MODERN PERFORMANCE MANAGEMENT

AND ITS CHANGING TRENDS

Performance Management - A
Experiential Learning Project

Batch 2020-23

Submitted to: Prof. Seema Mathew

Submitted by:

Arshia Kapoor- 3418

Wamika Rawal 3496

 Index

S. No Title
1.
Acknowledgment

2.
Executive Summary

3.
Introduction

4.
Literature Review

5.
Start-up Interview

6.
Findings

7.
Conclusion

8.
References
 ACKNOWLEDGEMENT
Firstly, we would like to thank our college for giving us a great opportunity to work on this
research project. This project has taken us on an amazing journey through which we have
improved our knowledge and skills.

Secondly, we would like to give thanks to our mentor, Prof. Seema Mathew, who has been a
great supporter and guide throughout this journey of making this project a success. From day
one, she was there to help us and to clear all the queries. She has motivated us at every step and
her suggestions were very fruitful. Her efforts have helped us a lot in improving the quality of
our research work. This was a highly enriching experience and all of us learned a lot.

We would also like to express our gratitude to the director of our institution, Symbiosis Centre of
Management Studies Pune, Dr. Adya Sharma, for giving us such a wonderful opportunity to
attempt this and for providing us with additional assistance through our professors and providing
us with study material throughout the course of completion of this project.
Executive Summary
Performance management is a technique used in corporate management to assist managers in
keeping track of and assessing employees' output. Performance management is to create an
environment where employees may work to their full potential and produce the best quality work
possible quickly and effectively.

Our operational practices are evolving. The majority of workers today are members of the
millennial generation, technological advancements have transformed the way we do business,
and because it is 2022, the future has already arrived. Flying cars or robots are not covered in this
article; we are only talking about performance management trends. In the previous ten years,
performance management has changed quite a bit.

It was observed that the startups offer their employee assessments and evaluations more of a
personal touch than the MNC does. In contrast to the small business owners, who claim that they
review the daily personnel of their employees based on a variety of characteristics, the MNC, for
example, have a user interface designed especially for this reason.

Additionally, it was mentioned that for small organisations, the creative aspect of the job was
significant when it came to the crucial components of good performance management.
Therefore, after researching we found out that the MNC emphasis more on maintaining
meticulous records and avoiding bias.
Introduction
The employee is evaluated for performance after being chosen, trained, and motivated. When an
individual performs, management can assess how successful it was in recruiting and deploying
them. When issues are found, actions are taken to speak with the staff about them and find
solutions. A "performance appraisal" is a procedure for assessing how well an individual
performed their duties in accordance with the job's requirements.

Performance Management includes all organisational processes that affect how successfully
teams, individuals, and ultimately the organisation perform.. Performance management entails
the following steps:

1. HR planning;

2. Employee recruitment and selection;

3. Training and development;

4. Career planning and development; and

5. Compensation.

Performance management is an integrated process that combines goal-setting, performance

evaluation, and development into a single common framework. It also includes performance
planning, appraisal, feedback, and counselling. A system like this is designed to make sure that
employee performance is assisting the strategic goal of the business.

Performance management is a systematic procedure that involves organising work and

establishing expectations, monitoring performance constantly, building performance capacity,
assisting with the "How" aspect of performance, reviewing performance sometimes, and
rewarding desired performance.

Under the project we have tried to cover by understanding the current trends of performance
management, about start up and MNC in order to have a better understanding of performance
management in different types of organizations like PWC. The project helped us understand how
performance management for outsourced employees is done in case of a start up and also gave us
an understanding how an HR portal eases the process of performance management on both
senior and subordinates ends.
Literature Review
1. Current trends in Performance Management:
Global companies are functioning in a difficult environment. Today, a company must compete in
more markets, use more platforms, and manage more stakeholders than ever before in order to be
profitable and ahead of its competitors. The emergence of new issues including the dynamic
talent, technological, and economic environments further highlights the complexity of the
modern business environment.

