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Performance Management System

Name: Syed Muhammad Asim Student No: TP018321 Assignment title: Individual Assignment Module code: BM036-3.5-3-Managing People and Performance Hand in Date: 5th April 2011 Lecturer¶s name: Anita Premila Paul

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Performance Management System Contents
1.0 Introduction .......................................................................................................................... 3 2.0 Performance Management at Procter and Gamble ................................................................. 3 2.1 Implications of Performance Management System at P&G ................................................ 4 3.0 Performance Management at Dell computers ........................................................................ 5 3.1 Implication of Performance Management system at Dell ................................................... 6 4.0 Comparison of Performance Management System at P&G and Dell ...................................... 7 4.1 Similarities ........................................................................................................................ 7 4.2 Differences ........................................................................................................................ 7 5.0 Recommendation .................................................................................................................. 8 6.0 Conclusion ............................................................................................................................ 8 7.0 References ............................................................................................................................ 9 7.1 Books................................................................................................................................. 9 7.2 Magazines and Articles...................................................................................................... 9 7.3 Websites .......................................................................................................................... 10

Word Count = 2170 words only

Question:
³Critically discuss the extent to which the emergence of performance management system has become
a strategy to managing employee contribution for organizational effectiveness´.

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1.0 Introduction
Performance management is an ongoing communication between the manager & each employee to clarify job responsibilities and improve performance continuously (Bacal, 1999). In 1976, the tern performance management had been coined by Beer and Ruh, and its concept had become one of the most important developments in the field of human resource management. Performance management is the strategic and integrated processes that help to deliver as well as maintain the success of the organization by improving performance of the employees as well as by developing the abilities and skills of each and every individual in order to create a wellestablished team (Armstrong, 2000) Performance management system importance is vital and crucial for organization success as the world has revolved much, with the power shifting to the customers as their expectations are higher than before and getting higher day by day, a competent and motivated workforce is able to deliver such a performance which will meet the expectation of the customers and make them loyal to organization which is most important to organization success as the competition in this era has surpassed that of past. Moreover for the edge over competitors, Performance Management tools like empowerment, self evaluation questions, development planning, performance planning, coaching and feedback have to be used effectively to manage employees and enhance their participation in order for organization to perform to its maximum potential and achieve the organization goal.

2.0 Performance Management at Procter and Gamble
In Procter & Gamble, in order to maintain the standard of their human resource, the senior vice president of the HR is responsible in personally overseeing the annual diversity reviews with the director of the diversity as well as the top management of each and every function and business units in order to help develop and improve the next generation of their leaders. The accountability for the diversity is incorporated in the performance reviews that are available in all of the levels of the organization (Digh, 1998).
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Moreover, the performance review of the employees is based on different factors like the ability of the employees to respect as well as to work in effective manner with the diverse people (Digh, 1998) The supervisors are also included in the review, where in it will be based on their ability to develop people regardless of their sex and age (Digh, 1998). The said strategy or performance management program is being done in order to make sure that each and every employee is working according to the standard of the company that will help to improve their performance in the market. In addition to that, it is also done in order to see the human resource of the company as a credible function and a highly influential factor or aspect in the company (Gandossy and Kao, 2004). Procter & Gamble also has gathered different feedback from the students of the company and then used the data and information from the said feedbacks in order to make some of the adjustments to the work experience program based on the suggestions of the students. The program gave benefits to both the company as well as the individual it is due to the fact that during the said program the company had been able to assess if an individual is a good fit for the company. On the other hand, the student gains first-hand information experience that will help them to improve and develop their skills (National Council for Work Experience 2008) Salaries at P&G are certainly very competitive and employee can expect to be rewarded highly if his or her performance is good. Later evolutions of employee compensation and career will be dependent on regular appraisals: P&G "Growing from within" philosophy ensures that your career will develop in the direction that suits you best, based on your performance alone. (PGcareers, 2011)

