on the Grid or performance evaluation?
No. However, exposure to different jobs in different locations is helpful in developing skills and it could be an expectation for certain positions, therefore, the employee’s ability to be mobile could affect their overall performance.

35. None of the descriptions in the boxes perfectly fit a particular employee. What should I do?
Choose the box that best fits. During
your discussion, help the employee understand
your thought process for their placement on
the Grid.
Focus the discussion on demonstrated
examples of meeting, exceeding or not meeting
goals and the skills that are expected of their
position and grade level.

36. How do I rate new employees and recent transfers?
Employees new to their job should be included in the review process. In the absence of a clear assessment, new hires (< 3 months) should be rated a 5.
If an employee transferred in from another Oxy location, department or function during the prior three months, the previous supervisor should be consulted to assist in determining this year’s rating.

37. What is the major difference between Box 6 and Box 8?
Both Box 6 and Box 8 are labeled as “Strong Performers”.
Box 6 describes individuals who are consistently meeting and sometimes exceeding their performance objectives and may have potential beyond their current position.
Box 8 describes individuals whose performance consistently exceeds expectations and their skills are at grade level at the present time.

38. Does evaluating an individual in Box 6 or 9 indicate that he/she is ready for a ladder promotion?
Not necessarily, a rating in Box 6 or 9 indicates the individual possesses skills above his/her current grade level. Many times, promotions involve broader considerations.
Interpretations is that the employee should possess a significant number of skills above the current grade level, not just one or two. A thorough evaluation needs to be made in conjunction with function.

39. Does a recently promoted individual automatically move from a box 6, 8, or 9 to a box 4 or 5?
No. An individual should be rated against the performance and skills expectations appropriate to their tenure on the job

40. Should I show my employees the Employee Performance Grid?
Yes. During the Performance and Development discussion, the Employee Performance Grid should be used as a communication tool.
The performance discussion should focus on communicating and providing examples of how the employee is meeting, exceeding or not meeting goals and the skills expected of the employee’s position and grade level.

41. Should a rating be communicated back to the individual?
Present the EOP Grid to employees without numbers or labels. Performance discussions should be focused on the box description.
If you think that the employee is really concerned about his/her score, tell him/her but Only after you have already explained his her assessment.

42. How will our EOP objective for continuous improvement of the OOG workforce be achieved?
To facilitate continuous improvement of the workforce, we will add two new challenges to the current goal setting and development planning process for exempt employees:
A stretch performance goal beyond current job requirements
A goal to develop a new skill or step-change to an existing skill.

43. What role does functional management have in defining these new challenges?
New skill development goals (‘Y’ axis) are designed to enhance an individual’s functional skills. Therefore, functional management will work with business unit leaders to identify broad skill development priorities/options that could be addressed in a skill goal.
Stretch performance goals (‘X’ axis) are primarily driven by line management.

44. What is Functional Competency Matrix?
A tool that provides benchmark levels of critical job skills, knowledge, and behaviors that are key to successful performance to the employee’s position. Matrices have been developed for the Geoscience, Geoscience Tech, Engineering, Land, HES and HR functions. There may be others available in the future.

45. What effects do stretch performance and skill goals have on an employee’s placement on the Employee Performance Grid?
Achieving your stretch performance and skill goals is not a “box raiser”; significantly exceeding them might be.
Achieving regular goals, but not stretch goals could eventually cause a drop in rating.
Completion of an employee’s stretch goals is mandatory for consideration of placement in a 6, 8 or 9 box.

46. Can I conduct the Performance Discussion and the Development Plan at the same meeting?
Yes. Since the Employee Performance Grid is designed to address the two dimensions of Performance Results and Employee Skills, it is an ideal tool to assist you in discussing both topics in the same meeting.
Make sure you have Functional concurrence before communicating an employee’s placement on the Employee Performance Grid.

47. Who is accountable for development?
Ultimately, the employee is accountable for his/her development, but the supervisor may be accountable for providing the opportunities, resources, and support required to accomplish the development action.

48. Do I have to do a formal, written Development Plan for all employees?
No. Only employees identified as Under/Questionable Performer (yellow boxes) will require a written and signed Development Plan.

49. Should we establish stretch goals for employees that are rated as an Under/Questionable performer?
No. Their focus should be on performance and / or development of skills required for their current job before focusing on new challenges.

50. Does evaluating an individual in Box 6 or 9 indicate that he/she is ready for a ladder promotion?
Not necessarily, a rating in Box 6 or 9 indicates the individual possesses skills above his/her current grade level. Many times, promotions involve broader considerations.

51. I am uncomfortable giving feedback to my employees. What should I do?
One of the toughest parts of your job as a manager may be giving direct, constructive feedback. When having developmental discussions with employees, try the following:
Stick to the facts. Observable behavior is difficult to argue with.
Provide feedback when the behaviors occur. Don’t wait to provide feedback once a year.
Ask the employee for suggestions on how to improve their skills or performance.
Ask your HR representative for help preparing for the discussion.

52. Should I rate my non-exempt / hourly employees on the Employee Performance Grid?
Each business unit/location will make a determination of how their non-exempt / hourly employees will be evaluated, keeping in mind that all employees are to have a Performance and Development discussion at least once a year.
Note: Non-exempt employees who are Under/Questionable performers are required to have a written and signed Development Plan.

