Performance Management and Rewards

(Source: Medina, Dr. Roberto G. Human Behavior in Organization. Manila: Rex Book Store. 2011)

Performance management is the procedures and systems designed to improve employee

outputs and performance, often through the use of economic incentives systems. Other means to used
improve employee performance are goal setting, streamlined organizational structure, better
technology, new arrangements or working schedules, high involvement of employees and better
motivation of employees.

An effective performance management process considers human resource (HR) strategic

planning as a basic requirement. HR strategic planning is the process of providing capable and motivated
people to carry out the organization’s mission and strategy.

Staffing

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Effective performance begins with getting the right people, and then providing them with the

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right training and the right environment. Staffing refers to the HR planning, acquisition, and

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development aimed at providing the talent necessary for organizational success. The staffing process
consists:

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A. Job Analysis. The process of staffing starts with an understanding of the positions or jobs for
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which individuals are needed in the organization. Job analysis is a technical procedure used to
define the duties, responsibilities and accountabilities of a job.
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Results of job analysis are very useful in;

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1. Preparing for job descriptions

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2. Evaluating and classifying jobs

3. Training and career development
4. Performance appraisal
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5. Other HR aspects
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The job description contains information concerned with the job. The information includes job
duties and responsibilities, equipment and materials used, working conditions and hazards,
supervision, work schedules, standards of performance, and relationships to other jobs.
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To meet the job requirements specified in the job description, the job specification is derived. In
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a typical job specification, requirements about the following are indicated:

1. Education and experience

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2. Technical knowledge
3. Physical aptitudes and abilities
4. Interpersonal and communication skills
5. Analytical aptitudes and abilities
6. Creative abilities

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 B. Recruitment. It is a human resource management practice designed to locate and attract job
applicants for particular positions. This involves advertisement of a position vacancy, preliminary
contact with potential job candidates, and preliminary screening to obtain a pool of candidates.
Types of recruitment:
1. Internal Recruitment is a practice for attracting job applicants from those currently working
for the firm.
Advantages of internal recruitment:
 It is good public relations.
 It builds morale.
 It encourages good individuals who are ambitious.
 It improves the probability of a good selection, since information on the individual’s
performance is readily available.
 It is less costly than external recruitment.
 Those chosen internally already know the organization.

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 Promotion from within can also act as a training device for developing middle and top-

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level managers.

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Disadvantages of internal recruitment:

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
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It can be dysfunctional to the organization to utilize inferior internal sources only
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because they are there, when excellent candidates are available on the outside.
 It may generate infighting among the rival candidates for promotion.
 It may decrease the moral levels of those not selected.
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 It may promote “inbreeding”.

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Methods of internal recruitment

1. Computerized career progression system (CCPS) is one that stores extensive amounts of
information about employees of a company. It is a useful means of recruiting people
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currently employed by the organization. The system’s computer life contains information
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of employees such as job history, education, strengths and weaknesses, leadership

development needs, developmental needs, training, and special skills. The computer
may also provide information on job title, location, skills requirements, and potential
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successors to the position.

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The advantage of CCPS is that candidates can be found quickly. Candidates can be
identified and it will not be limited to candidates working in the department where the
vacancy exists.
The disadvantage of CCPS is that the skill inventory contained in the computer database
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is limited only to objective or factual information, such as educational degrees,

certifications, training courses taken, and languages spoken. Information of a more
subjective nature (like interpersonal skills, judgment, integrity) is excluded.

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 2. Supervisor recommendations. When a supervisor needs to fill a certain vacancy in his
unit, he is in the best position to identify the person who fits the job. He can be asked to
nominate those whose capabilities are well known to him.
Advantages:
 The supervisor is given total discretion in selecting the person who will report to
him.
 The supervisor is generally in good position to know the capabilities of potential
candidates.

Disadvantages:

 The supervisor’s recommendation is usually very subjective, and is thus susceptible

to bias and possible discrimination.
 Some qualified employees may be overlooked because the supervisor wants to help
his or her favourite, or he or she may simply be unaware of the capabilities

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possessed by some individuals.

