PERFORMANCE MANAGEMENT

INTERNAL ASSIGNMENT – SANA PATEL (E- MBA)

 1ST CASE STUDY

Rush Automobile ltd (RAL) was facing issues with its financial performance.
Therefore the company wanted to consider restructuring to turn the company
around. Even after all the efforts the company was still under the loss due to
high manufacturing cost and the price was not priced competitively. These
led to job cuts, selling unprofitable business and closing down many units.
RAL was finding it difficult to meet the growing competition. RAL realised that
in order to survive in the market the company needs to transform into a
flexible organisation and focus on sale and high value business. As one
measure of improvement the company introduced Balanced Scorecard. This
was used to communicate the strategy across RAL to more than 1 lakh
employees across its various units spread across the world. The Balanced
Scorecard enabled the employees to understand the existing policies and the
future plans of RAL. The management and all the division identified the
factors that were important to create value. Balanced Scorecard was also
used to measure corporate results.

Questions

1. What is Balanced Scorecard?

The balanced scorecard is a strategic planning and management system that

is used extensively in business and industry, government, and non-profit
organizations worldwide to align business activities to the vision and strategy
of the organization, improve internal and external communications, and
monitor organization performance against strategic goals.

2. What was the need for implementing Balanced Scorecard?

RAL was facing issues with its financial performance company was still under
the loss due to high manufacturing cost and the price was not priced
competitively. These led to job cuts, selling unprofitable business and closing
down many units. RAL was finding it difficult to meet the growing
competition

3. What was the benefit of Balanced Scorecard?

The Balanced Scorecard enabled the employees to understand the existing

policies and the future plans of RAL. The management and all the division
identified the factors that were important to create value. Balanced
Scorecard was also used to measure corporate results.
 2nd CASE STUDY

f the company follows this

new PM system, the result
will help to solve the
problem of previous
system. Described below:
o Communication:
Communication will be
improved, because
conversation will done in a
regular basis, where
employees can talking about
what’s important to them.
previously
they were ask
Solution Inc. was a leading Car manufacturing company. The company
earned an annual income of $5 trillion. It was one of the most successful
companies in the country. On 18th January, 2014 the company faced a loss
of $ 5 million when 2000 of their employee walked out the company.
Solution Inc. approached HR Solution Result Consultant (HSRC) to
investigate on the problem. After analysing the situation HSRC concluded
that indirect but rapidly destabilizing feature in team dynamics which needed
practical investigation and correction. HSRC invited a selected group of
leaders from Solution Inc. to attend 3 day workshop which was focused on
finding, identifying and correcting the destabilizing features in the team
dynamics. The workshop was planned using proprietary, fun but well-
provenance techniques for investigating these dynamics, the “survival
terrain” of work team at the plant. The workshop addressed how to tackle
complicated cultural instability. The workers returned to the company and a
similar event never occurred in the company. the confidence among the
employees increased.

Question

1. What do you understand by team building?

Team building is defined as “Philosophy of job design in which employees are
viewed as members of interdependent teams instead of as individual
workers” Individual employees are identified, united to form a team that
stays and works together to achieve the given task.

2. What was the problem faced by the Solution inc.?

The company’s problem was that indirect but rapidly destabilizing feature in
team dynamics.

3. What was the solution HSRC came up with? And what was the result?
HSRC conducted 3 day workshop which was focused on finding, identifying
and correcting the destabilizing features in the team dynamics. The workshop
was planned using proprietary, fun but well-provenance techniques for
investigating these dynamics, the “survival terrain” of work team at the
plant. The workshop addressed how to tackle complicated cultural instability.
As result the such event never occurred in the company. the confidence
among the employees increased.

3rd CASE STUDY

Candy Ltd was successful candy manufacturer. In the mid-1990’s the
company faced a problem its performance appraisal system. The system was
demotivation the employees than motivating them. Employees were
discouraged and disgruntled. Candy Ltd appraised its employees once in a
year. It required them to document their accomplishment and the managers
used to assess and assign rating. The rating was on forced distribution. This
system resulted in inequitable rating. The company came up with a new
system of performance appraisal the new system focused on appraising
employees half yearly and the numerical rating system was removed. Further
the company prohibited the appraisal guidelines of the use of subjective
assessments of performance. Both employee and the manager had to
prepare a written document on how well the employee met present
performance target. They meet and discuss the performance and provided
the feedback, improvements and resolving any differences between them.
The new system emphasized both the positive and negative aspects of
employee’s performance. The discussion was focused on the merits,
performance, and relationship with peers and position in salary range.

Questions
1. What is performance appraisal?
Performance Appraisal is the systematic evaluation of the performance of
employees and to understand the abilities of a person for further growth and
development. Performance appraisal is generally done in systematic ways
which are as follows:  The supervisors measure the pay of employees and
compare it with targets and plans.  The supervisor analyses the factors
behind work performances of employees.  The employers are in position to
guide the employees for a better performance. The main objective of
performance review for employees is to give them a feedback for their work,
record their work to give them a few organizational rewards and to provide
further development opportunities for their careers.