2.1 Implications of Performance Management System at P&G
Having such an appealing performance management is one of the strengths of P&G, which sets them apart from their competitors; having such a performance management system shows that P&G is Valuing People- This is about appreciating the efforts and contribution of employees and giving them due recognition. It¶s about understanding the importance of employees in the company¶s success. In such a industry of Fast Moving Consumer Goods, valuing the employees work and working towards their career development ensures employees dedication and loyalty
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towards company, this furthermore leads to Involving People- P&G has a balanced Performance management scheme which believes in collaboration between employees and employers to ensure both sides work together in unison; proper co-operation and co-ordination between the management and employees. It believes in empowering people, giving importance to their opinion and suggestions, and a participative decision making process. This can only happen if the organization¶s culture is benevolent and people oriented which helps them achieve organizational goals, hence Performance management system can be looked upon as an effective strategy to achieve company mission and vision. Furthermore, performance management system at P&G ensures smooth relations between employee and employers, leading to employees being more efficient at workplace and able to work up to their potential. Impact of the performance management process of Procter & Gamble has helped them to create good working environment and ambience.

3.0 Performance Management at Dell computers
Dell¶s continued success relies on teamwork and the opportunity each employee has to learn and excel. Dell winning culture mandates that Dell invest in people, value learning and remain endlessly curious. Dell is committed to being a meritocracy and to developing, retaining and attracting the best people, reflective of our marketplace. (Dell 2011) Dell¶s performance management system links individual goals with organizational performance. The system helps identify the next generation of Dell leaders and elevate the performance of all Dell employees. (Dell 2011) The performance management process requires annual formal reviews, the calibration of talent and allocation of performance rewards and promotions ² all decisions in line with being a meritocracy. Throughout the year, managers provide employees with ongoing feedback, coaching, training and on-the-job development. Employees and managers mutually create the employee-development plans. (Dell 2011) This entire process aligns individual-performance objectives and career-development planning with business and company goals and results. This plan evolves over time, adjusting to internal and external changes. (Dell 2011)
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Dell creates learning experiences that draw from multiple approaches and styles. We value onthe-job experience and assignments, and we also offer networking, coaching, mentoring and formal learning programs. Dell offer tuition reimbursement for employees and scholarship opportunities for the children of Dell¶s U.S. employees. (Dell 2011)

3.1 Implication of Performance Management system at Dell
Having such an effective performance management system has allowed Dell to experience huge market share and gain employee loyalty, which is crucial for their success in today¶s world, and even to prosper in future and enjoy the market leader position by realizing in what ways and how employee can contribute to organizational goal and then giving them roles as per their qualifications. Dell Performance Management System revolves around Developing People- This is the most crucial part of performance management at Dell. Performance appraisal is used to highlight the strengths and weaknesses of an individual so that a proper personal development plan can be prepared for an employee. Hence nurturing and developing talent within the organization. However it¶s more than just development of individuals through training. It¶s a well thought out plan for knowledge management and organizational learning to improve the competitiveness of the entire workforce is what separates the great companies from their competitors and that¶s why Dell has been so successful over the years, having continuous learning environment in organization has enabled every individual to develop and their goals are designed to meet the organizations overall goal hence Performance Management System at Dell is able to boost the employee performance to meet the overall organizational goal. Senge, et al. 1999) remarks: ³The rate at which organizations learn may become the only sustainable source of competitive advantage.´ The only way to stay competitive is to be better than the rest through continuous improvement, innovation & creativity which is incorporated in Performance Management System at Dell. Benefits which Dell provides to their employees is exceptionally appealing and motivating, such as giving scholarship opportunities to the children of Dell employees at U.S. overall such a strong yet effective Performance Management System has contributed most to the winning culture of Dell.

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4.0 Comparison of Performance Management System at P&G and Dell
Due to the difference in nature of the industries many practices are different yet the overall objective is same and the getting the desired results the input of Performance Management System is similar.

4.1 Similarities
Enhancing the ability of the employees to work efficiently and effectively to meet the organizational goal, where by developing the employee skills and giving appropriate training for it, Involvement of people at the both the organizations have been constant and very well managed, through which the employees can excel their performance and achieve their individual goals and at the same time are able to achieve the overall organizational goals, rewarding the employees and recognizing their work through giving them rewards and benefits has been the norms of both the organizations, which has enabled them to have the motivated and dedicated workforce. Dell and P&G have been able to successfully use most of the tools of Performance Management System effectively like development planning, performance planning, giving feedbacks to employees and coaching. Both the organizations have been successful in using the performance management system as a strategy for managing employee contribution towards organizational success.

