Performance Management

Dr. Jacob Mathew Pulikotil

Professor & HoD
Naipunnya Institute of Management and
Information Technology
Module I:
Concepts of organizational performance:
Vision and mission: Communicating and living
shared view; competencies and behaviors for
effective performance; Establishing the skills,
knowledge and attitude required for the
organizations future; Recruiting and
developing against the agreed competencies;
Performance standards and targets; Clarifying,
communicating and reviewing organizational
goals and targets; Linking group and individual
responsibilities to organizational performance.
Performance management -
Definition
The development of individuals with
competence and commitment, working towards
the achievement of shared meaningful
objectives within an organisation which supports
and encourages their achievement Lockett
Performance management is a strategic and
integrated approach to delivering sustained
success to organizations by improving the
performance of the people who work in them and
by developing the capabilities of teams and
individual contributors - Armstrong and
Baron
 Aims of Performance
Management
The overall aim of performance
management is to establish a high
performance culture in which individuals
and teams take responsibility for the
continuous improvement.
Its key purpose is to focus people on doing
the right things by achieving goal clarity.
Performance management is about aligning
individual objectives to organizational
objectives and ensuring that individuals
uphold corporate core values.
The following are the aims of performance
management as expressed by a variety of
organizations:
Focusing employees tasks on the right things
and doing them right. Aligning everyones
individual goals to the goals of the organization
(Eli Lilly & Co).
Proactively managing and resourcing
performance against agreed accountabilities and
objectives (ICI Paints).
The process and behaviors by which managers
manage the performance of their people to deliver
a high-achieving organization (Standard Chartered
Bank).
 CHARACTERISTICS OF PERFORMANCE
MANAGEMENT
Performance management is a planned process in which
the primary elements are agreement, measurement,
feedback, positive reinforcement and dialogue.
It is concerned with measuring outputs in the shape
of delivered performance compared with
expectations expressed as objectives.
In this respect, it focuses on targets, standards and
performance measures or on the basis of
performance management indicators.
It is based on the agreement of role requirements,
objectives and performance improvement and
personal development plans.
It provides the setting for ongoing dialogues about
performance, which involves the joint and
continuing review of achievements against
objectives, requirements and plans.
 Organizational performance
The measures
key measures for organizational performance are :
Financial performance for example sales, profits,
return on capital, economic value, earnings per
share, price/earnings ratio.
Operational performance these measures will be
related to the critical success factors. For example, in
a retail store these could include level of service to
customers and customer satisfaction, stock
availability and stock wastage. A manufacturing
company might use measures of quality, inventory
control and delivery.
People performance output per employee
(productivity), retention rates, employee satisfaction.
PERFORMANCE MANAGEMENT ROAD MAP
Concepts of organizational
performance: Vision and
mission
The real concept of performance management is
associated with an approach to creating a shared
vision of the purpose and aims of the organisation,
helping each employee understand and recognize their
part in contributing to them
Vision: Dream or a picture to be achieved ultimately
Created by consensus.
Forms mental image of future to which people can
align.
Describes something possible, not necessarily
predictable.
Provides direction and focus.
Pulls people, who hold it, towards it.
Vision examples
"Our [Amazon's] vision is to be earth's most customer
centric company; to build a place where people can
come to find and discover anything they might want
to buy online." (Quoted fromAmazon.com)
"PepsiCo's responsibility is to continually improve all
aspects of the world in which we operate -
environment, social, economic - creating a better
tomorrow than today.Our vision is put into action
through programs and a focus on environmental
stewardship, activities to benefit society, and a
commitment to build shareholder value by making
PepsiCo a truly sustainable company." (Quoted
fromPepsico.com.)
 Mission
Mission is the overall purpose of the organization,
setting out clearly what it is there to do and achieve.
For example, a software company might describe its mission as
follows: We are a company dedicated to the development and
application of information technology to provide high-value
customer solutions that will achieve operational and
managerial effectiveness.
Focus attention on purpose what the organization
exists to do
Convey top managements vision about the
organization;
Provide a foundation upon which critical success factors
can be determined and strategic plans can be built;
Lead to the development of explicit statements defining
the core values of the organization;
Act as levers for change indicating the starting points
for programmes for development, innovation and
performance improvement.
 Mission examples
We seek to be Earths most customer-centric
company for four primary customer sets:
consumers, sellers, enterprises, and content
creators (Quoted fromAmazon.com)
Our mission is to be the world's premier
consumer products company focused on
convenient foods and beverages. We seek to
produce financial rewards to investors as we
provide opportunities for growth and enrichment
to our employees, our business partners and the
communities in which we operate. And in
everything we do, we strive for honesty, fairness
and integrity.(Quoted fromPepsico.com.)
 Mission and Vision
Mission and vision both relate to an organizations
purpose and are typically communicated in some written
form.
Mission and vision are statements from the organization
that answer questions about who we are, what do we
value, and where were going.
A study by the consulting firm Bain and Company reports
that 90% of the 500 firms surveyed issue some form of
mission and vision statements.
Moreover, firms with clearly communicated, widely
understood, and collectively shared mission and vision
have been shown to perform better than those without
them. The reason could be that strategy, goals and
objectives were aligned with them as well.
Finally, the mission statement lays out the organizations
purpose for being, and the vision statement, based
on that purpose, this is what we want to become.
 Importance of
communicating Vision &
Mission
Mission and vision statements play three critical roles:
Communicate the purpose of the organization to
stakeholders
Inform strategy development
Develop the measurable goals and objectives by which to
gauge the success of the organizations strategy.
Vision and mission statements are widely circulated and
discussed through workshops and meetings, so that their
meaning is widely understood, shared, and internalized.
The better the stakeholders understand an organizations
purpose, through its mission and vision, the better they
will be able to understand the strategy and its
implementation.
Vision statements also provide a bridge between the
mission and the strategy
Gary Hamel and C. K. Prahalad describe the
relationship between vision, mission and
strategy as stretch for achieving organizational
objectives.
Study of organizations like CNN, British
Airways, and Sony, found that firms which
focused on vision and mission displaced
competitors with stronger reputations and
deeper pockets through more innovative ways.
Together, mission and vision guide strategy
development, help communicate the
organizations purpose to stakeholders, and
inform the goals and objectives set to
determine whether the strategy is on track.
 Value statements
The purpose of a value statement is to help develop a
value-driven and committed organization that
conducts its business successfully by reference to
shared beliefs and an understanding of what is best
for the enterprise. Values for a software company:
People: Our people are the source of our
strength. They provide innovation and intelligence
and determine our reputation and vitality.
Products: Our products are the end result of
our efforts. They serve our customers best.
Customers: We depend absolutely on our
customers. We have to identify their needs and
satisfy them.
Profits: The ultimate measure of our efficiency.
Profits are required for us to survive and grow.
 Goals
An observable and measurable end result having one
or more objectives to be achieved within a more or
less fixed timeframe.
Goals guide employee efforts and motivates to
perform
Goals justify a company's activities and existence
Goals define performance standards
There are two main types of organizational goals:
official and operative.
Official goals detail a company's aims as described in
their vision statements, corporate charter and annual
reports. They help to build the organization's public
image and reputation.
Operative goals are the actual, concrete steps a
business intends to take to achieve its purpose.
 Objectives
A specific result that a person or an
organization aims to achieve within a time
frame and with available resources.
Objectives are more specific and easier to
measure than goals.
Objectives are basic tools that underlie all
planning and strategic activities.
They serve as the basis for creating policy
and evaluating performance.
 Goals vs. Objectives

Goals Objectives
General Specific
Intangible Measurable
Broad Narrow
Abstract Concrete
Strategiclong-range Tacticalshort-
direction, set by senior range, set by
management managers to support
the accomplishment
of goals
 Goal Vs Objective example
Goal: To double the number of people using your web-
conferencing service.
Objectives may be as follows:
Gain awareness by placing print ads in four regional
markets and by airing radio ads in two major markets
(by June 10)
Attract first-time customers by offering an online
giveaway of $1,000 (by June 1)
Cultivate prospects by implementing a permission-based
weekly e-mail to 2,500 targeted contacts (by July 10)
Convert 10 percent of prospects to clients, using e-mail
reminders (beginning July 25)
 Critical success factors
Critical success factors indicate those areas of corporate
performance that are vital to the successful
accomplishment of the organizations mission.
CSFs describe the key issues to which attention must be
given if the organization is to thrive and grow. Thus they
could be described as the drivers of organizational
performance.
The following is an example of the critical success factors
drawn up for a small but growing pharmaceutical
company:
Product development
Market development
Process innovation
Customer service
Human resources
Asset utilization
 Key Performance
Indicator
Akey performance indicator(KPI) is a business
metric used to evaluate factors that are crucial to the
success of an organization.
KPIs help managers and employees gauge the
effectiveness of various functions and processes
important to achieving organizational goals.
KPIs are intrinsically linked to a firm's strategicgoals
and are used to help managers assess whether they
are on or off target as they work towards those goals.
For e.g.: A marketing group will look at the
contribution of marketing generated sales leads to
total revenue over time to gauge their effectiveness.
Human resources will look at employee engagement,
employee turnover, time-to-fill open positions and
other related metrics.
 Key Performance Indicators
(KPI)
KPIs measure how well companies, business units,
projects or individuals are performing compared to
their strategic goals and objectives.
Well-designed KPIs provide the vital navigation
instruments that give clear understanding of current
levels of performance.
KPIs are closely tied to strategic objectives and help
to answer the most critical business questions.
Key Performance Indicators are used in four main
areas:
Revenue improvement
Cost reduction
Process cycle-time improvement
Increased customer satisfaction
 Qualities of a good KPI
KPIs reflect Strategic Value Drivers: that which when
executed properly guarantee future success.
KPIs should cascade throughout an organization: as
goals, plans for the group.
KPIs are based on corporate standards: They work only
in presence of standardized measurements.
Available and Measurable: use only those metrics as KPIs
which are available and can be measured.
Contribute to the overall target: If a metric does not
greatly impact the business bottom-line then it is not a good
KPI.
Relevant: Should be relevant to the business objectives.
Instantly useful: Should be able to quickly take actions
Timely: Should be available in a timely manner for taking
timely decisions.
Empowers users
KPI story
KPIs & CSFs
 Difference between CSF &
KPI
Example 1: A restaurant: To increase profit in the operating year 2016-17

CSF KPI
Market share % of market
Customer satisfaction % of customers who are satisfied
Meal quality % of meals returned because of poor quality
Example 2: Whitegoods manufacturer: To increase the operating profit .

High product quality Number of warranty claims

High process yields % rolled out

Low production costs Average production costs (Rs)

Market Share % of the market
 Metrics
Standards of measurement by which efficiency,
performance, progress, or quality of a plan, process,
or product or organization can be assessed.
Performance metricsmeasure an organization's
activities and performance.
It should support a range of stakeholder needs from
customers, shareholders to employees.
Developing performance metrics usually follows a
process of:
Establishing critical processes/customer requirements
Identifying specific, quantifiable outputs of work
Establishingtargetsagainst which results can be
scored
 Competencies and Behaviors
Competency is defined as the quality of being able to
perform or aqualitythatpermits or facilitates
achievement or accomplishment.
The term "competence" first appeared in an article
authored by R.W. White in 1959 as a concept for
performance motivation. T.F. Gilbert (1978) asserted that
competency is related to performance improvement.
A competency is a set of defined behaviors that provide a
structured guide enabling the identification, evaluation
and development of the behaviors in individual employees
Some scholars see "competence" as a combination of
practical and theoreticalknowledge, cognitive skills,
behavior and values used to improve performance or
having theabilityto perform a specificrole. Some of the
examples are decision making, information gathering and
wider thinking.
 Types of competencies
Core Competencies Core competencies are
those competencies that any successful employee
will need to rise through the organization.
