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Memorandum

To Regional Human Resources Director, Lowes Home Centers, Inc. From: Human Resources Manager, Lowes Home Centers, Inc. CC Senior Vice President Store Operations, Lowes Home Centers, Inc. Subject: Proposal for implementation of new Performance Management System in Region 3 with Lowes Home Centers, Inc. Thank you for reviewing and accepting my request for research regarding a new Performance Management System for implementation in region three for Lowes Home Centers, Inc. Please find my proposal below for implementation of a new Performance Management system to be utilized by Lowes Home Centers, specifically the Atlanta, GA region, region three. Performance management in the work place is vital and can ultimately make or break a company. Consistency is one way to ensure that a company is treating each of its employees the same and not signaling out employees to reprimand. Research shows that having a strong and consistent performance management system in place helps companies to grow and develop its employees while maintaining discipline throughout the company for employees who fail to follow company policy and procedures. Consistent performance management can help to develop strong employee morale in its stores and create more profit for the location.

Performance Management in the Workplace


Lowes Home Centers, Inc. Region Three

Executive Summary
Lowes Home Centers, Inc., region three, located in Atlanta, Georgia consists of over 100 stores and has thousands of employees and hundreds of managers. The employees and managers alike have policies and procedures to abide by and with policies and procedures come performance management systems that are greatly needed to be successful. Performance management systems are vital to all organizations and can help managers within a company to effectively set and communicate goals, evaluate the employees performance and reward or reprimand accordingly. All managers within a company need to understand and comply with the performance management system put in place by the company itself. More and more managers are depending on the Human Resources Manager to handle all the performance issues throughout the store with Lowes instead of handling issues on their own. When Assistant Store Managers work side by side the employees on a daily basis, the responsibility of performance management should shift to them versus the Human Resources Manager.

While the Human Resource Manager needs to play a vital role in the performance management process, it cannot be solely their responsibility. Managers within each location need to collaborate with one another to determine how to implement goals and how to performance manage each employee. How will it work best for their location?? Through creating and implementing a new performance management system, more consistency would take place within the company and employees would feel as though less favoritism is taking place where recognition or reprimands are taking place. Consistent practices can prove to hold rewards for the company including increased employee morale, higher profit margins and better customer satisfaction.

Introduction
What is performance management? Performance management is the systematic process by which an agency involves its employees, as individuals and members of a group, in improving organizational effectiveness in the accomplishment of agency mission and goals. (Performance Management) In the workplace, Lowes management team needs to have consistent practices when dealing with employees. A strong performance management system will help the company, its managers and employees succeed. Working in a location with over 100 employees comes 100 different personalities and learning styles. Just as one would have to adjust to different training styles in order for employees to understand the job they were hired to do, the performance management systems requires the same type of adjustments. When a manager plans and sets goals for employees the goals cannot be the same for each employee. Setting goals and planning is the first step to a successful performance management system. Setting realistic SMART goals and ensuring that employees understand what these goals

are is very important. The goals can help determine the employees growth with the company. SMART goals are meant to be specific, measurable, achievable, relevant and timely. (Performance ManagementThe Key to Outperforming Your Competition) Once goals are set then the managers need to monitor the performance of each employee. While monitoring employees performance at Lowes, managers need to be consistent in the practices they use to ensure all employees are receiving the same amount of monitoring and feedback. Being inconsistent in managing each employees performance can cause managers to open Lowes up for lawsuits, which can be harmful to more than just the company can but to the manager who caused the conflict, whom can be sued personally depending on the situation surrounding the circumstance. Managing the performance of the employees includes giving both positive and negative feedback to the employees and ensuring they understand what they are doing right and wrong before they continue with the same behavior. During the monitoring process the managers should actively be providing feedback to the employees so that when the employees review comes up no shocking revelations are revealed. Often times employees feel as though they are doing an okay job and then when they receive their review they find out that they are underperforming. This is due to a poor performance management process and lack of communication. Managers should sit down with employees and review their performance more than once a year when an annual review comes along. An employee should be recognized for doing a good job as well as for doing a poor job. If an employee is not successfully completing the goals set by the manager initially but are not informed about it during the managing process then the manager cannot just automatically give the employee a bad review. Being consistent in their practices and openly speaking with their employees throughout a work year will better help the employees understand what they need to change about their behavior and what they need to continue doing in order to succeed in their position. Once the manager has planned and set goals with employees, managed the employees performance and consistently reviewed each employees performance with them then the reward process would take effect. The award process can vary by company but many see this as the annual raise companies strive to give employees for their hard work throughout the previous year. Setting these increases has a lot to do with how the employee performed and what type of performance management was used in developing the employee. However, raises are not the only reward one can receive after a performance management review. Some employees work hard and are determined to not stay in one position while working with Lowes Home Centers and when they do well at their job and get high ratings on their reviews then it proves to be a deciding factor in whether or not an employee gets a promotion. An underperforming employee

