Professional Documents
Culture Documents
NAMIBIA
6-8 MARCH 2019
3-DAY, TRAINING
PROGRAMME
OVERVIEW
• Introduction and Background
• Performance
Management
• Key Performance
Areas (KPA’s)
• Key Performance
Indicators (KPI’s)
DEFINING PERFORMANCE MANAGEMENT
(PM)
• PM can be seen as a comprehensive management system aimed at constantly
improving and monitoring the performance of others.
❑ Jot this word down and find other learners who have written
down the same word.
• Group discussion:
1 2 3 4
Clarifying Setting of Action Planning Contracting
expectations goal/objectives, Performance
performance Agreements
standards and
criteria
PERFORMANCE
REVIEW/APPRAISAL
• Monitoring,
Measuring/Evaluati
ng performance
against the pre-
determined
performance
goals/objectives
and standards and
criteria.
PERFORMANCE
FEEDBACK/INTERVIEW
COUNSELING COACHING
CAUSES OF POOR
PERFORMANCE
❑#1: Skills/competence
❑#4: Organizational
factors
CAUSES OF POOR PERFORMANCE
❑ Resources
❑ Obstacles
❑ Skills
❑ Expectations
• Lack of Motivation
❑ No carrots
❑ No sticks
❑ Burnout
WHAT DO FOLLOWING COMPANIES HAVE IN
COMMON?
❑Accenture
❑Microsoft
❑Adobe
❑Deloitte
❑Medtronic
❑Gap
❑General Electric
• Reinventing Performance
Management at Deloitte
(HBR)
• https://hbr.org/video/512
2969232001/reinventing-
performance-
management
THE CHANGING FACE OF PMS
(COTTER, 2017)
• #1: RE-ENGINEERING THE ANNUAL REVIEW CYCLE
• As a Performance Management
Committee Member, extract and
apply the learning lessons from the
Reading Article, 7 Causes of Poor
Employee Performance - And How to
Address Them (Marr).
• As a Performance Management
Committee Member, measured
against the Deloitte video clip and
Cotter’s (2017) ten criteria, critically
evaluate your organization’s state of
readiness for the changing face of
performance.
PERFORMANCE
REWARD
• Offering of host of
customized and
personalized intrinsic and
extrinsic performance
reward options and
recognition.
• As a Performance Management
Committee Member, discuss the
key line management actions in the
following 4 stages:
❑ Performance planning
❑ Performance appraisal
❑ Performance feedback
❑ Performance reward
ORIGIN AND HISTORY OF THE BBS
• It was originated by Drs. Robert Kaplan & David Norton (Harvard Business
School) as a performance measurement framework that added strategic non-
financial performance measures to traditional financial metrics to give
managers and executives a more 'balanced' view of organizational
performance.
• These non-financial metrics are so valuable mainly because they predict future
financial performance rather than simply report what’s already happened.
• Their article (1996), describes how the balanced scorecard can help senior
managers systematically link current actions with tomorrow’s goals, focusing
on that place where, in the words of the authors, “the rubber meets the sky.”
• Given the insight and wisdom provided by Kaplan & Norton, the balanced
scorecard is a management system (not only a measurement system) that enables
organizations to clarify their vision and strategy and translate them into action.
• It provides feedback around both the internal business processes and external
outcomes in order to continuously improve strategic performance and results.
• When fully deployed, the balanced scorecard transforms strategic planning from
an academic exercise into the nerve center of an enterprise.
BBS MEASURES
BBS PERSPECTIVES/DIMENSIONS
• The balanced scorecard suggests that we view the
organization from four (4) perspectives, and to develop
metrics, collect data and analyze it relative to each of
these perspectives:
❑Customer
❑Financial
ILLUSTRATION: BSC
PERSPECTIVES/DIMENSIONS
AGREE OR DISAGREE?
WHY?
LEARNING, INNOVATION
AND GROWTH
PERSPECTIVE
• Strategic question:
• Value Outcome:
❖ Cycle time
❖ Unit cost
❖ Yield
❖ New product introductions
❖ Number of activities per function
❖ Duplicate activities across functions
❖ Process alignment (is the right process in the
right department?)
❖ Process bottlenecks
❖ Process automation
• Value Outcome:
❖ Efficiency
AGREE OR DISAGREE?
WHY?
CUSTOMER
PERSPECTIVE
• Strategic question:
• Value Outcome:
❖ Customer satisfaction
FINANCIAL PERSPECTIVE
• Strategic question:
❖ Cash flow
❖ Sales growth
❖ Operating income
❖ Return on Equity (RoE)
❖ Return On Investment (ROI)
❖ Return on Capital Employed (RoCE)
❖ Financial Results (Quarterly/Yearly)
• Value Outcome:
❖ Financial performance/profitability
PURPOSES OF THE BBS
• Articulate the business's vision and strategy
• Identify the performance categories that best link the business's vision and strategy to its
results (e.g., financial performance, operations, innovation, employee performance)
• Collect and analyze performance data and compare actual results with desired performance
• Group discussion
• As a Performance Management
Committee Member, by means of a
cost-benefit analysis, build a
business case for the strategic
utility and functional value of
Balanced Business Scorecards at
your organization.