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3. Job posting. A method of internal recruitment in which a job vacancy notice is posted

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and all qualified employees may bid. The notice describes the job, the salary, work

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schedule, and necessary qualifications.
Advantages:
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 It enhances the probability that the firm’s most qualified employees will be considered
for the job.
 It gives employees an opportunity to become more responsible for their own career
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development. Many may attempt to improve their job skills and performance because
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they perceive that such an effort can lead to greater promotional opportunities.
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 It enables employees to leave a bad work situation. In the same light, it encourages their
present supervisors to mange more effectively to discourage employees from leaving the
company.
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Disadvantages:
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 Takes time in filling vacant position

 The system may prevent supervisors from hiring the individuals they prefer. As a result,
the supervisors may resort to other moves to make sure that their favourites will get the
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jobs.
 Some employees may move from one job to another without any clear direction.
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 Employees who did not get the job may become alienated from the organization.
4. Career development system. The organization places “fast-track” or high potential
employees on career path where they are groomed for certain target jobs.
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Advantages:
 The top performers are more likely to remain with the company.
 It helps ensure that someone is always ready to fill apposition when it becomes vacant.

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 Disadvantages:
 An employee who is not selected even if he is good may become disenchanted and leave
the organization.
 The selected employee may become frustrated if the expected promotion does not
materialize because the targeted position never becomes vacant.
2. External Recruitment. It is a process of attracting job applicants from outside the
organization. It is under taken when no suitable candidates are available from within the
organization. This tends to bring in new blood and fresh ideas to the organization
Methods of External Recruitment:
 Employee referrals. Organizations ask their employees to solicit applications from
qualified friends and associates

Advantages:

 Applicants referred by employees tend to perform better ad remain with the

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organization longer than applicant’s recruited by other means.

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 Employees tend to be good recruiters because they know a lot about both the job being

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filled and the individual, and can therefore accurately judge the fit character to fall under

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the job requirement.
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Employees make good recruiters because believing their reputation is on the line, they
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are encouraged to refer only the highest qualified applicants.

The disadvantage is the limited choice offered to the organization. Employees will tend
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to recruit only those they know. Even of some are better qualified, they cannot be
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considered unless they are referred to by employees.

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 Applicant-initiated recruitment. Organization accepts unsolicited applications or

resumes from individuals interested in working for the organization.
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Advantages:
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 Both efficient and low cost

 Candidates are likely to be highly motivated, since they have taken the time to learn
about the organization
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The disadvantage is one which concerns timing. When applications and resumes remain
on file for some time, applicants may no longer be available when they are needed.
 Help-wanted advertisements. Organization laces an advertisement for the position
in the appropriate media such as newspaper, magazine and the like. The advantage
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is that, it allows the organization to reach a large audience in a relatively short

period of time. Its disadvantage is that, studies found out that people through
newspaper advertisements perform their job less efficiently and are absent from
work more often than those hired through other recruiting methods.

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  Private employment agencies and executive search firms. The hiring organization
initiates the recruitment process by contacting the appropriate agency or firm and
informing if the qualifications needed for the job in question. The agency or the firm
assumes the task of soliciting and screening applications, and then refers top
applicants to the hiring organization for further screening.
Private employment agencies are those that provide organizations, for a fee, with
clerical, blue collar, technical, and lower managerial personnel. Their services are
especially useful when many individuals are expected to apply for a job or when
qualified candidates are hard to find.
Executive search firms are employment agencies used to recruit middle and top level
managers. Those firms can locate successful executives working elsewhere who are
not even actively seeking new job.
 Campus recruiting. Organization’s recruiters visit various college and universities to
recruit individuals for position requiring a certain degree. The advantage of this

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method is that it can be used to fill specialized entry-level jobs in such fields. The

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disadvantage is that it is costly and time consuming.

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C. Selection. This involves choosing and assessing among job candidates.
Steps:

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a. Completing the application form
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b. Conducting an interview
c. Completing any necessary tests
d. Background investigation
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e. Physical and medical examination

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f. A decision to hire or not

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D. Socialization. It involves orienting new employees to the organization and its work units,
especially the work units where the newly hired employee will be working. The purpose is to
enable new employees to quickly become productive members of the organization. The new
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employees are provided with information:

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1. Key organization factors which includes an overview of the organization, policies and
procedures, compensation, benefits, safety and accident prevention, employee and union
relations, physical facilities, and economic factors.
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2. Department and job-related issues including department functions; job duties and
responsibilities; policies, rules, procedures, and regulations; the autonomy of the
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department; and socialization into the work group.

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