Performance management has remained a static practice for the past forty years, mostly
consisting of an annual review. Performance management is currently one of the most important
instruments that executives, line managers, and employees may utilise to accomplish their shared
objectives.Software that gives management a means of achieving its operational and strategic
objectives has made it possible to transform how Performance Management is applied.

Emerging Trends in Performance Management:

i) Annual review sessions

These sessions are being replaced by frequent check-in meetings between managers and staff at a
number of top organisations, including Adobe, Microsoft, Accenture, and Deloitte. These
one-on-one sessions enable managers to frequently monitor progress and continuously revise
personal development plans in line with this.

ii) Objectives and Business Goals Alignment

Anyone working in performance related HR will be familiar with the concept of SMART
objectives
The term "SMART objectives" refers to an abbreviation that is used to
Specify, measure, achieve, relevant, timely, and time-bound objectives.

iii) Rank and Yank Technique

The Rank and Yank Strategy, commonly known as the "Up or Out Policy," was implemented at
General Electric under CEO Jack Welch. It is a performance appraisal approach where
best-to-worst ranking techniques are utilised. Employees of the organisation compete against one
another, and the corporation fires the lowest performer. Finding and distinguishing the poor
performers from the good performers is the first step in the process. This tactic will aid the
business in better understanding hiring, talent retention, and downsizing.
iv) 360° evaluation
The term "multi-rater feedback," which was first used in the 1940s, is also referred to as
"360-degree feedback."The primary goal of assessing an individual's performance in an
organisation is to assist the employee in receiving private, unattested feedback from those who
work nearby.An employee self-assessment form and a feedback form are often filled out by a
chosen group of employees in the organisation. Through these forms, the employee can better
understand his or her strengths and limitations. Four parameters make up multi-rater feedback:
peer evaluation, superior evaluation, subordinate evaluation, and self evaluation.

v) 720° feedback
In this approach, the evaluation is conducted by both groups outside the organisation and
stakeholders within the business. Customers, investors, suppliers, and other financial institutions
are among the external organisations that evaluate an employee's performance. In this technique,
we offer comments following the primary/original 360-degree evaluation. This is only done in
rare circumstances. Some managers believe that the success of an appraisal depends on a
methodical process for gauging progress and receiving feedback. Pre- and post-intervention data
are provided here.

vi) Social media's Impact is Growing

In order to make software as user-friendly as feasible, social media interfaces will be
incorporated into software design in the future. Real-time software will be created to provide
constant feedback and frequent updates between management and employees.

vii) More Scrutiny on Gender Bias in Performance Management

In the technology sector, 58.9% of performance reports for males contain constructive criticism,
while 87.9% of reviews for women. They can anticipate a greater emphasis on maintaining
impartiality in future performance reviews as a result. Giving managers training on best practices
for drafting performance reviews and making sure they always adopt a forward-looking
perspective are two ways this might be addressed.

viii) Continuous Coaching

Over the past five years, both the public and commercial sectors have placed more emphasis on
performance management than on performance appraisal, changing the role of the performance
appraiser into that of the performance coach. From a discrete activity to one that is carried out on
an ongoing process is the shift. The change is from primarily being an evaluator to becoming a
person's developer.
 2. Performance Management in MNCs
The study primarily investigates how the country managers of the subsidiaries of multinational
businesses perceive the global performance management process.The study shows that a
multinational corporation's systemic need for quick cash has the ability to hinder
employee-supervisor relationships, and that a person's perception of how well performance
management is working depends on how well they get along with their boss and how much they
trust them.

The study also helped us to understand how most of these companies have a separate portal for
HR related activities under which performance management falls too. The performance
management in these companies is not only based on the current performance but also involves
future aspirations of the employee in order to award him/her with performance appraisal. The
companies consider CDP( career development plan), performance and also capability of the
employee in order to consider the performance management process. Companies take into
account CDPs (career development plans), performance, and personnel capabilities when
deciding how to handle performance issues.