Key Competencies Key competencies
contribute to valued outcomes of the
organization, defining the abilities of individuals
to meet strategic demands, and are important not
just for specialists but for all individuals.
Critical Competencies Critical competencies
are competencies without which the organization
will be unable to achieve its goals and strategy.
 Types of competencies
Behavioral (or Life Skills) Competencies: are
problem solving behaviors used appropriately and
responsibly in the management of personal affairs.
Examples are: Communication, Analytical Ability,
Problem Solving, Initiative, etc.
Functional (or Technical) Competencies: relate to
functions, processes, and roles within the
organization. Examples are: Application Systems
Development, Networking and Communication,
Database Analysis and Design, etc.
Professional Competencies: used in organizational
context are accelerators of performance. These if
lacking in sufficient strength and quality are the
reason for people fail or excel in jobs. Examples are:
Business Environment, Industry and Professional
Types of competencies in modern
businesses
Daniel Katz (1955) has classified competencies into
the following areas:
Technical or Functional CompetenciesThese
are the knowledge, attitude, and skills-related to
technical or functional expertise required to perform
a role.
Managerial CompetenciesThese are the
knowledge, attitude, and skills required to plan,
organize, mobilize, and utilize resources.
Human CompetenciesThese are the knowledge,
attitude, and skills required to motivate, utilize, and
develop human resources.
Conceptual CompetenciesThese are the
knowledge, attitude, and skills to visualize the
invisible, i.e., the thinking at abstract levels and use
of the thinking to plan future business.
Behavioral competencies for
PM
Personal drive demonstrate the drive to achieve,
acting confidently with decisiveness and resilience.
Business awareness identify and explore
business opportunities, understand the business
concerns and priorities of the organization and
constantly seek methods of ensuring that the
organization becomes more businesslike.
Teamwork work cooperatively and flexibly with
other members of the team with a full
understanding of the role to be played as a team
member.
Communication communicate clearly and
persuasively, orally or in writing.
 Customer focus exercise unceasing care in looking after
the interests of external and internal customers to ensure that
their wants, needs and expectations are met or exceeded.
Developing others foster the development of members of
his or her team, providing feedback, support, encouragement
and coaching.
Flexibility adapt to and work effectively in different
situations and carry out a variety of tasks.
Leadership guide, encourage and motivate individuals and
teams to achieve a desired result.
Planning decide on courses of action, ensuring that the
resources required to implement the action will be available
and scheduling the programme of work required to achieve a
defined end-result.
Problem solving analyze situations, diagnose problems,
identify the key issues, establish and evaluate alternative
courses of action and produce a logical, practical and
acceptable solutions.
 Competency based
recruitment
A Competency-Based Approach to Recruitment
and Selectioncovers:
1. Planning and preparing for recruitment and selection
which covers analyzing positions and drafting
required competencies and specifications for
different roles.
2. Drawing up competency-based interviewing guides
which includes appropriate questions and rating
scales.
3. Initial screening and short listing techniques.
4. Conducting competency-based interviews, recording
responses and rating competencies.
5. Conducting references, and various checks.
6. Making offers and declining unsuccessful candidates.
 Competency based
interviewing
Competency based interviewing is a behavioral-based
interviewing process designed to provide employers
with specific data that allows them to predict future
job related behaviors.
Through this process, employers collect information
based on knowledge, motivation and behavior of
employees needed to perform a job successfully and
at the same time determine if the applicant is the
right fit for the company or division based on
previous experiences.
Behavioral-type questions will therefore need to be
included in the interview process. These questions will
evolve around personal experiences of the applicant
and practical work related questions designed around
specific and pre-determined Competencies.
 Competencies assessed during
selectionUnderlying
Motives: process need or thought pattern
that drives, directs and selects an individuals
behavior. E.g. need for achievement.
Trait: A general disposition to behavior responds
in a certain way, for instance with self-confidence,
self-control, stress resistance.
Self-concept: What they think they value, what
they think they do or interested in doing.
Knowledge: Content knowledge
Cognitive skills: include retrieving information
from memory, using logic to solve problems,
communicating, focusing attention.
Behavioral skills include negotiation, training,
motivational decision making, and planning
Specific Competencies for employees
Building Trust:
HONEST: Behaves and expresses oneself in an open and
honest manner. Is consistent in word and actions. Tells the
truth even when it is difficult. Shares information accurately,
completely and appropriately.
COMMITED: Follows through on assignments and
commitments. Supports Emory goals and initiatives. Adheres
to all policies and procedures.
Collaboration:
RESPECT: Treats all people with dignity, respect and
fairness. Resolves interpersonal conflicts constructively.
Shares time, energy and knowledge with others to ensure
they can succeed.
INCLUSIVENESS: Demonstrates awareness and respect of
cultural and individual values. Listens to ideas from others,
even when different from own. Is careful to ensure all sides
are heard before reaching a conclusion.
Communication:
LISTENS AND SHARES: Provides regular, consistent,
and meaningful information. Listens carefully to others
and ensures message is understood. Ensures important
matters are shared with all appropriate parties.
CLARITY: Communicates in a clear and concise
manner. Demonstrates professionalism through body
language, including eye-contact and posture. Tailors
communication style to needs of the recipient.
Delivering Results
Delivering Results:
PRODUCTIVITY: Strives to consistently achieve
excellence in all tasks and goals. Maintains focus and
perseveres in the face of obstacles. Uses time
efficiently. Prioritizes tasks based on importance.
PERSONAL GROWTH: Ensures job knowledge and
skills are current and valuable. Receptive to feedback.
 Competency definition behavior and
rating
Definition
E.g.: Building Rating Scales
Trust
Unacceptab Met Far exceeds
le expectatio expectation
(1) ns (3) s (5)
Building Trust Does not Behaves and Behaves and
HONEST: behave or expresses expresses
Behaves and express oneself oneself in an oneself in an
expresses in an open or open and open and
oneself in an honest manner. honest honest manner;
open and honest manner. is consistent in
manner. all cases with
Is consistent in what he/she
word and says and does;
actions. Appropriately
Tells the truth handles difficult
even when it is situations.
difficult.
Shares
 Advantages of competency
based recruitment
Reduces risk: Competency based recruitment reduce
the risk of making a costly hiring mistake and increase
the likelihood of identifying and selecting the right
person for the right job.
Sets Clear Expectations: Provides employees with
clear direction on how they can contribute. Reinforces
behaviors that are consistent with the organizations
mission, culture and priorities.
Identifies Training and Development Actions:
Provides employees with a roadmap for building
strengths and closing development gaps. Ties to career
growth and becoming a learning organization.
Integrates HR Programs: Improves consistency in
recruiting and selection, training, performance
management and workforce/succession planning.
Streamlines and simplifies HR operations.
 Advantages of competency
based for development
Recruitment and Selection: Knowing requisite
competencies can help interviewers in assessment and
HR managers in communicating career opportunities
both lateral and vertical moves.
Behavioral expectations: Competencies set clear
guidelines on expected behaviors for the post.
Career development: Competencies can help define
expectations at each level of management, which
supports clear and transparent promotion guidelines.
Compensation: can help in developing job
performance criteria and can be linked to better
compensation management
Training: Helps in identifying training needs and
evaluations
 Attitude, Skills, and
Knowledge
Attitude: A predisposition or a tendency to respond
positively or negatively towards a certain
idea,object,person, or situation.
Four majorcomponentsof attitude are (1) Affective:
emotions or feelings. (2)Cognitive: belief
oropinionsheldconsciously. (3) Conative: inclination for
action. (4) Evaluative: positive or negative response to
stimuli.
Skill: Anabilityandcapacityacquired through deliberate
systematic, and sustained effort to smoothly and
adaptively carry out complex activities or job functions
involving ideas (cognitiveskills), things (technical skills),
and/or people (interpersonal skills).
Knowledge: In anorganizationalcontext, knowledge is
thesumof what is known andresidesin the intelligence
and thecompetenceof people. In recent years, knowledge
has come to be recognized as afactorofproduction.
 ASK model
The ingredients of ASK came from Vinkes (2002)
definition of competency as the ability of an individual
to select and use the knowledge, skills, and attitudes
that are necessary for effective behavior in a specific
professional, social or learning situation.
Attitude: Attitude could be divided into two groups:
personal and professional. Professional attitudes include:
Ability to gather appropriate information, knowledge
Tackle problems.
Dedication and motivation
Team work and the ability to run the task smoothly
Time management
Responsibility of the out comes
Acquire experiences.
Negotiate with clients and team member(s)
 Skills
American Management Association has
identified important skills i.e. conceptual
skills, communication skills, effectiveness,
and interpersonal skills. Other skills required
include communication skill, computer skills,
analytical skills,leadership skills, problem
solving skills, time management skills,
mathematical skills, and professional skills.
Research by Robert L. Katz found that
managers needed three important skills.
These are technical, human and conceptual.
Knowledge
Knowledge comprises of several kinds:
Descriptive Knowledge: for role and
performance.
Normative Knowledge: for fulfilling duties
and achieving goals.
Operational Knowledge: for making
strategies and evaluation.
Tacit Knowledge: rooted from experiences.
Explicit Knowledge: Academic knowledge
which transferred from one knower to another.
 ASK for organizations future
- Reasons
Shift of economy from global to
manufacturing and on to services.
Information and knowledge-based
organizations are now creating the bulk of
the wealth in the economy. Examples are in
professional services such as consulting,
law, investment banking, and in technology.
Organizational require people with
individual skills, attitudes and knowledge-
sharing which are the key contributors to
achieving organizational objectives.
 Performance standards
A performance standard is a management-approved expression of
the performance threshold(s), requirement(s), or expectation(s) that
must be met to be appraised at a particular level of performance.
A performance standard includes an employee performance plan
which encourages the employee to meet standards higher and be
successful.
Performance standards should be objective, measurable, realistic,
and stated clearly in writing (or otherwise recorded). The standards
should be written in terms of specific measurers that will be used to
appraise performance.
Performance standards tell employees, as to how well they have to
do their work.
Akeyperformanceindicator (KPI) sets a performancestandardfor
anorganization, a business unit, or an employee.
 Developing Performance
Standards
Quality: Address how well the work is performed
and/or how accurate or how effective the final
product is. Quality also refers to accuracy,
appearance, usefulness, or effectiveness.
Challenging: Performance standard should be high
enough to be challenging but not so high that it is
not really achievable.
Cost-Effectiveness addresses savings to the
organization Cost-effectiveness standards may
include such aspects of performance as maintaining
or reducing unit costs, reducing the time it takes to
produce a product or service, or reducing waste.
 Performance Targets
Performance targets are specific goals for the
organization to achieve by a specific date and are
essential to performance management.
No leadership team, in any organization: private,
nonprofit, or public undertaking can perform without
establishing such explicit targets.
A performance target provides an unambiguous
definition of success. It signals what is important. It tells
people what is expected. It focuses everyones
attention.
Goalsetting means establishing what a person or an
organization wants to achieve. Goals should be specific,
measurable, achievable, realistic, and time-targeted
(SMART).
The target(s) set by health authorities within their
performance improvement plan. E.g. Achieve 80%
Targets Essentials
Unambiguous: Targets should be clear, brief,
attainable, and measurable, and can be
expressed in terms of:
Quality - how well work must be done in terms
of accuracy, appearance, completeness,
thoroughness, precision, and compliance with
professional standards which may have been
established for an occupation
Quantity - how much work must be completed
within a given time period.
Timeliness - when, how soon, within what time
period work must be done
 Target essentials
Effective use of Resources - assess the
cost/benefits or use of resources such as
money, equipment, personnel, time
Manner of Performance - describes specific
behaviors that have an impact on outcomes
such as cooperation and courtesy (sometimes
inappropriately referred to as "attitude")
Method of Performing - used if there are
rules regarding the methods and procedures
which must be used to accomplish
assignments work.