• #6: BBS is a collaborative and partnering effort (managers have co-opted business
partners to the process)
• #7: BBS is integrated (with other business management and administrative) and
cohesive process
BEST PRACTICE GUIDELINES FOR BBS
• #8: BBS generates meaningful business intelligence which informs business
planning and supports strategic decision-making
• #9: BBS integrates both scientific (metrics and analytics) and artistic (planning)
principles
• #13: BBS incorporates strategic objectives into resource allocation processes e.g.
financing/budgeting
• #14: BBS is a logical and rational process making use of cause-effect logic
LEARNING ACTIVITY 5
• Individual diagnosis:
• As a Performance
Management Committee
Member, critically evaluate
your organization’s current
Balanced Business Scorecard
processes and systems against
the best practice criteria.
• Group discussion:
• Starting at high “strategic altitude”, Mission, Vision, and other planning elements
are translated into desired Strategic Results.
• Once the strategic thinking and necessary actions are determined, annual program
plans and projects can be developed and translated into budget requests.
ILLUSTRATION: HIERARCHY OF BALANCED
SCORECARD COMPONENTS
THE 9-STEP BSC BUILDING AND
IMPLEMENTING PROCESS
STEP 1: ASSESSMENT - INTERNAL AND
EXTERNAL STRATEGIC ASSESSMENT
• Step one of the scorecard building process starts with an assessment of the
organization’s Mission and Vision, challenges (pains), enablers and values.
• Tools:
❖ SWOT Analysis
❖ PESTEL Analysis
STEP 1: ASSESSMENT TOOLS
• CAPITALIZE ON STRENGTHS
• MINIMIZE/NEUTRALIZE WEAKNESSES
• EXPLOIT OPPORTUNITIES
• Group Discussion:
• They apply to every part of the organization and define what major strategic thrusts the
organization will pursue to achieve its vision.
• A strategic theme is an area in which your organization must excel in order to achieve your
vision.
• Themes also represent deliberate strategic directional decisions made by the leadership
team.
• Taken together, one can look at the proposed set of strategic themes and ask this question:
“If we excel in these 3-4 areas, will we achieve our vision?” and receive a resounding
answer of “Yes!”
• Each theme has a “strategic result” associated with it - this is a statement of a
desired end-state.
• The result is stated in such a way that you will clearly recognize success when
you see it.
• Examples include:
❖ Business Growth
❖ Operational Excellence
❖ Customer Service Excellence
❖ Innovation
STRATEGIC ❖ Sustainability
• The strategic differentiator lies in the strategic result - the specificity of the
RESULTS result gives guidance to organizational transformation.
• Group Discussion:
• Strategic Themes
• Group Discussion:
• Once all the theme maps are developed, they are combined to create a
powerful, mutually reinforcing business strategy.
• We are often asked “why” we go to all the trouble of building theme maps
when we are just going to combine them in the end. That is like asking why
we go to the trouble of installing the load-bearing walls when we are just
going to plaster over them and they’ll disappear into the woodwork
anyway.
STEP 4: STRATEGY MAP - CAUSE-EFFECT
LINKS
• In Step Four, the cause and effect linkages between the enterprise-wide
Strategic Objectives are formalized in an enterprise-wide Strategy Map.
• The previously constructed theme Strategy Maps are merged into an overall
enterprise-wide Strategy Map that shows how the organization creates
value for its customers and stakeholders.
• A Strategy Map highlights that delivering the right performance in the one
perspective (e.g. financial success) can only be achieved by delivering the
objectives in the other perspectives (e.g. delivering what customers want) -
basically creating a map of interlinked objectives
• Group Discussion:
• Group Discussion:
• Group Discussion:
• Group Discussion:
• Group Discussion:
• Kaplan, Robert S; Norton, D. P. (1996). The Balanced Scorecard: Translating Strategy into
Action. Boston, MA.: Harvard Business School Press. ISBN 978-0875846514
• Kaplan, R. S. and D. P. Norton. (1992). The balanced scorecard - Measures that drive
performance. Harvard Business Review (January-February): 71-79.
• http://balancedscorecard.org/Portals/0/PDF/BalancedScorecard9StepsToSuccess.pdf
(accessed 26 October 2014)
• https://www.slideshare.net/CharlesCotter/balanced-scorecard-41321389 (accessed 21
February 2019)
• https://www.slideshare.net/CharlesCotter/hrm-innovation-in-reinventing-performance-
management-and-compensation (accessed 21 February 2019)
• https://www.slideshare.net/CharlesCotter/performance-management-best-practice-
process-and-principles (accessed 21 February 2019)
CONCLUSION
• Key points
• Summary
• Questions
• Training Administration
• Certification