Performance Management by PWC India

In this study we found out that the problem with performance management in India is that
procedure compliance has become more important than the goals and results it is supposed to
provide. Additionally, the yearly or periodic performance appraisal procedure is typically the
only evaluation that the performance management system can handle.

A high performance culture requires investing time and effort in skill development and
promoting ethical workplace conduct. Employees must actively seek feedback to promote their
development, both short- and long-term, and managers play a crucial role in fostering an
atmosphere that supports high performance.

Their survey revealed that-

● Only 12% of the respondents believed that their current performance management system
is highly effective in achieving its stated purpose
● 93% of the respondents indicating that ‘supporting the business objectives’ is the primary
purpose of performance management systems
● More than half (52%) of the respondents surveyed have made changes or are planning to
make changes to their existing performance management system.
● Only 16% have done away with individual ratings, the intent to make systemic changes
indicates that bold approaches to performance evaluation and management will be
witnessed in the near future
 3. Performance Management in Start-up-
The development and use of a Dynamic Performance Management (DPM) strategy for assessing
and promoting SME competitiveness is demonstrated in this study. The emerging paradigm is
applied to a real-world case study of a small corporation to evaluate the empirical effectiveness
of the suggested technique.

The Balanced Scorecard (BSC), a tool for strategic management and performance evaluation,
appears to be suitable for use by companies of all sizes and forms. The key benefit of the BSC
for most businesses is its inherent ability to mix financial and non-financial data by assessing
business and strategy performance from four interrelated angles.

A study of the literature on performance measurement in manufacturing SMEs is carried out,

analysing the prevalence, characteristics, and motivators of performance measurement in SMEs.
The shortcomings of performance measurement systems are emphasised, and the numerous
factors that seem to prevent the implementation of PMS in manufacturing SMEs are listed. These
factors include a lack of human and financial resources, a misunderstanding of the benefits of
implementing a PMS, and short-term strategic planning. In addition, two PMS models developed
specifically for SMEs are compared to generic PMS models that use dimensions defined in line
with the information presented in the literature. In particular, models developed in the previous
20 years have been more horizontal, process-oriented, and stakeholder-focused, as seen by the
comparison, which shows how PMS models have changed over time.

However, it is unclear if these modifications are the consequence of the development of general
models or an effort to provide models that are specifically designed to meet the needs of SMEs.
To clarify this matter and comprehend PMSs in SMEs, additional theoretical and empirical study
is needed.

How is performance management of MNC different from a START- UP?

The primary distinctions that stood out to us was that the senior manager in an MNC has a
separate HR team, HR portal where employees are expected to mention their career, and
self-scoring systems based on targets being met, whereas in the startup, because it is a small
business and the owner performs the majority of HR functions, there is a human touch involved
throughout the performance management process.

It was also stated that the most important aspect of the job for the small company in terms of the
requirements for efficient performance management was creativity. The MNC places a higher
priority on keeping systematic records and avoiding bias, but it is preferred to cultivate strong
relationships with the personnel so that it is simple to rely on them in times of need.
A startup's creator hopes that the employees will grow while they are under their leadership. In
contrast to the MNC, who expects their staff members to accomplish their targets by the
deadline, here they want their employees to share their ideas and help the business grow as a
team. as their field of work requires a great level of creativity.
START- UP INTERVIEW
1. What tasks do you delegate to your employees?

Since I run an online marketplace selling handmade soaps, I have a variety of responsibilities,
including packaging, photography, warehousing, and shipping. Except for manufacturing, I
either hire individuals or outsource these tasks. Currently, we outsource the photographs to a
photography business while another agency handles the warehousing and shipping. In addition,
we outsource performance marketing for our company.

2. What, in your opinion, are the most important conditions (applicable to both employers
and employees) for effective performance management?