 Developing Goals/Targets
Goals should be set not only to address what is
expected, but also how it will be achieved.
For example, the "what" covers quality or quantity
expected, deadlines to be met, cost to deliver, etc.
The "how" refers to the behavior demonstrated to
achieve outcomes, for example, focus on customer
service.
In addition, some organizations choose to include
competencies within performance expectations, to
reinforce the link to business strategy, vision and
mission.
An accepted framework to use to help write effective
goals is the "SMART" goal: S Specific, M
Measurable, A Ambitious/Achievable/Attainable,
R Result oriented/Realistic/Relevant, T - Time
bound
 Translation of vision to organizational unit
goals.Once the vision, mission, strategy, and broad
organizational goals are set, they are used to identify
appropriately aligned goals for lower-level organizational,
functional, departmental, and/or work team units.
Joint establishment of individual goals.Supervisors
and employees agree on a specific set of goals and
objectives for the individual to accomplish over a specific
period of time.
Ongoing coaching and feedback.The individual is
supported, guided and tracked during the specified
performance period on her individual goals, receiving
feedback, coaching and periodic assessments from the
supervisor.
Evaluation of performance.The individuals
performance is formally assessed relative to the goals
established with the supervisor at the beginning of the
performance period.
Targets can be defined with
SMARTS model:
Specific: with enough detail to be clear
Measurable: use quantitative goals when
available, use milestones, use thoughtful
judgments
Attainable: realistic in terms of employee's
control, timeframe, and resources available
Reasonable: realistic in terms of what can
really be achieved
Time-based: with dates set for achieving
milestones, results, completion
Stretch: challenging to achieve beyond the
current levels, "raise the bar
 Communicating Goals
Goals should be clear: Clear organizational goals can
drive employee efforts throughout the organization and
energize employees towards their achievement. But if
employees do not know what the organization's goals
are, they loose the ability to perform and perform with
mediocrity. Thus communicating organizational goals to
employees is essential for achieving desired outcomes.
Goals should be understood by all: Employees
need to understand organizational policies and
procedures so that they can work efficiently and
effectively. They need to understand the company's
products and services so they can communicate about
them to the customers.
Check for effectiveness: It is also required that to
know whether the communication is effective. Hence
companies should measure employee knowledge,
awareness and perception.
 Use the ideal mode :Companies can communicate with
employees, ranging from face-to-face to online. Technology
has added multiple options to the mix. Companies should
identify all of the various options available to them and
then, based on the type of communication, decide which
communication tools--or combination of communication
tools should be used to communicate.
Provide opportunity for feedback: Employee
communication should also provide opportunities for
employees to share feedback with their supervisors and
managers, and company leaders. This will set the stage for
strong, trusting relationships between the organization and
its employees.
More over honest and open communication from
employees and management can help build trust and
loyalty.
Goals are also a contract: between the individual and
the organization. They should be viewed as a route towards
a destination. Should the destination change with a change
in business direction or requirements, consider revising
goals.
 DEVELOPING A
PERFORMANCE
DEVELOPMENT PLAN
PDP is considered a process, not an event.
Continualcoaching, feedback and communication are
integral to success.
PDP is primarily a communication tool to ensure
mutual understanding of work responsibilities,
priorities and performance expectations.
Performance standardsfor each major
duty/responsibility should be defined and
communicated.
Professional developmentshould be an important
component of the career plan.
Evaluation period should be sufficient - long enough
to allow for full performance.
Trainingfor supervisors and employees should be
encouraged.
 Clarifying Organization
goals
Clarifying performance expectations is usually done
when :
The organization has announced a change in
direction of its vision, or needs to align its effort to
meet important goals.
A new performance cycle has begun.
The person is new to the organization, work group,
team, role, or assignment.
The person has been asked to clarify priorities
and/or goals.
The person is exceeding expectations and needs
new challenges.
Reviewing organizational
performance
An organizational review is a systematic process for
obtaining valid information about the performance of an
organization and the factors that affect performance.
It differs from other types of evaluations because the
assessment focuses on the organization as the primary
unit of analysis.
Organizations reviews are conducted to better
understand what they can or should change to improve
their ability to adapt, survive, perform and influence.
One of the most comprehensive frameworks for
reviewing Organizational Performance is the
Institutional and Organizational Assessment
Model (IOA Model)
IOA model
This model views the performance of an organization as a
multidimensional idea, that is, as the balance between
the effectiveness, relevance, efficiency, and financial
viability of the organization.
A literature review conducted for developing the
framework showed that organizations change: in
response to factors in their external environment,
changes in their internal resources (e.g., financial,
technological, human), and as a result of fundamental
shifts in values within the organization, which in turn
affect the organizational climate, culture and ways of
operating.
The framework also posits that organizational
performance should be examined in relation to the
organization's motivation, capacity and external
environment.
Linking employees with
organizational goals
Organizations that focus on harnessing individual
potential are likely to be more competitive than their
peers.
The best way to ensure individual employees efforts
have maximum impact on the bottom line is to link
them to organizational goals.
Connections should be made deliberately, and the
process can be designed in a way that virtually
guarantees business success.
Once a department establishes its goals, the activities
necessary to complete associated responsibilities are
assigned to individual team members.
These individuals are then free to establish their goals
within the context of the organizations strategic
objectives.
 The collective efforts of individuals and departments
creates organizational success.
The linking process starts at the top and moves down the
organizational structure to the individual.
Individual goals and activities are then reported back up
the organizational structure.
The reporting structure gives executives a method to
track and monitor the execution of business plans.
Organization-centric goals describe how to link to goals
from the top of the organization down to the lowest level,
like a staircase.
In this model, everyones efforts are harnessed and
directed towards the most important organizational
outcomes.
If individual goals are made in isolation, tremendous
effort might be spent doing work that is not most
important or most pressing. This is why organization-
centric goals are indispensable.
Module II
Performance management: Meaning and
importance of Managerial Performance;
Critical success factors analysis for
managerial performance; Business System
analysis; Management styles and
performance; Style of communication;
Performance appraisal: Instrument for
performance appraisal; Evaluation of
managerial performance. Setting
performance standards; measurement of
performance; Time management;
Importance of Managerial Performance
Performance management can be regarded as a
systematic process by which the overall
performance of an organization can be improved
by improving the performance of individuals within a
team framework.
PM is a means for promoting superior performance
by communicating expectations, defining roles
within a required competence framework and
establishing achievable benchmarks.
According to Armstrong and Baron (1998), Performance
Management is both a strategic and an integrated
approach to delivering successful results in
organizations by improving the performance and
developing the capabilities of teams and individuals.
Performance management is an ongoing
communication process which is carried between the
supervisors and the employees through out the year.
A performance management system includes the following
actions.
Developing clear job descriptions and employee
performance plans which includes the key result areas
(KRAs) and performance indicators.
Selection of right set of people by implementing an
appropriate selection process.
Measuring the outcome and overall productivity against
the predefined benchmarks.
Providing continuous coaching and feedback during the
period of delivery of performance.
Identifying the training and development needs
Holding quarterly performance development
discussions and evaluating employee performance on the
basis of performance plans.
Designing effective compensation and reward systems
for recognizing those employees who exceed the performance
benchmarks.
Providing promotional/career development support and
guidance to the employees.
Performing exit interviews for understanding the cause of
employee discontentment and thereafter exit from an
organization.
Activities in PM
Communicating the vision to all employees
Translating the vision to mission
Converting mission to overall objectives of the
organization
Setting departmental and individual performance
targets
Developing the formal appraisal procedure
Linking performance to pay (Wherever essential)
Conducting performance appraisal to review or
track progress
Using review to indentify training and development
Evaluating the performance holistically to improve
organizational effectiveness
 Role of managers in PM
Performance improvement(i.e. supporting
individual, team and organisational effectiveness)
Development(i.e. supporting the continuous
development of individuals and teams resulting in
continuous performance improvement)
Managing behavior(i.e. ensuring that people are
supported and encouraged to adopt behaviors that
promote better working relationships)
Synergy: To create synergy and team work
Problem identification and solution: To identify
and solve problems of employees
Measuring performance: To assess and measure the
actual performance of employees
Organizational and environment problem
identifcation: To identify and improve internal and
external factors affecting performance of employees
Motivation: To motivate and support employees
Create a culture of continuous learning:
Sharing knowledge and provide employees with
learning experiences relevant to success in their
role.
Building trust : Must constantly strive to build
trust and remove barriers to enable employees to
grow - and to promote continuous organizational
improvement.
Foster dialogue about talents and strengths:
Foster dialogue with employees' talents and
strengths, areas where they may need additional
support or training, and how the gap between
talent and training could be bridged.
Encourage mentoring: Mentoring employees
for positive developmental growth.
 Critical success factors for
managers
Managing and developing people Orient employees
towards direction and structure of the organization
and help them to develop their skills and knowledge.
Maintain strategic focus To keep focused on the
desired end results and align all the Success Factors
for optimum performance.
Effective operation management: Effective
operation to ensure that customers get what they
want through a high flow of information through all
directions.
Utilize resources optimally to sustain the
organization
Management styles
The Managerial Grid is based on two behavioral
dimensions:
Concern for People This is the degree to
which a leader considers the needs of team
members, their interests, and areas of personal
development when deciding how best to
accomplish a task.
Concern for Results This is the degree to
which a leader emphasizes concrete objectives,
organizational efficiency and high productivity
when deciding how best to accomplish a task.
 Impoverished Management Low Results/Low People
This leader is mostly ineffective. He/she has neither a high
regard for creating systems for getting the job done, nor for
creating a work environment that is satisfying and motivating.
The result is disorganization, dissatisfaction and disharmony.
Country Club Management High People/Low Results
This style of leader is most concerned about the needs and
feelings of members of his/her team. These people operate
under the assumption that as long as team members are
happy and secure then they will work hard. What tends to
result is a work environment that is very relaxed and fun but
where production suffers due to lack of direction and control.
Authority-Compliance Management High Results/Low
People
Also known as Authoritarian or "Produce or Perish" Leaders,
people in this category believe that employees are simply a
means to an end. Employee needs are always secondary to
the need for efficient and productive workplaces. This type of
leader is very autocratic, has strict work rules, policies, and
procedures, and views punishment as the most effective
means to motivate employees.
Middle-of-the-Road Management Medium
Results/Medium People
This style seems to be a balance of the two
competing concerns, and it may at first appear to be
an ideal compromise. Therein lies the problem,
though: When you compromise, you necessarily give
away a bit of each concern, so that neither
production nor people needs are fully met. Leaders
who use this style settle for average performance
and often believe that this is the most anyone can
expect.
Team Leadership High Production/High People
According to the Blake Mouton model, this is the best
managerial style. These leaders stress production
needs and the needs of the people equally highly.
 Management styles and
performance
Management Styles : Management style can be
understood as a way to manage an organization. According
to Schleh (1977), management style is the adhesive that
binds diverse operations and functions together. It is the
philosophy or set of principles by which the manager
capitalizes on the abilities of the workforce. Management
style is not a procedure on how to do but it is the
management framework for doing.
A management style is a way of life operating throughout
the enterprise and permits an executive to rely on the
initiative of the personnel of an entity.
Management styles are one of the important factors that
affect organizational effectiveness. A good match between
the style of management and operating realities of an
organization will substantially influence its level of
effectiveness. In each organization, management style
influences the performance of individual employee and
work groups, and thereby the whole organizations
performance.
Types of Management
styles
Likert (1967) classified four approaches of
management that constitute a continuum of
participative, paternalistic, exploitative and
autocratic, and consultative management style
Minzberg (1973) considered entrepreneurial and
strategic planning as forms of management styles
adopted by managers in organizational entities.