who has not met the goals set would not have the same chance to promote and grow within the company. Assistant Store Manager, Kevin Allen, stated I have been with Lowes for 15 years and have been in both the position of manager and employee. Having seen both roles I know and understand the importance of consistency with the management team and how it affects the employees. Employees feel picked on at times if a manager is only getting on to them about their performance when it seems as though no one else is being spoken too. I personally sit down with all my employees once a quarter to speak about their performance whether it is negative or positive. However, if need be I will give commendations or write ups in between the sit down conversations to ensure each employee is aware of their performance. (Allen, 2012) Mr. Allen gave some valid points during his interview and with him being a manager within a store location in region three these points can be taken and implemented into other areas of the region.

Performance Management Diagram

Recommendations
My recommendations for region three with Lowes Home Centers, Inc is to develop and implement a new performance management system based on the above guidelines. The current

policy in place is not being utilized consistently throughout the locations within the region and has caused some conflict between stores regarding reprimands that have taken place. If an employee fails to complete a goal set by its manager then documentation needs to take place for everyone who fails. Not just one employee who the manager may not like as much as others. Goals set by the company do not have to be difficult ones. For instance, each employee can have the a goal set to be at work and on time for all scheduled shifts then if an employee fails to show up for work then the documentation process can begin for each employee. Based on research conducted, having a successful performance management system in place at all stores in region three with Lowes will help lower the regions risk of employment lawsuits regarding unfair practices. The above guidelines can help the managers train and understand what is expected of each of them as well as each of their employees. All managers need to consider each employees strengths and weaknesses when setting the goals based one Lowes policies and procedures. If all managers are consistent to the above guidelines and represent the company to its fullest by abiding by all policies and procedures then the new performance management system will be a success and the company would run more smoothly.

Conclusion
Managing employee performance is not a difficult concept, just one that has to be monitored. Being consistent is the most challenging aspect of having a successful performance management

system. Treating each employee the same, giving each one goal and monitoring those goals equally and rewarding or reprimanding accordingly can lead to a happier employee and workplace. Overall, employee morale is based on the way they are managed. If an employee is poorly managed then most likely the morale of the location will suffer. Poor morale within a location can lead to poor customer service and then ultimately lower sales and margin for the store. Therefore, having a new performance management system in place in which to help managers stay consistent is vital. Planning and setting goals based on Lowes policies and procedures would be easy for a manager to do if they are focused and engaged themselves. Managing the employees would be the most difficult part because of having to be consistent and that seems to be the issue when managers are utilizing performance management. (Savage, 2012) Once the performance of each employee is managed, then reviewing each employee performance should be easy. Review the employees performance as you witness positives and negative. Waiting until it is time for a formal review would not be fair to the employee and can cause undue stress for the employee. Review throughout the year and document as necessary for each goal not completed by the employee. After the above, three steps then rewarding the employees for their hard work is great. Giving annual raises or giving promotions to employees who prove able to be performance managed will help the company maintain its standards and reduce its risk of lawsuits.

References
Performance Management. (n.d). Retrieve November 16, 2012, from U.S. Office of Personnel Management: http://www.opm.gov/perform/overview.asp Performance ManagementThe Key to Outperforming Your Competition. (n.d) Retrieved November 2, 2012 from Success Factors http://www.successfactors.com/articles/automate-performance-management/smb/.

Price, D. (n.d) Using Performance Appraisals to Enhance Employee Performance. Retrieved November 2, 2012, from Business Perform http://www.businessperform.com/articles/performancemanagement/using_performance_appraisals.html.