When it comes to employees, I consider their approaches to problem-solving as well as the

amount of work they can complete without my help and without needing constant direction. For
instance, all of my staff should be able to serve as customer service representatives and answer
their questions. I also have to consider the creativity of their work, the length of time it takes
them to complete a task, and the flexibility of their work schedules. Here, working on Saturdays
and Sundays is strictly prohibited. However, in times of need, many of my staff members have
come to me and offered to work on Saturdays because they understood how difficult it may be
for me. In addition to this, I believe that a worker's patience is quite important. Even if you make
a mistake, the capacity to learn from it and avoid repeating it is much valued.

3. What do you expect from the startup's workers in terms of their overall performance, both
now and in the future?

I think that the expectations and their effective performance are related. The qualities I'd want
my staff to possess include adaptability, quick thinking, creativity, flexibility, patience, and more.

4. What steps do you take to maintain track of the present or evolving performance review
expectations of your staff?

I make sure that both the working atmosphere I create for them and the incentives, increments
meet their expectations. I ask my staff about their performance, the performance of the company,
and any areas where they feel we can make improvements during the monthly performance
review.
 Findings

● We spoke with the startup's owner in an interview. The comparison and analysis of performance
management was the interview's primary objective.

● In contrast to the MNC, it was noticed that the startup gave their employee reviews and
evaluations more of a human touch. For instance, the small business owner claimed that she
enjoyed regularly evaluating her personnel based on several criteria, but an MNC has a user
interface created specifically for this function.

● Additionally, it was noted that the creative side of the job was crucial for small businesses when
it came to the essential elements of effective performance management. While the MNC
prioritised keeping systematic records and avoiding bias, she wanted to establish solid
relationships with the employees so that she may rely on them in times of need.
Conclusion
Emerging trends in performance management will help an organisation modernise and take on a
critical duty for better career development to fit the current business climate. Performance
management has evolved into a crucial supervisory ability in the quickly changing environment
and changing trends since the supervisor who rates his or her employee too highly or too low is
doing a damage to them and to the firm. Therefore, it would appear essential for every firm to
understand emerging trends and conduct appraisals efficiently in order to put them into practise
in the twenty-first century. Thus, the gap between employees will be reduced thanks to these new
trends and techniques.

As a result, incorporating the recently created effective Performance Management system will
help in creating a link between the performance standard and essential job components identified
through a job analysis as well as dimensions to be rated for a specific job and organisation for
Career Advancement, Employee Performance and productivity and Professional Standards.
References-

1. https://www.pwc.in/assets/pdfs/publications/2016/performance-management-in-india-a-c
hange-beckons.pdf

2. https://www.academia.edu/10388386/A_RESEARCH_PAPER_ON_STUDY_OF_EMPL
OYEE_S_PERFORMANCE_MANAGEMENT_SYSTEM_

3. https://www.ijnrd.org/papers/IJNRD1706009.pdf

4. https://www.researchgate.net/publication/228118655_Performance_Measurement_Syste
ms_in_SMEs_A_Review_for_a_Research_Agenda

5. https://www.researchgate.net/publication/272723729_The_Use_of_the_Balanced_Scorec
ard_in_Small_Companies

6. https://scholar.google.com/scholar?hl=en&as_sdt=0%2C5&q=introduction+to+performa
nce+management&oq=Introduction+to+performance+#d=gs_qabs&t=1671472636007&
u=%23p%3D2VJIFT5uv7EJ

7. https://scholar.google.com/scholar?hl=en&as_sdt=0%2C5&q=performance+management
+in+mnc&btnG=#d=gs_qabs&t=1671472842753&u=%23p%3DJiJzYob7KjMJ

8. https://scholar.google.com/scholar?hl=en&as_sdt=0%2C5&q=introduction+to+performa
nce+management&oq=Introduction+to+performance+#d=gs_qabs&t=1671472636007&
u=%23p%3D2VJIFT5uv7EJ

9. https://www.forbes.com/sites/forbeshumanresourcescouncil/2022/05/13/top-three-trends-i
n-performance-management-in-2022/?sh=42b32f3c2177