Blanchard (1994) reduced management styles to four
basic types. They are directing, supporting, coaching
and delegating.
Khandwalla (1995b) articulated ten dimensions of
management styles such as conservative,
participative, bureaucratic, paternalistic,
authoritarian, organic, entrepreneurial, visionary,
professional and altruistic.
Participative: Participative (or participatory)
management, otherwise known as employee involvement
or participative decision making, encourages the
involvement of stakeholders at all levels of an
organization in the analysis of problems, development of
strategies, and implementation of solutions. Employees
are invited to share in the decision-making.
Paternalistic: Paternalistic managers give more
attention to the social needs and views of their workers.
Managers are interested in how happy workers feel and in
many ways they act as a father figure (pater means father
in Latin). They consult employees over issues and listen to
their feedback or opinions. The manager will however
make the actual decisions (in the best interests of the
workers) as they believe the staff still need direction and
in this way it is still somewhat of an autocratic approach.
 Exploitative: In this system, managers tend to use
threats, fear, and punishment to motivate their workers.
Managers at the top of the hierarchy make all of the
decisions and are usually unaware of the problems faced
by those in the lower levels of the organization. Decisions
are imposed on subordinates, and motivation is
characterized by threats. As a result, workers tend to be
hostile toward organizational goals and may engage in
behavior that is counter to those goals.
Autocratic: An autocratic management style is one
where the manager makes decisions unilaterally, and
without much regard for subordinates. As a result,
decisions will reflect the opinions and personality of the
manager, which in turn can project an image of a
confident, well managed business. On the other hand,
strong and competent subordinates may chafe because
of limits on decision-making freedom, the organization
will get limited initiatives from those "on the front lines",
and turnover among the best subordinates will be higher.
Consultative: Consultative managers make
decisions more or less unilaterally. These leaders
prioritize communication with employees and
take their needs into account alongside the
needs of the business. Consultative
management allows the manager to make
decisions efficiently; in addition, the emphasis
on employee interaction tends to increase
employee loyalty and reduce turnover. However,
employees tend to become highly dependent on
their manager. Consultative managers tend to
be most successful in businesses that hope to
retain employees for long periods of time. Many
of the best office managers use this style.
Business system analysis
Business systems analysis (BSA): is an analytical
framework that involves gathering information
about business systems and subjecting that
information to formal analysis.
BSA is the act of identifying, defining and
examining in detail the component parts of a
business system, or organization, to gain insight
into how the organization functions and the
interrelationships between various tasks, jobs,
people, structures and other elements.
This includes identifying broad organisational
goals and supporting business areas and
processes.
Business systems are made up of a set of
interacting and interrelated processes that
function together to attain a common purpose.
Business systems requires a clearly defined
organizational mission statement and appropriate
related objectives.
Business analysis consists of three main tasks:
Identifying important goals for the appropriate
business unit
Clarifying that these are indeed appropriate goals
Determining how specific and measurable the
goals
Business process re-engineering (BPR) is the
fundamental rethinking and radical redesign of business
processes to achieve dramatic improvements in critical,
contemporary measures of performance, such as cost,
quality, service and speed.
BSA can be seen as a valuable tool for organizational
change, improved record keeping and, ultimately,
making the organization effective.
 BSA for performance
management
The Management Systems performance management system
model has seven components that must be effectively
designed, managed and linked:
1. Key Result Areas: (from theStrategic Plan) Areas of
performance essential to the organization's or the individual
position-holders success.
2. Objectives(from theStrategic Plan) - Broad statements of
what needs to be achieved in each Key Result Area.
3. Goals(from the Strategic Plan or individual performance plan)
- Specific, measurable, time-dated performance targets to
beachieved. Each Objective will have one or more Goals.
4. MeasurementMethods, procedures, and tools used to
assess performance (i.e., Profit measurement, Monetary
measurement,Non-Monetary measurement).
5. Progress ReviewInformation about how effectively the
organization, department, or individual is performing relative
to a goal.
6. Performance EvaluationSystematic evaluation at the end
of the planning period of performance against Goals by Key
ResultArea. Typically serves as the basis for future Goal
setting.
7. Rewards Positive reinforcers for performance against Goals.
 Style of communication
Organizational communication is a process by which
activities of an organization are collected and
coordinated to reach the goals of both individuals
and the team. It is a component of effective
management in a workplace environment.
Need for organizational communication:
Work is more complex and requires greater
coordination and interaction among workers
The pace of work is faster
Workers are more distributed
Knowledge and innovation are more critical to an
organizations competitive advantage
Communication technologies and networks are
changing and increasingly essential to an
organizations structure and strategy.
Communication levels:
Interpersonal communication:
Interpersonal communication involves interchanging
ideas with others using an assortment of methods,
such as words, gestures, voice tone, facial
expression and body posture. Interpersonal skills are
the lifeblood of organizations because effective
communication dictates operational efficiency and
facilitates teamwork. It underlies the efficiency of
key business functions such as managing, training,
selling and resolving conflicts within an organization.
Group level communication : occur in teams, units
and employee resource or interest groups (ERGs).
The focus on this level is information sharing, issue
discussion, task coordination, problem solving and
consensus building.
Organizational level communication
Inter-organizational level communication
Types of communication in organizations:
Vertical Communication: Vertical
communication occurs between hierarchically
positioned persons and can involve both
downward and upward communication flows.
Downward communication is more prevalent
than upward communication.
Downward communication means the flow
of information from superiors to subordinates
and it is a dominant channel in accordance with
formal communication networks. Downward
communication can be used to convey a vision,
to motivate subordinates, provide feedback on
subordinates performance, and assigning
tasks and conveying task-related information.
 Upward communication, flows from subordinates to
superiors. Upward communication is a channel to know
how work is processing, what problems and opportunities
subordinates see, what ideas subordinates have for
improving performance, what intelligence subordinates
gather about what clients and other organizations are doing
and what subordinates feel about the agency, their
superiors, and their jobs
Horizontal communication indicates the lateral exchange
of information, which flows in accordance with the
functional principle among people on the same level within
an organization.
Diagonal communication flows between people, which
are not on the same organizational level and are not in a
direct relationship in the organizational hierarchy. This type
of communication is rarely used usually in situations.
Diagonal communication is used, in labor unions to organize
direct meetings between employees and top management,
avoiding the first line and middle level managers.
Communication in an organization is as vital as the
blood of life. According to Philip Kotler, (2006),
communication is the means by which firms attempt
to inform, persuade and remind consumers directly
or indirectly about the products and brands that
they sell.
Communication plays a very important role in the
process of directing and controlling the people in the
organization. Effective communication between
superiors and subordinates in the organization is
essential for the success and growth of an
organization. Feedback is an integral part of business
communication.
For efficient communication, it is necessary that the
receiver understands the meaning of the message
and indicates it to the sender through some expected
reactions.
 Communication for PM
The concept of performance management
lies on the premise that communication plays
a important role in employee performance.
Creates ashared understanding of goals,
competencies, and other expectationsthat
are critical for success
Fosters anenvironment of continuous
feedback and professional development
Provides with an opportunity to assess the
employees own performance
Enable employees to provide greater
support to the goals of the organization.
 Performance appraisal
Performance appraisal is a review and discussion of
an employee's performance of assigned duties and
responsibilities. The appraisal is based on results
obtained by the employee in his/her job, not on the
employee's personality characteristics. The
appraisal measures skills and accomplishments
with reasonable accuracy and uniformity. It
provides a way to help identify areas for
performance enhancement and to help promote
professional growth.
According to Edwin Flippo, "Performance Appraisal
is the systematic, periodic and impartial rating of
an employee's excellence, in matters pertaining to
his present job and his potential for a better job."
 Purpose of Performance
Appraisal
The main purposes of employee assessment are as
follows :
Identify employees who are eligible for salary increase.
Generate data to take personnel decisions such as
promotion, transfer and lay-off or termination decision.
Determine the training and development needs of the
employees.
Validate the selection process.
To measure whether standards laid down has been
achieved by the employees or not.
Estimate the future requirement of work force.
Helps to recognize potential of promising employees.
Last but not the least, performance appraisal also helps
in motivating employees by providing feed back about
their level of performance.
 Appraisal Methods
Narratives
Essays Critical Incidents
Ranking Comparisons
Ranking Method Paired Comparisons
Checklists
Simple Weighted
Rating Scales
Graphic Rating Scales Behaviorally
Anchored Rating Scales (Bars)
Objective Measures
Goal setting Standards (MBO)
360-degree Feedback
 Performance appraisal
process
Following steps are involved in appraisal process:
1) The appraisal process begins with the establishment of
performance standards. These should have evolved out
of job analysis and the job description. These
performance standards should also be clear and
objective enough to be understood and measured.
2) Once performance standards are established, it is
necessary to communicate these expectations. It
should not be part of the employees job to guess what
is expected of them. It is necessary to take a feedback
to understand whether the information communicated
by the manager has been received and understood in
the way it was intended.
3) The Third step in a appraisal process is measurement
of performance. To determine what actual performance
is, it is necessary to acquire information . Four common
sources of information are frequently used by mangers
to measure actual performance: personal observation,
statistical reports, oral reports, and written reports.
4. The fourth step in the appraisal process is
the comparison of actual performance with
standards. The attempt in this step is to
note deviations between standard
performance and actual performance.
5. The final step in the appraisal is the
initiation of corrective action when
necessary. Corrective action can be of two
types; one is immediate and deals
predominantly with symptoms. The other is
basic corrective action which gets to the
source of deviation and seeks to adjust the
differences permanently.
 PERFORMANCE APPRAISAL
METHODS
1. Critical Incident Method: Critical incident
appraisal focuses the raters attention on those critical
or key behaviors that make the difference between
doing a job effectively and doing it ineffectively. What
the appraiser does is write down little anecdotes that
describe what the employee did that was especially
effective or ineffective. This method suffers from
following two drawbacks:
a) Supervisors are reluctant to write these reports on a
daily or even weekly basis for all of their subordinates
as it is time consuming and burdensome for them
b) Critical incidents do not lend themselves to
quantification. Therefore the comparison and ranking
of subordinates is difficult.
2. Checklist : In the checklist, the evaluator uses a
bit of behavioral descriptions and checks of those
behaviors that apply to the employee. The
evaluator merely goes down the list and gives yes
or no responses.
3. Graphic Rating Scale: One of the oldest and most
popular methods of appraisal is the graphic rating
scale. They are used to assess factors such as
quantity and quality of work, job knowledge,
cooperation, loyalty, dependability, attendance,
honesty, integrity, attitudes, and initiative etc.
4. Forced Choice Method: The forced choice
appraisal is a special type of checklist, but the rater
has to choose between two or more statements, all
of which may be favorable or unfavorable. The
appraisers job is to identify which statement is
most descriptive of the individual being evaluated.
5. Management by Objectives: Management
by objectives (MBO) is a process that converts
organizational objectives into individual
objectives. It can be thought of as consisting
of four steps: goal setting, action planning,
self-control, and periodic reviews.
6. Behaviorally Anchored Rating Scales:
These scales combine major elements from
the critical incident and graphic rating scale
approaches. The appraiser rates the
employees based on items along continuum,
but the points are examples of actual behavior
on the given job rather than general
descriptions or traits.
7. Paired Comparison: It ranks each individual
in relationship to all others on a one-on-one
basis. If ten people are being evaluated, the
first person is compared, with each of the other
nine, and the number of items this person is
preferred in any of the nine pairs is tabulated.
8. 360 degree appraisal: The 360 degree
feedback process involves collecting
perceptions about a persons behavior and the
impact of that behavior from the persons boss
or bosses, direct reports, colleagues, fellow
members of project teams, internal ad external
customers, and suppliers.
 Performance appraisal
instruments
In the vast majority of organizations, managers rate
employee job performance on a standardized form. A
variety of forms exist, but they are not equally effective.