2. Give the meaning of old method of performance appraisal followed by

Candy Ltd?
Forced Distribution method This is a ranking technique where superiors are
required to allocate a certain percentage of rates to certain categories (e.g.:
good, above average, average) or percentiles (e.g.: top 10 percent, bottom
20 percent etc). Both the number of categories and percentage of employees
to be allotted to each category are a function of performance appraisal
design and format. The workers of outstanding merit may be placed at top
10 percent of the scale, the rest may be placed as 20 % good, 40 %
outstanding, 20 % fair and 10 % fair.
 3. What did the new system of PA emphasize on?
Under the new system both employee and the manager had to prepare a
written document on how well the employee met present performance
target. They meet and discuss the performance and provided the feedback,
improvements and resolving any differences between them. The new system
emphasized both the positive and negative aspects of employee’s
performance. The discussion was focused on the merits, performance, and
relationship with peers and position in salary range

4th CASE STUDY

Moonlight automobiles ltd. Primary is in the field of manufacture of two
wheelers. They manufacture and market mopeds. These are available in the
brand names 'arrow' and 'double arrow' where 'arrow' is their traditional
product and 'double arrow' is the improved version. The company was
started about 20 yrs ago. Their product 'arrow' enjoys a reasonably good
reputation and they were comfortable in the market. However, with the entry
of the new generation of fuel-efficient mopeds the company started losing its
market. They immediately started developing the improved 'double arrow'
but by the time they came out with this new model the competitors had
already strengthened their position in the market. The 'arrow' model was still
acceptable by a segment of the market as it was the cheapest vehicle.
'Double arrow' is a new generation vehicle. It was costlier than Jet but its
performance was much superior. It is compared favourably with the
competitors' products; however it was yet to gain a foot hold in the market.
The company had to refurbish the marketing activities in order to get back
their market share. They employed young sales engineers to launch a strong
sales drive. Mr. Ramesh Tiwari, Btech and a diploma holder in marketing got
selected and was put on the job. Mr. Ramesh Tiwari started well in his new
job. He was given a territory to contact the prospective customers and to
book the orders. The company had introduced a new financial assistance
scheme. Under this scheme, buyers were given easy loans. It was
particularly advantageous for group booking by employees working in an
organization. Mr. Ramesh Tiwari was able to contact people in different
organizations, arrange for group bookings and facilitate the loans. His
performance was good in the first year and in the second year of his service.
The company had its own system of rewarding those whose performance
happened to be good. They usually arranged a paid holiday trip for the good
performer along with his wife. Mr. Ramesh Tiwari was accordingly informed
by the marketing manager to go to Chennai with his wife on company
expenses. Mr. Ramesh Tiwari asked him as to how much it would cost to the
company. The marketing manager calculated and told him that it would cost
about 8000/-. He quickly asked him whether he could get that 8000/- in cash
instead of the trip as he had better plans. The marketing manager countered
this saying that it might not be possible to do so. It was not the trading of
the company, however he would check with the personnel manager. After a
couple of days, Mr. Tiwari was informed that it would not be possible to give
him a cash reward. Mr. Tiwari grudgingly went for the trip and returned. On
his return, he was heard complaining to one of his colleagues his little
daughter was also along with him. The marketing manager and the personnel
manager thought he was a bit too fussy about the money and some of his
colleagues also thought so. During the subsequent days Mr Ramesh Tiwari's
performance was not all that satisfactory which showed his lukewarm
attitude towards his job and the subordinates.
Questions.
1. Where did the things go wrong?
The company’s reward system went wrong because as per the company’s
rule arranged for paid holiday only the employee and their spouse and it was
not applicable for the employees children. So therefore the employees as to
shell out money from their own pocket if they had to take their kids along
with them.
2. Was Mr. Ramesh Tiwari too much money minded?
No I don’t think Mr. Ramesh Tiwari was money minded. He had asked for
cash instead of the trip because the company only sponsored trip for this
wife and not his little daughter.

3. Was the company too bureaucratic?

Yes the company was bureaucratic because they didn’t wanted do consider
the options of their employees nor asked about the reason as to why Mr.
Ramesh Tiwari was asking cash instead of trip.

4. Did the personnel manager handle the issue properly?

According to me the personal manager had not handled the situation. When
they heard complaining to one of his colleagues his little daughter was also
along with him. They should have called him as sorted out the issue. Should
have asked Ramesh what made him so fussy about the trip.

5. What is your recommendation to avoid such situations in future?

I would suggest the company to pay a monetary benefit as reward than the
holiday trip. If the company still wants to follow their existing system then
the company need to extended to the employees children’s too.