4.2 Differences
Whereas Dell focus on linking individual goal to the organizational goal, P&G has focused more on the organizational goal being given more priority then the individual goal, at P&G Performance Management System is used more as a strategy to make sure employee is working as per standard of company in order to improve P&G performance in the market place, whereas Dell employees and managers mutually create employee development plan. P&G benefits are much more focused on performance, the better an employee perform the more rewards and benefits he or she would receive whereas Dell Performance Management System has looked more into employee career development and employee skills development compared to having standardized regulations for employees to follow in order to feel satisfied and motivated.

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5.0 Recommendation
P&G and Dell should have even more Specific, Measurable, Attainable, Realistic and Timely Goals for employee, generous but at the same time being professional at evaluating employee performance, recommending highly competitive compensation plans, managing employee trainings and development and promoting right employees to critical positions. P&G should look more towards the approach of mutual concerns, and focusing just on Performance alone is to rigid a criteria for giving rewards to employee could make it more lenient by giving employee targets which if 80% met also are accountable for certain benefits just to keep their motivation high, else the employee will only be focused on performing and the quality of work might be affected. P&G and Dell both should be engaged in the process of 360 degree appraisal systems which is a systematic collection and feedback performance data on an individual or group, well the main benefit that would be derived from a 360 degree appraisal system would be a clear way designed to promote understanding between employee and employer in a more authentic and appealing way. Energizing the involvement of employees in decision making by making their feedback countable, usage of technology employee could have live chats with C.E.O perhaps and send his suggestion on how to improve a certain thing and make it more profitable, this would feel employee that his performance is recognized in organization he would feel trusted yet motivated and would give his maximum to show his loyalty towards organization making it more successful and prosperous. P&G and Dell should also be concerned about managing bottom performers, preparing robust 30 to 90 days performance improvement plan including specific and measurable actions with clear timelines along with guiding principles on how to improve performance a strict yet helpful close supervision within this period of time by supervisors would be highly influential and beneficial for the growth of employee.

6.0 Conclusion
P&G and Dell both are renowned companies in today¶s world in their respective industries and have gained much popularity over the years for the quality goods and services they offer. Performance Management System at both the companies has its advantages and top management of both the companies are aware that the biggest room in this world is the room for improvement and hence they should work towards improving even further and having more ways to boost
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employee performance, since it¶s the employee participation and contribution in the workplace which leads to greater organizational performance and determines companies success. On the balance it can be concluded that the emergence of Performance Management System has been a great help to the organization in getting the best out of their employees to achieve the greater success for organization and has act more of a blessing for organizations than a curse.

7.0 References
7.1 Books
Armstrong, M., 2000. Performance Management: Key Strategies and Practical Guidelines, 2nd ed, USA: Kogan page Bacal, R., 1999, Performance Management, USA: McGraw-Hill Professional Senge, P., Kleiner, A., Roberts, C., Ross, R., Roth, G. and Smith, B. (1999) The Dance of Change: The Challenges of Sustaining Momentum in Learning Organizations, New York: Doubleday

7.2 Magazines and Articles 
Beer, M., Ruh, RA., 1976, Employee growth performance management. Harvard Business Review, July-august, pp-59-66  Digh, P., 1998, The Next Challenge: Holding People Accountable, HR Magazine Society for Human Resources Management, [online] Available at: www.realwork.com/aricles.asp?filename=holdingpeople.htm [Accessed on 27th March 2011]  Gandossy, R & Kao, T., 2004, Talent wars: Out of mind, Out of practice, Human Resource Planning, vol. 27, no 4, pp. 15-23  National Council for Work Experience 2008, Work Experience, HR Circles, [online] Available at: http://www.changeboard.com/hrcircles/blogs/hr_best_peactice/archive/2008/03/13/workexperience-procter-amp-gamble.aspx [Accessed on 21st March 2011]

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a. Dell, 2011. Workforce Commitment. [online] Available at: http://content.dell.com/us/en/corp/d/corp-comm/cr-diversity-wf-talent-mgmt.aspx [Accessed on 18th March 2011] b. Pgcareers, 2011. Benefits at P&G. [online] Available at: http://www.pgcareers.com/aboutpg/whyjoin/benefits/page/88/default.htm [Accessed on 24th March 2011]

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