To be effective, the form must be relevant and the
rating standards must be clear. To be relevant, the
form must include all the pertinent criteria for evaluating
performance and exclude criteria that are irrelevant to
job performance.
Performance standards indicate the level of
performance an employee is expected to achieve. Such
standards should be clearly defined so that employees
know exactly what the company expects of them.
Most appraisal instruments require raters to evaluate
employees in relation to some standard of excellence.
With employee comparison systems, however, employee
performance is evaluated relative to the performance of
other employees. In other words, employee comparison
systems use rankings, rather than ratings.
 PROBLEMS IN PERFORMANCE
APPRAISAL
1)Leniency Error: Every evaluator has his/her
own value system that acts as a standard
against which appraisals are made. Relative to
the true or actual performance an individual
exhibits, some evaluators mark high and others
low. The former is referred to as positive leniency
error, and the latter as negative leniency error.
2) Halo Effect: The halo effect or error is a
tendency to rate high or low on all factors
due to the impression of a high or low rating on
some specific factor.
3.Similarity Error: When evaluators rate other
people in the same ways that the evaluators
perceive themselves they are making a similarity
error. Based on the perception that evaluators have
of themselves, they project those perceptions onto
others.
4.Recency vs. Primacy Effect: Recency refers to the
proximity or closeness to appraisal period.
Generally an employee takes it easy for the whole
year and does little to get the punishment. However,
comes appraisal time, he becomes very active.
Suddenly there is an aura of efficiency, files move
faster, tasks are taken seriously and the bosses are
constantly appraised of the progress and problems.
All this creates an illusion of high efficiency and
plays a significant role in the appraisal decisions.
Setting performance
standards
A performance standard is a
management-approved expression of
the performance threshold(s),
requirement(s), or expectation(s)
that must be met to be appraised at
a particular level of performance.
A Fully Successful (or equivalent)
standard must be established for
each critical element and included in
the employee performance plan.
 Criteria in developing
performance
General measurers standards
used to measure employee
performance include the following:
Quality: Address how well the work is to be performed
and/or how accurate or how effective the final product is.
Quantity: Addresses how much work is produced. A
quantity measure can also include an error rate, such as
number or percentage of errors allowable per unit of work,
or as a general result to be achieved.
Timeliness: Addresses how quickly, when or by what
date the work is produced. The most common error made
in setting timeliness standards is to allow no margin for
error.
Cost-Effectiveness: Addresses financial savings to
the organization. Cost-effectiveness standards may include
such aspects of performance as maintaining or reducing
unit costs, reducing the time it takes to produce a product
or service, or reducing waste.
 Advantages of performance
standards
Employee performance standards bring broad benefits to the
organization
1.They inform as the progression towards achieving goals
2.They guarantee whether goals have been achieved
3.They significantly reduce stress for managers
4.They permit objective assessment of the on job performance of
employees
5.They are the foundation of successful on the job training.
6.They clarify job expectations
7.Employees identify as to what is most important
8.Employees know how their performance will be measured
9.They generate superior management information to enable
managers to make better decisions
10.Managers can take prompt action when standards arent being met
11.They remove the need for close supervision
12.They form the foundation for successful operating systems
13.They provide accurate and relevant information to use in
determining rewards and incentives
14.They enable formal performance appraisal to be based on accurate,
relevant performance based data: not behavior, opinion and hearsay
 Time Management
Time Management is more than just managing time.
It is about controlling the use of the most valuable
- and undervalued - resource.
It is managing oneself in relation to time. It is
setting priorities and taking charge of the
situation and time utilization. It means changing
those habits or activities that cause waste of time.
It is being willing to adopt habits and methods to
make maximum use of time.
According to North (2004), time management is the
organization of tasks or events by first estimating
how much time a task will take to be completed,
when it must be completed, and then adjusting
events that would interfere with its completion is
reached in the appropriate amount of time.
Advantages of time
management
Helps to take control of many areas of your
life.
Increases productivity.
Helps to become more organized.
Helps to utilize time effectively.
Helps to relax and do the things that we
enjoy doing.
 Symptoms of Poor Time
Management
The following are some of the indicators of
poor time management:
Constant rushing (e.g. between meetings or
tasks)
Frequent delays (e.g. in attending meetings,
meeting deadlines)
Low productivity, energy and motivation
Frustration
Impatience
Chronic vacillation between alternatives
(confused in making decisions)
Difficulty setting and achieving goals
Time stealers
1. Poor Planning
2. Crisis Management
3. Procrastination
4. Interruptions
5. Not Delegating
6. Unnecessary Meetings
7. Disorganized
8. Poor infrastructure
9. Poor attitude
10. Negative people
How managers can
effectively use time
Managers should concentrate on important task to
increase their productivity save their time.
Need to prioritize tasks
Developing a sense of urgency
Avoid procrastination
Accept mistakes and take correction steps, do not
over react.
Assertiveness learning to say NO
Effective delegation
Recognizing problem people
Dealing with interruptions
Learning new skills and tasks
Managing mails
Module III
Management style:
Relationship orientation; Task
orientation; Working in teams:
Team development; coaching
and training; Leadership Skills
and Motivation. Setting
objectives and targets; Setting
smart goals; chasing targets;
 Management style
Management Styles : Management style can be
understood as a way to manage an organization.
According to Schleh (1977), management style is
the adhesive that binds diverse operations and
functions together. It is the philosophy or set of
principles by which the manager capitalizes on
the abilities of the workforce. Management style
is not a procedure on how to do but it is the
management framework for doing.
A management style is a way of life operating
throughout the enterprise and permits an
executive to rely on the initiative of the
personnel of an entity.
Task oriented
management style
Task-oriented management The task-
oriented manager focuses on the job, and
concentrates on the specific tasks assigned
to each employee to reach goal
accomplishment.
This management style suffers the same
motivational issues as autocratic
management style, showing no involvement
in the teams needs.
It requires close supervision and control to
achieve expected results (Fiedler,1967).
Advantages of task-oriented management style:
Deadlines are met and jobs are completed
Useful for team members who don't manage their
time well
Task oriented managers exemplify strong
understanding of how to get the job done by focusing
on the necessary workplace procedures, thus can
delegate work accordingly in order to ensure that
everything gets done in a timely and productive
manner.
Disadvantages
Does not focus on team's well-being
May likely turn to be autocratic, causing motivation
and retention problems.
Relationship oriented
management style
Relationship-oriented style focuses on
supporting, motivating and developing the
people on their teams and the relationships
within.
It encourages good teamwork and collaboration,
through fostering positive relationships and
good communication.
Priority is for the welfare of everyone in the
group
Involves offering incentives like bonuses,
providing mediation to deal with workplace
issues in a non-competitive and transparent
work environment.
Advantages of relationship oriented
management style:
Focus on well being of the subordinates
Managers promote a positive environment for
positive productivity
Team members may be more willing to take
risks, because they know that the manager will
provide the support if needed.
Disadvantages :
Relationship orientation likely to detract from
the actual tasks and goals at hand
Sacrifices productivity for relationships
Working in teams
Working in teams ..\Team Work - Birds.mp4
Team work
..\The Vocal People-Amazing Creative Team
work.mp4
Team work working in Teams.pptx
Team development through coaching and
training
Coaching is centered on unlocking a persons potential
to maximize his or her own performance. A focus on
improving performance and the development of skills
is the key to an effective coaching relationship.
There are generally two accepted forms of coaching:
directive and non-directive.
Directive is a form of coaching whereby the coach
teaches and provides feedback and advice.
In contrast, non-directive coaching requires the
coach to listen, ask questions, explore and probe and
allows the person coached to find solutions to
problems.
Coaching can be applied to a variety of areas, such as
motivating staff, delegating, problem solving,
relationship issues, teambuilding, and staff
development.
Coaching can be used for building and
motivating teams. Team coaching
establishes a group of individuals into a
functioning business network. The team is
then asked to brainstorm the options
available to them and agree an action
plan formulated by the group. Developing
a set of ground rules which are acceptable
to all team members is vital, because this
will ensure that the group is working to
the same agenda. Regular meetings are
needed, and team members may also
want to structure social time together.
 Developing teams
Brower and Carr proposed eight key points
that can facilitate the successful development
of a successful team. They are :
1. Clear goals
2. Decision making authority
3. Accountability and responsibility
4. Effective leadership
5. Training and development
6. Resources
7. Organizational support, and
8. Rewards for team success
1. Clear goals: Goals should be specific enough to give
the team direction. Providing clear goals enable
members to create meaningful and acceptable
performance measures so that the team members
can feel confident in their own achievements.
2. Decision making authority: Teams require
decision making authority and, therefore, a certain
level of empowerment enables them to carry out
their work efficiently.
3. Accountability and responsibility: The
acceptance of accountability and responsibility
enables to establish a positive and productive set of
group norms that improve cohesion of the group.
4. Effective leadership: Effective communication,
leadership and consulting skills will be required for
the success of the team.
5. Training and development: Training and development
are enabling factors that allow team members and leaders
to take on new responsibilities. Where team members
possess inadequate work skills and knowledge, teams are
less likely to succeed
6. Resources: For teams to operate effectively they must
have access to resources. These resources can include
money, time, equipment, technology, people and
information.
7. Organizational support: Teams cannot operate
without the support and commitment of middle and upper
management. A nurturing environment with a collaborative
climate provides the support and encouragement that
teams need for job performance
8. Rewards for team success: A team-based reward
system should reward employees for teamwork and
contributions to team success. Rewards encourage team
members to strive for team goals that are congruent with
the goals of the organization.
 Team conflicts
Conflict is an expressed struggle between at least two
interdependent parties who perceive incompatible
goals, scare resources, and interference from others
in achieving their goals.
Stages of Conflict:
Indirect or Latent conflict: At this stage the conflict
is within the people involved but is unexpressed.
Open conflict: At this stage the parties involved
express their disagreements. The divergence in the
parties is apparent at this stage.
Escalation and power tussle: At this stage the
conflict escalates and the opponents start using
power. The conflict turns into a violent one.
Climax or violent stage: This is stage where violent
conflict is at its maximum. At this stage the
opponents look to eliminate one another.
Causes of conflict
Poor or no communication
Lack of problem solving skills
Lack of clarity in purpose, goals, objectives,
team and individual roles
Uncertainty about or lack of resources and
sources for help and support
Poor time management
Lack of leadership and management
Team members bored, not challenged, not really
interested
Lack of skills and abilities in team members
Personality conflicts
Personal problems
Turnover
 Effects of conflict
Positive effect
A conflict gives positive effects if it is handled
constructively.
Positive change in the society/community
Opportunity for newer possibilities
Renewal in relationships
Increase in productivity of all sectors
Negative effect
The effects of conflict will be negative if proper conflict
management is not done.
Increase in stress in people
Decrease in production
Degradation in relationships and worsening
cooperation.
Restricted areas increase
Increase in the possibilities of violent conflict
Resolving conflicts
Clearly articulate thoughts and ideas
Practice active listening
Clarify and question effectively
Give effective feedback
Analyze in a methodical and systematic way
Set clear, reasonable, achievable objectives
Stick to facts and issues, not personalities or
personal issues
Develop the ability to work effectively as a team
member
Use delegating and mentoring for senior employees
Leadership
Leadership lessons Narayana Murthy
 Leadership
There is continuous debate about whether leaders
are born or developed.
Leadership may be defined as: the influence that
particular individuals (leaders) exert upon the goal
achievement of others (subordinates) in an
organizational context.
Leadership has two distinct aspects: i) the
individual who
exerts influence, and ii) those who are the objects
of this influence.
Successful leadership depends, to a large extent,
on the environment and situation in which these
dynamics exist.
There are two types of leaders:
Emergent leaders - those who earn leadership
positions through their expertise, skills, abilities to
influence others, or personal acceptability by the
group
Assigned leaders - those who are given power to
exercise influence through appointment.