53. How is employee performance linked to Compensation?
Market pay and performance are the main foundations of our compensation program. The goals of our compensation program are:
to compete in the marketplace for essential skills and exceptional talent,
be closely linked to actual results and to help drive superior business performance, and
to clearly differentiate pay based on individual contribution and personal commitment.
Within a salary grade range Top performers have a higher pay target than Strong performers; Strong performers have a higher pay target than Good performers; Good performers have a higher pay target than Questionable performers. The annual salary planning guidelines include a performance-based planning model that is designed to clearly differentiate between these different levels of performance.
The salary planning model, which considers range in position, performance level, and the availability of funds, is an aggressive mechanism for bringing pay to the appropriate target level based on individual performance.

54. Creating effective development plans

58. Assessing Key Developmental Needs
Know How: Skill
Does the employee possess the skills required for the role?
Know What: Knowledge
Does the employee lack knowledge or awareness of what needs to be accomplished in the role?
Know Why: Motivation
Does the employee understand the expectations of the role and the rewards of meeting those expectations? Does the employee understand the consequences of not meeting expectations?

59. Possible Development Actions
On-the-job development activities
Review expectations
Review role and responsibilities
Short-term projects
Partner employee with a peer coach/mentor
Special assignments
Conduct skills assessment
Specific on the job skills training
Role redesign or reassignment
Seek HR counseling with employee
Supplemental Training
Least effective for quick performance improvement
Should be focused on employee’s growth rather than addressing significant performance gaps

60. Advantages of OJT vs Classroom Training
We remember:
10 -15% of what we hear
% of what we hear and see
% of what we say
% of what we do
75+% through supervised coaching
Source - Gemini

61. Who is Accountable
Ultimately, the EMPLOYEE is accountable for his/her development, but you and others may be accountable for providing the opportunities, resources, and support required to accomplish the developmental actions.
Document any additional accountabilities.
Examples:
Line Manager
Functional Manager
Peer coach/mentor
Technical expert
Project Lead

62. Planning and managing the performance improvement conversation

63. Communication of Development Plan Agenda
Build Shared Understanding
Review agenda with employee
Clarify your desired outcome for discussion
Create alignment
Provide specific, candid feedback on performance gaps
Describe specific behavior changes or results that are expected
Get employee’s agreement on identified gaps
Ask for employee’s input on how to address gaps
Finalize action plan on how to address gaps with target completion dates
Utilize eAdvisor as a tool in developing action plan
Closure and Next Steps
Review what the employee has committed to do to correct gaps
Offer your support to help employee address gaps
Reinforce your expectation that the employee maintain behavior/performance changes for his/her continued success
Review rewards of meeting expectations and consequences of not meeting the expectations
Schedule time to follow up on employee’s progress

64. Coaching Conversations Tips
Create the right setting
Respect the employee’s need for privacy
Give your full attention to the employee - don’t allow interruptions, turn off phones, beepers
Focus on specific behavior/ performance gaps, not the person
Don’t use general or judgmental language. The comment “you’re too lazy” is much more likely to arouse defensiveness than the comment “you’ve missed two deadlines”.
Focus on the one or two critical performance gaps. Don’t overwhelm the employee by trying to tackle too many development action items at one time.
Keep your emotions in control
Remember you need to be in charge of the meeting. If you become angry or upset, you have lost control of the meeting and won’t be effective in getting your message across
Take a time-out if needed
If the employee becomes angry or upset, take a break for a few minutes. The employee won’t be listening to you if the employee is emotionally out of control.

65. Coaching Conversations Tips
Utilize self feedback
Ask the employee to comment on his/her evaluation of the behavior and performance gaps. Engage the employee in dialogue and avoid the tendency to lecture.
LISTEN, LISTEN, LISTEN!
Address performance problems honestly and directly
Don’t “sandwich” the tough feedback with positives - the message may get lost.
State your expectations of how the employee’s performance must change
Focus the conversation on the future - don’t continue to rehash past mistakes
Develop timeline for actions identified to correct performance
Solicit ideas and offer recommendations on how to improve performance
Ensure that employee has a very clear picture of what successful performance looks like
Identify clearly what positive outcome will result from the desired change in behavior
Ensure that the employee understands that the responsibility for correcting performance gaps is in his/her hands, not yours.
Ensure understanding by asking the employee to summarize what he/she heard in the meeting and what specific actions he/she will take to correct the performance problem

66. Tracking Employee Progress
Schedule regular check-in meetings with the employee to review progress (Review the Communication of Development Plan Agenda)
Review and revise the development action plan as required (Is the plan producing the desired expected behavior changes/results?)
Don’t wait for a scheduled check-in meeting to give feedback, especially if the employee is going off-track. Provide on-going feedback on how the employee is progressing
Document conversations and employee’s progress
Involve HR if employee’s progress is not meeting expectations

67. Resources

68. Manager’s Checklist
Have I clearly communicated my expectations to the employee?
Do I give timely feedback?
Have I provided the resources needed for the employee to meet the expectations?
Have I worked with the employee to eliminate barriers to their success?
What additional information is available about the employee’s past performance? How recent is it? How consistent is it over time?
What are the employee’s strengths and how can they be leveraged to impact or compensate for the developmental areas?

69. Manager’s Checklist Cont.
Have I evaluated my own biases and perceptions to ensure I am providing fair, honest feedback?
Have I utilized someone outside my team as a sounding board to get a different perspective on my evaluation of the employee’s performance?
Have I demonstrated my commitment to the employee’s success?
Am I demonstrating the behaviors I expect from the employee?

70. Available Resources EOP Training Session Toolkit eAdvisor
Coaching Skills Workshop
Oxy E&OD Web Site Coaching Tools
Oxy Learning Library HR
E&OD Team