However leaders must be able to provide social
and emotional support to the group by listening,
acknowledging, team building, and supporting
other members in the group. This is referred to as
social-emotional support.
Leaders also provide direction and assistance to
the group in accomplishing their tasks.
Successful leaders have the ability to identify and
apply the appropriate strategy at the right time.
 Leadership behaviors
According to Robert House, the most important activities of
leaders are those that clarify the path to various goals of
interest to subordinates, thus effective leaders form a
connection between subordinate goals and organizational
goals. There are four different kinds of leader behaviour.
These include:
1.Directive behaviour: This includes scheduling work,
maintaining performance standards, and letting
subordinates know what is expected from them.
2.Supportive behaviour: includes being friendly,
approachable, and concerned with pleasant interpersonal
relationships.
3.Participative behaviour: consult with their subordinates,
and consider their opinions.
4.Achievement-orientated behaviour: motivates
subordinates to exert higher efforts and strive for a higher
level of goal accomplishment.
 Leadership style
Victor Vroom and Arthur Jago maintained that there are
three different types of leader behaviour.
Autocratic: This style states that the leader solves the
problem or makes the decision using information available
to him or her at the time.
Consultative: The leader shares the problem with
subordinates and gets their input. Subordinate involvement
is seen as either a collective or individual request for
information which may or may not influence the decision.
The leader reserves the right to make that decision.
Group: The leader shares the problem with subordinates
as a group, obtains their collective input and tries to reach
consensus on the solution. The leader acts as a facilitator or
chairman, trying not to influence input and accepting any
solution that the group may suggest.
Motivation
Motivation can be defined as the extent to
which persistent effort is directed toward a
goal(Campbell, Dunnette, Lawler &Weick).
People may be motivated by factors in the
external environment such as pay,
supervision, benefits, and job perks. This is
referred to as extrinsic motivation. They
may also be motivated by the relationship
between the worker and the task. This type
of motivation is called intrinsic motivation.
 Maslows Hierarchy of Needs
Physiological needs: These include the need for food, water,
shelter, clothing and money.
Safety needs: These include security, stability, and a structured
environment. Here, the individual expects and pursues job
security, a comfortable work environment, pension and
insurance plans, and freedom to organize in order to ensure
continuation of these benefits.
Relationship needs: Relationship needs include socialization,
affection, love companionship, and friendship. The individual at
this level participates for personal or intrinsic rewards.
Esteem needs: These include feelings of adequacy,
competence, independence, confidence, appreciation, and
recognition by others. Again, the individual is driven more by
internal or intrinsic needs.
Self-actualization: This area is the most difficult to define and
therefore, may be the most difficult to explain. Different people
have different ideas about what they need to achieve in order to
obtain true happiness. Organizational requirements may include
the opportunity for creativity and growth.
Alderfers ERG Theory
Existence needs: These include needs that
are satisfied by material substances or
conditions.
Relatedness needs: These are needs that
may be satisfied by communication, or
exchange and interaction with other
individuals.
Growth needs: These are needs that are
fulfilled by strong personal involvement
that fully utilizes our skills, abilities, and
creativity.
 McClellands Theory of
NeedsDavid McClelland contends that we develop a
Psychologist
relatively stable personality early in life and that, once
acquired, remains unchanged. He categorizes leaders into
three categories based on behavior
Need for achievement: Individuals in this category have a
strong desire to perform challenging tasks. They take
personal responsibility for successful outcomes. The goals
they set will be with moderate and calculated risk, and the
individual seeks performance feedback to allow for
modification and to ensure success.
Need for affiliation: People in this category display a need
to establish and maintain friendly, compatible
relationships. They have a need to like other people and
want others to like them. They have an ability to create
social networks that will result in meeting these needs.
Need for power: People in this category have a strong
need to have influence over others. They wish to make a
significant impact and impression on those with whom
they come in contact.
Setting objectives and
targets
Performance targets have been defined as the
objects or aims of managerial action or as
borderlines that differentiate success from
failure.
They are one of the most commonly used
motivational tools in the corporate world.
Performance targets are key mechanisms for
improving motivation and organizational
performance.
However performance targets can be detrimental
for organizations as they generate stressful work
environments, a low trust culture, data
manipulation and financial performance losses.
Difference between Target and
Objective
Target: the exact result that a person or organization
intends to achieve by doing something, often the
amount of money they want to get; a particular
amount or total that you want to achieve:
The company is on track to meet its target of
increasing profits by 10%.
Objective:the specific thing that you are trying to
achieve - used especially about things that have been
officially discussed and agreed upon in business,
politics, etc. and agreed upon in business, politics,
etc.:
Their main objective is to halt the flow of drugs.
We met to set the business objectives for the coming
year.
Purpose of setting
targets/objectives
To prioritize areas of improvement
and, thereby, focus efforts and
resources on priorities
To Motivate for achieving specific
performance milestones
To Create a sense of ownership
To make objectives more
understandable and meaningful for
managers and subordinates
Steps towards achieving
Targets/objectives
1. Decide the performance area of
improvement E.g.: Sales /market share
2. Prioritize areas of improvement.
3. Define the outcome. E.g.: Growth in
product/market share
4. Identify the appropriate indicators for
measuring the outcome. E.g.: Growth
volume/change in market share
5. Reviewing baseline. E.g.: Break even
6. Review trends and history
7. Take account of national targets
8. Consult expert opinion on what is
possible or feasible
9. Benchmarking best performance
(identifying best performance in similar
situations)
10. Develop an action plan for achieving
the target
11. Monitor progress and revise inputs,
interventions or target accordingly
Setting SMART goals
Specific Specifically define what you expect
the employee to do/deliver. Avoid generalities
and use action verbs as much as possible.
WHAT do I need the employee to do? These are
best written using strong, action verbs such as
conduct, develop, build, plan, execute, etc. This
helps your objective to be action-orientated and
focuses on whats most important..
WHY is this important for the employee to do?
WHO else needs to be involved?
WHEN do I want this to be completed?
HOW is this assigned task to be done?
Diagnostic Questions
What exactly in the employee going to do, with or
for whom?
What strategies will be used?
Is the objective well understood?
Is the objective described with action verbs?
Is it clear as to who is involved?
Is it clear where this will happen?
Is it clear what needs to happen?
Is the outcome clear?
Will this objective lead to the desired results?
Example: resolve accounting discrepancies within 48
hours.
Measurable It is necessary to measure whether the
employee is meeting the goals or not. Identify how goals
can be measured - usually stated in terms of quantity,
quality, timeliness or cost (e.g. increase by 25%).
Measurement is the standard used for comparison. As its
so often said if you cant measure it, you cant manage it!
Its important to have Performance measures that will
encourage and motivate employees.
Measurements go a long way to help your employees know
whether they are performing up to organizational standards.
Diagnostic Questions
How will I know that the change has occurred?
Can these measurements be obtained?
Example: Sell insurance policies from ten new customers
by the end of each week.
Achievable - Make sure that accomplishing the goal is within
the employee's realm of authority and capabilities. The goal
assigned should incorporate individual and group goals.
SMART goals need to be achievable and should stretch
employees, but not so far that he or she becomes frustrated
and loses motivation.
Diagnostic Questions
Are the goals you set achievable and attainable?
Can the employee successfully complete this goal with the
skills, resources and time available to them?
Are there factors beyond their control that need to be
considered?
Can the employee get it done in the proposed timeframe?
Does the employee understand the limitations and
constraints?
Has anyone else done this successfully?
Is this possible?
Example: obtain the XYZ professional certification within two
years.
 Realistic Realistic means that there are
resources to get it done. The achievement of an
objective requires resources,
such as, skills, money, equipment, etc. to do the
task required to achieve the objective. Ensure the
goal is practical, results-oriented and within the
employee's realm of authority and capabilities.
Relevant: Goals should be linked to a higher-level
i.e. departmental or organizational goal, and ensure
that the employee understands how their goal and
actions contributes to the attainment of the higher
level goal. This gives the employee a context for
their work. Relevant also means that the outcome or
results of the work directly support the business
needs of the agency or priority area.
Diagnostic Questions
Does the employee have the resources
available to achieve this goal?
Do I need to clarify unit priorities to the
employee to ensure that this goal is
achieved?
How can I help the employee see the
relationship between this SMART goal and
the organizational mission?
Example: Develop and implement a gender
diversity recruitment plan that increases the
gender parity by ten percent.
Time-bound When does the objective need to be
completed? Specify when the goal needs to be
completed (e.g. by the end of Q2, or every month).
Time-bound means setting deadlines for the
achievement of the objective. Deadlines need to be
both achievable and realistic. Timeframes create the
necessary urgency and prompts action. Timeframes
also add measurability and provide a clear yardstick
as to whether work is being done to expected
standards.
Diagnostic Questions
When or how often the response (reports /
summaries / agendas/schedules/status updates are
required)?
Is there a stated deadline?
Example: Check the fire alarms and emergency
lighting in all buildings every six months.
 Examples of SMART goals
Sample SMART goals for Customer Service:
I. Improve customer service satisfaction ratings by
90% by the end of the calendar year, as
determined by customer satisfaction surveys.
2. Increase the number of people who visit our
Athletics web site to 80% by the end of February.
I. Respond daily to voice mails or calls concerning
the status of ordered supplies or equipment.
II. There should not be no more than 2 valid
complaints from faculty and staff about lack of
supplies during the performance cycle.
Sample SMART goals for Work Coordination:
Train and guide secretaries in units reporting to
ISO guidelines by explaining proper form
completion, communicating new or revised policies,
and conducting formal orientations and training
meetings.
Orientations of new employees to occur within
one month of hire.
Rooms for events and meetings are scheduled
two weeks in advance with meeting locations for
each event or meeting communicated one week in
advance.
A master calendar for the upcoming years events
is submitted for approval by August 15th
Sample SMART goals for Staff Development:
Set up customer feedback systems to monitor and
evaluate employees responses to customer concerns
on the last day of the month.
Attend at least one HR Management training session
per year and submit a short summary of new
understanding on HR policies/procedures
Sample SMART goals for Information
Administration:
Accurately process 50 housing applications per day.
Review employee time sheets for accuracy and
compliance and submit to payroll according to prior to
established deadlines. Outcome: No delays or errors
in employees pay
Sample SMART goals for Budgeting:
Submit to the Director by the 15th of each month, a
monthly budget report that summarizes for the
previous month the total spent in all budget
categories and balances for all categories. This report
should also briefly document any budget concerns
and forecasts.
Review the budgets of the reporting departments
on a monthly basis and alert them by the 5th of each
month to possible issues that should be addressed.
Accounts are not over-expended or depleted without
the account manager being informed. Accounts are
managed efficiently at year-end with all expenditures
managed based on Budget Office guidance.
For an organization or department
Not SMART: Improve our student service.
SMART Achieve and maintain an average student
service rating of at least 4.0 (out of a possible 5.0) on
our annual survey by 11/20/08.
Not SMART : Create our 2008 strategic plan.
SMART Create our 2008 strategic plan, obtain final
approval from the Budget Committee, and discuss it
with our department so individuals can begin setting
their performance objectives by 8-29-07.
Not SMART Improve project management skills.
SMART Take the Project Management Essentials
workshop on 10-18-2007, report what was learned to
our team by 11-01-2007, and apply the relevant
concepts while implementing our 2008 marketing plan.
Create SMART plans for the
following statements
Send out welcome letters to our new
students.
Be more receptive to coaching
suggestions and feedback.
Keep our departments Website up-to-
date.
Answers
SMART Produce and distribute personalized welcome
letters, error free, to all new students in our department
by 9-26-07.
SMART At our monthly progress meetings, ask for
feedback on what you are doing well and what things to
improve. Keep a notebook with this information, try out
the suggestions, and document each week what worked
and what didnt.
SMART Solicit updates and new material for the
Website from our department managers on the first
Friday of each month; publish this new material by the
following Friday. Each time material is published, review
the Website for material that is out-of-date and delete or
archive that material.
 Chasing goals/targets
Edwin Locke and Gary Latham defined goal as a
what an individual is consciously trying to do.
Locke and Latham postulate that ones experiences'
and value judgments create a desire to achieve
goals.
Locke and Latham concluded that direct attention
and action are required for achieving goals.
Furthermore, challenging goals mobilize energy, lead
to higher effort, and increase persistent effort. Goals
motivate people to develop strategies that will enable
them to perform at the required goal levels.
Finally, accomplishing the goal can lead to
satisfaction and further motivation, or frustration and
lower motivation if the goal is not accomplished.
 Achieving Goals/Targets
Targets must be specific:
Organization members perform at higher levels when
asked to meet a specific high-performance target.
Research indicates that specific goals help bring about
other desirable organizational goals, such as reducing
absenteeism, tardiness, and turnover (Locke & Latham,
2002).
Targets must be difficult but attainable:
A goal that is too easily attained will not bring about
the desired increments in performance. The key point is
that a target must be difficult as well as specific for it to
raise performance.
As Targets become too difficult, performance suffers
because organization members reject the Targets as
unreasonable and unattainable.
The first key to successful target setting is to build and
reinforce employees self-efficacy.
Targets Must Be Accepted
Targets need to be accepted. Simply assigning Targets to
organization members may not result in their commitment to
those targets, especially if the target is difficult to be
accomplished.
A powerful method of obtaining acceptance is to allow
organization members to participate in the target-setting
process.
Participation helps organization members better understand
the targets, ensure that the targets are not unreasonable, and
helps them achieve the target.
Provide feedback:
Feedback helps members as to determine how well they are
doing.
Feedback also helps people determine the nature of the
adjustments to their performance that are required to improve.
Targets are More Effective When They Are
Used to Evaluate Performance
When employees know that their performance
will be evaluated in terms of how well they
attained their goals, the impact of target also
increases.
CEOs of organizations such as IBM, General
Motors, and Microsoft Corporation are evaluated
on meeting growth, profitability, and quality goals.
Deadlines Improve the Effectiveness of
Targets
For most employees, goals are more effective
when they include a deadline for completion.
Deadlines serve as a time-control mechanism
and increase the motivational impact of goals.
Module IV
Indicators of performance for
different levels of management;
Criteria for evaluating performance
of junior level managers, middle
level managers and top level
managers; Tracking performance;
Feedback management for
performance improvement
 Indicators of performance
for different levels of
management
Aperformance indicatoror keyperformance
indicator(KPI) is a type
ofperformancemeasurement used by
organizations to evaluate its success, or to
evaluate the success of a particular activity in
which it is engaged.
Key Performance Indicators are quantifiable
measurements, agreed to beforehand, that reflect
the critical success factors of an organization.
KPIs reflect the organization's goals.
E.g.: Customer Service Department may have
percentage of customer calls answered in the first
minute as a KPI.
 Managerial levels
Top-level managers, or top managers, are also called
senior management or executives. These individuals are at
the top one or two levels in an organization, and hold titles
such as: Chief Executive Officer (CEO), Chief Financial
Officer (CFO), Chief Operational Officer (COO), Chief
Information Officer (CIO), Chairperson of the Board,
President, Vice president, Corporate head.
Top-level managers make decisions affecting the entirety
of the firm. Top managers do not direct the day-to-day
activities of the firm; rather, they set goals for the
organization and direct the company to achieve them. Top
managers are ultimately responsible for the performance
of the organization, and often, these managers have very
visible jobs.
Some CEOs are hired in from other top management
positions in other companies. Conversely, they may be
promoted from within and groomed for top management
with management development activities, coaching, and
mentoring. They may be tagged for promotion through
succession planning, which identifies high potential
managers.
MIDDLE-LEVEL MANAGERS
Middle-level managers, or middle managers, are
those in the levels below top managers. Middle
managers' job titles include: General manager, Plant
manager, Regional manager, and Divisional manager.
Middle-level managers are responsible for carrying
out the goals set by top management. They do so by
setting goals for their departments and other business
units. Middle managers can motivate and assist first-
line managers to achieve business objectives. Middle
managers may also communicate upward, by offering
suggestions and feedback to top managers. Because
middle managers are more involved in the day-to-day
workings of a company, they may provide valuable
information to top managers to help improve the
organization's bottom line.
Depending on the size of the company and the
Junior Level Managers or First-level managers
are also called first-line managers or
supervisors. These managers have job titles
such as: Office manager, Shift supervisor,
Department manager, Foreperson, Crew leader,
Store manager.
First-line managers are responsible for the daily
management of line workersthe employees
who actually produce the product or offer the
service. There are first-line managers in every
work unit in the organization. Although first-
level managers typically do not set goals for the
organization, they have a very strong influence
on the company. These are the managers that
most employees interact with on a daily basis.
 Top-levelmanagersare responsible for controlling and
overseeing the entire organization hence top level managers
are assessed on key performance indicators like Financial
results, Gross profit, Net income, Cost control, Cash
management, Marketing strategies, PR targets, Sales
numbers and ability to make changes in revenue, procedures,
schedules; appointment of middle level executives such as
department managers; coordination of departments; media
and governmental relations; and shareholder communication.
Middle-level managers are responsible for executing
organizational plans which comply with the company's
policies.
Hence Middle level managers are assessed on KPIs like
executing organizational plans in conformance with the
company's policies and the objectives of the top
management, define and discuss information and policies
from top management to lower management, inspiring and
provide guidance to lower level managers towards better
performance. effective group and inter-group work and
information systems, monitor group-level performance,
Diagnose and resolve problems within and among work
groups, Design and implement reward systems that support
cooperative behavior.
First Level or Junior managers or Low level
managers are assessed on, guiding and
instructing workers for day to day
activities, quality and quantity of
production, maintaining good relationships
within the organization, communicating
workers problems, suggestions, and
recommendatory appeals, to the higher
authorities, guiding sub-ordinates,
training to the workers, arranging
materials, machines, tools etc., preparing
periodical reports about the performance of
the workers, ensuring discipline, and
motivating workers.
Tracking performance
Organizations that track performance of
employees are able to improve their employees
efficiency and enhance the effectiveness of their
operations. However, it can be difficult to know
what to track, given the number of inputs and
outputs processed by a company. There are some
basic tracking methods that management can use
to gauge employee and organizational
performance.
Organizations track employee performance for
improving organizational effectiveness and
productivity. The tracking functions includes:
Employee performance on budgets and targets
Employee attendance
Paid time off, vacation time, sick days, leave etc.
Skills, competencies, training and development
initiatives
 Tracking progress - methods
Performance Reviews: Standardized
performance review sheets allow managers to
track employees fulfillment of, and progression
toward, operating objectives over time.
In addition to managerial ratings, many forms have
spaces for employees to rate their own
performance, which facilitates a discussion
between both parties.
Categories on a performance review sheet can
include everything from interpersonal skills to error
rates and customer complaints.
Performance review sheets are subjective in nature
but are a viable means of tracking performance
and can be stored in paper or digital form.
Peer Appraisals
Peers often have opinions about their co-workers
performance, which has led some entities to
implement peer appraisals.
Appraisals are tracked on sheets or in a
database and provide a valuable source of
feedback for employees and their managers.
Appraisals can be tracked over multiple reporting
periods to trend data, which helps identify
favorable and unfavorable patterns of behavior.
Although peer appraisals are subjective and
prone to bias, they still provide a viable means to
measure and track employees performance.
Dashboards
Many companies use standardized dashboards to
track organizational or department performance.
Dashboards can include a variety of metrics that
depend on the key process indicators or critical
success factors an organization wants to measure.
For an accounting department, dashboards can
include error rates for journal entries, reconciliations
and invoice processing.
For a manufacturing department, it might include
scrap and defect rates among other efficiency ratings.
Dashboards allow business leaders and employees to
track their performance in an objective manner.
Customer response
sheets
Tracking employee complaints is important for quality
assurance, which is why many companies track the
voice of the customer.
Tracking mechanisms differ but can include Excel
spreadsheets or databases designed to capture
product or service failures.
For a magazine, the voice of the customer might
cover categories such as grammar or spelling errors. It
may also cover editorial or content preferences, which
are important for maintaining and growing readership.
Tracking customer complaints and preferences allows
business leadership to adjust operations and meet the
needs of clients.
 Feedback management for
performance
Feedback is Information about reactions to a
product, a person's performance of a task, etc.
which is used as a basis for improvement.
Performance feedback process is an ongoing
communication between managers and employees.
The exchange of information involves both
performance expected and performance exhibited.
Performance in organizations are managed
primarily through peer feedback and emulation.
Giving feedback should be done routinely in both
team and individual level.
Feedback is especially powerful when it is it is
intentionally non-judgmental, and given in a spirit
of open exploration and acceptance.
Feedback management for performance
improvement
Effective and timely feedback is a critical
component of a successful performance
management program and should be used in
conjunction with setting performance goals.
Effective feedback given to employees on
their progress towards their goals, can enable
the employee to perform and improve.
Feedback can come from many different
sources: managers and supervisors,
measurement systems, peers, and
customers. However feedback should cover
certain elements for making it effective.
Specificity and Timeliness
Feedback works best when it relates to a specific goal.
Establishing employee performance expectations and goals
before work begins is the key to providing tangible,
objective, and powerful feedback.
E.g.: Telling employees that they are doing well because
they exceeded their goal by 10% is more effective than
simply saying "you're doing a good job.
Employees should receive information about how they're
doing as timely as possible.
This will enable them to make improvements in their
performance, the sooner they find out about it the sooner
they can correct the problem.
If employees have reached or exceeded a goal, the sooner
they receive positive feedback, the more rewarding it is to
them.
 Feedback - Process
Feedback should be given in a manner that will best
help improve performance. Since people respond
better to information presented in a positive way,
feedback should be expressed in a positive manner.
Feedback is more effective when it reinforces what
the employee did right and then identifies what needs
to be done in the future.
Kinds of feedback: Planned and Natural
Natural has two types 1. Self evident and 2.
Automatic
Self evident can be seen by the person as they
work. For e.g.: Targets in Quantity and volume
Automatic can be understood as the employee
works. For e.g.: such as a production or printing
process, i.e. so many copies printed per day as
determined by machine count
Planned feedback: Feedback planned either
manual or automatic by the manager.
Module V
Organizational culture and managerial
performance: Developing appropriate culture
for superior performance; Focusing individual
and organizational learning on improved
performance; Performance based cultures and
structures. Rewards and performance -
Defining appropriate reward systems; Ensuring
the link between performance and rewards;
Limitations and boundaries of performance
related rewards; Using effective methods of
reviewing performance and development;
 Organizational culture
A pattern of basic assumptions that the group learned as it solved
its problems of external adaptation and internal integration, that
has worked well enough to be considered valid and, therefore, to
be taught to new members as the correct way to perceive, think
and feel in relation to those problems. Schein, 1992
Organizational culture represents the culture that is construed by
the assumptions and beliefs of the managers and employees.
Organizational Culture is manifested in beliefs and assumptions,
values, attitudes and behaviors of its members is a valuable
source of firms competitive advantage.
OC shapes the organizational procedures, unifies organizational
capabilities into a cohesive whole, provides solutions to the
problems faced by the organization, and, thereby, hindering or
facilitating the organizations achievement of its goals .
Alsocalledcorporate culture, it is shown in:
The ways the organizationconductsitsbusiness, treats its
employees, customers, and the widercommunity.
OC defines the extent to whichfreedomis allowed indecision
making, developingnewideas, and personal expressions.
OC also defines howpowerandinformation flowthrough
itshierarchy, and the commitment employees show towards
collectiveobjectives.
Functions of Organizational
Culture
Culture provides a sense of identity to
members and increases their
commitment to the organization
Culture is a sense-making device for
organization members
Culture reinforces the values of the
organization
Culture serves as a control mechanism
for shaping behavior
 Organizational Culture Research
Suggests:
1. Organizational culture was found to be
correlated with employee attitudes and behavior
2. Organizational culture had an influence with
individuals values and the organizations values
associated with organizational commitment, job
satisfaction, intentions to quit, and turnover.
3. An organizational culture with a consensus on
the values drives a company with an intensity
that is recognizable even to outsiders.
4. They are characterized by goal alignment
5. They create a high level of motivation because
of shared values by the members
6. They provide control without the oppressive
effects of bureaucracy.
 Affect of Organizational
culture
Organizational culture affects the organizations
productivity and performance,
andprovidesguidelineson customer care
andservice,product qualityandsafety, attendance
and punctuality, andconcernfor the environment.
It also extends to production-methods marketing and
advertisingpractices, and tonew productcreation.
Organizational culture is unique for every
organization and one of the hardest things
tochange.
A positive and strong culture can make an average
individual perform and achieve brilliantly whereas a
negative and weak culture may demotivate an
outstanding employee to underperform and end up
with no achievement.
 Frame work for
organizational
Denison cultureculture
has proposed an organizational
model which is based on four cultural traits -
involvement, consistency, adaptability, and mission.
Involvement: Effective organizations empower their
people, build their organizations through involving
people and developing human capability at all levels.
Consistency: Organizations that have strong
cultures tend to be effective because they are highly
consistent, well coordinated, and well integrated.
Adaptability: Organizations having strong cultures
also adapt to their environment by focusing on
customer needs, and learning from their mistakes.
Mission: Organization having strong cultures have a
clear sense of purpose and direction that defines
organizational goals and strategic objectives and
expresses its vision on how the organization will look
in the future.
 Culture for superior
performance
Creating a performance culture requires a systematic approach to
managing the performance of organizations, teams and individuals.
The performance culture should be based on discipline. This
discipline promotes decisiveness and standards of excellence and
ensures direct accountability. In order to make the performance
culture work, organizations must have the following:
Openness and trust: An environment of trust where people
react more honestly, ask questions more frequently, and are more
spontaneous with their comments and ideas, enable the
organization to derive greater value from its talent, and enable
employees to develop their competence and contribute to success.
Managed differences: Conflicts are addressed, unfulfilled
commitments are exposed, alternatives and options are looked at
without a predetermined outcome.
Simplicity and focus: Sharp focus on implementation, with
clarity and precision in defining what needs to be accomplished and
how. There is a commitment at all levels in the way of doing
business.
Playing to peoples strengths: Understanding peoples
strengths and how best to elicit them helps them to learn and build
on their strengths.
 Individual and organizational
learning for improved
performance
Organizational learning (OL) is considered to be one of
the most promising concepts in the modern management.
Organizational learning refers to the study of learning
process within and between organizations.
Senge (1990) defines organizational learning as a
continuous testing of experience and its transformation
into knowledge available to the whole organization and
relevant to their mission
Organizational learning process is a sequence of three
phases: Information Acquisition, Information
Interpretation, and Behavioral And Cognitive
Changes.
Companies that have developed a strong learning culture
are good at creating, acquiring and transferring
knowledge, as well as modifying behavior to reflect new
knowledge and insight.
Organizational learning is considered to be a
fundamental aspect of competitiveness,
knowledge acquisition and performance
improvement.
Positive changes in the way people act
(behavioral changes) and perceive their internal
and external environments (cognitive changes)
are expected to have a positive impact on
organizational performance.
The impact of organizational culture,
organizational practices such as performance
management could be counterproductive
because the two are interdependent and change
in one will impact the other.
 Rewards and performance
According to Baratton (1999) rewards refer to all form
of financial returns and tangible services and benefits
and employee receives as part of an employment
relationship. Reward is the benefits that arise from
performing a task, rendering a service or discharging a
responsibility (Colin, 1995).
According to Searle (1990), rewards can be
categorized into two broad areas, namely extrinsic
rewards and intrinsic rewards.
Extrinsic rewards are usually financial or tangible
rewards which include pay, promotion, interpersonal
rewards, bonuses and benefits (Zaman, 2011). Stoner
and Freeman (1992) defined intrinsic rewards as the
psychological reward that is experienced directly by an
employee.
Rewards for organizational
performance
Reward system helps to increase employee
performance by enhancing employee skills, knowledge
and abilities in order to achieve organizational
objectives.
Reward practices play a vital role in improving
employee performance and to achieve organizational
goals.
Employee rewards directly attach to employee
performance. if organization fails to reward employees,
it will directly affect to decrease employee
performance
An efficient reward system can be a good motivator,
but an inefficient reward system can lead to
demotivate the employees in terms of low productivity,
internal conflicts, absenteeism, high turnover, lack of
commitment and loyalty, lateness and felling
grievances.
 Philosophy of Rewards
Strategic approach: Rewards should
have long-term focus & must be derived
from the business strategy
Total Reward Approach: All
approaches of reward (financial or not) a
should be coherent whole and in
integration with other HRM strategies
There must be Differential rewards
according to the contribution
Finally rewards should reflect - Fairness,
equity, consistency, and
transparency
 The 4Ps of Reward
Pay
Salary, bonus, shares, etc.
Praise
Positive feedback, commendation, staff-of-
the-year award, Star performer etc.
Promotion
Status, career elevation, secondment, etc.
Punishment
Disciplinary action, withholding pay, or
criticism, etc
Types of Rewards - Individual
Contingency Pays
Performance-related: Increases basic pay
or bonuses related to assessment of
performance
Competence related: Pay increases related
to the level of competence
Contribution-related: Pay is related both to
inputs and outputs
Skill-based: Pay is related to acquisition of
skills
Service-related: Pay is related to service-
time
Team based pay
Pay is related to team performance
It can encourages teamwork, loyalty
and co-operation
It can be demotivating on individual
level
Organisaton-wide
schemes
Profit-Sharing Plans organization-
wide programs that distribute
compensation based on an established
formula designed around profitability
Gain Sharing compensation based
on sharing of gains from improved
productivity
Employee Stock Ownership Plans
(ESOPs) plans in which employees
acquire stock, often at below-market
prices
Monetary rewards
Monetary incentives reward workers for
performance and productivity through
money.
These incentives include employee stock
options, profit sharing plans, paid time off,
bonuses and cash awards.
Additional monetary incentives include
annual or semi-annual bonuses, such as
mid-year and end-of-year rewards.
Monetary rewards motivate employees to
produce optimally.
 Non-Monetary rewards
Non-monetary incentives reward
employee performance through perks
and opportunities.
These rewards include flexible work
hours, training opportunities and the
ability to work independently.
The rewards and incentives are
valuable to an employee because they
allow workers to learn new skills and
pursue advancement opportunities.
 Types of incentives
Incentive:Any form of variable payment tied to
employee performance. The payment can be
tangible or intangible, and may or may not have
cash value. Incentives are generally non-
discretionary and can be paid at any time of the
year. Includes awards, rewards and recognition.
Award:Can be in the form of money, prizes,
plaques, travel and public commendations. The
payouts of sales contests are usually called
"awards".
Employee Engagement:An individual sense of
purpose and focused energy, evident to others in
their display of personal initiative, effort and
persistence directed toward organizational goals.
 Reward:An item given to an individual or team for
meeting a pre-determined goal.
Recognition:Display of appreciation for individual or
team efforts. Can be tangible or intangible, and range
from a thank-you email to travel.
Recognition Program:A policy of acknowledging
employee contributions after the fact, possibly without
predetermined, expected goals or performance levels.
Examples include giving employees clocks on milestone
anniversaries, granting an extra personal day for perfect
attendance, or paying a one-time cash bonus for making
a cost-saving suggestion.
Spot Award:A type of informal recognition that is
delivered spontaneously or "on the spot."
Total Rewards:The monetary and non-monetary returns
employees receive for their time, talents, efforts and
results. Deliberately includes all five key elements like :
compensation, benefits, work-life balance, performance
and recognition, and development opportunities.
 Limitations of rewards
Feeling of discrimination or dissatisfaction among
employees .
Affect Staff morale due to large difference in the
amount of reward being paid out to people doing
similar work.
Staff may become too focused on individually
earning those rewards/bonuses that they forget to
work in the best interests of the team as a whole.
There can be bias in evaluation required to
administer an incentive system or could end up
being too subjective rather than objective.
Some job roles may be supportive in nature (and
therefore may not attract as much rewards as other
roles such as sales). There must be a good balance
of incentives for these admin/support staff or else
they will not feel appreciated.
 Defining appropriate
Attraction and Retention: A reward system must
reward
systems
distribute rewards in a way that will lead the more valuable
employees to feel satisfied when they compare their rewards
with those received by individuals performing similar jobs in
other organizations.
Motivation of Performance: Important rewards must be
perceived to be tied in a timely fashion to effective
performance.
Skills and Knowledge Rewards must be skill based, which
allows organizations to strategically target the learning its
wants and engage employees to obtaining higher level jobs.
Culture - Reward systems have the ability to shape culture
precisely because of their important influence on
communication, motivation, satisfaction, and membership.
For example, they can influence the degree to which it is
seen as a human resources oriented culture, an
entrepreneurial culture, an innovative culture, a competence
based culture, a fair culture, and a participative culture.
Effective methods of reviewing
performance and development
1.Clarifying expectations and work
focus
What is expected form the worker?
What do others team members expect from the worker?
What are the work priorities for the organization from the
team?
What contribution will the worker make through his/her key
work tasks?
What are the workers career aspirations?
What goals are set for this work period to support these
aspirations?
What support and/or professional development is required to
build the capabilities to meet these expectations?
2. Reaching an agreement
Key work tasks responsible for
Capabilities required
Demonstrating work completion
Support for professional development
Developing capabilities for key work tasks
Career goals set for accomplishing during
the work period
 3. Performing and ongoing
support
Progressing with key work tasks and my
career goals
Development of capabilities towards
professional development
Supporting team members and receiving
feedback
Providing progress updates work
Dealing with new or competing issues or
priorities
Support by team leader and other team
members
4. Reviewing progress and
recognizing achievement
What are the key work tasks completed successfully?
What are the new learning's accomplished by
completing these key work tasks?
What are the strengths and how to build on them?
What areas need to be focused what improvements
can be made?
What are my career aspirations and what pathways
are available?
What are the supports and professional development
which need to be continued to develop
performance?
What to be done in the event of not meeting
performance expectations?
Assignments
1. What are the prerequisites of performance
planning?
2. How will you measure the behaviors in
performance management?
3. What are the various coaching styles?
4. Explain about the various characteristics of an
ideal performance management system.
5. What are the important points of consideration
for implementing performance management?
6. Discuss some paradoxical situations that
managers face while pursuing performance
objectives.
1. How do performance dimensions vary with
respect to nature of organization? Answer with
respect to one FMCG and one service sector
organization.
2. What are the various approaches for measuring
performance? Explain with examples.
3. What is the role of PMS in organizations?
4. What are performance dimensions? Give
suitable examples to support your answer.
5. What are the determinants in performance
management that allow some people to perform
at higher levels as compared to their peers?
6. Define and distinguish between
accountabilities, critical success factors and
dimensions with suitable examples.
What are the objectives of a good
developmental plan?
What are the different types of
performance dimensions? How is it
measured?
What are the advantage and disadvantage
of team rewards? Distinguish between
performance management and rewards.
Discuss the process of fixing rewards for
directors and executives.
List out non-financial rewards in Indian
companies.