UNIT- 5

TEAM PERFORMANCE MANAGEMENT

Meaning of Team Performance Management

Team performance management is the process of ensuring that a team's performance is

constantly improving. It involves activities like:

Setting team goals

Monitoring the achievement of those goals
Sharing team feedback.
Rating & rewards

Performance Management and Learning Organisation

Helping People to learn through Performance Management

Performance management provides learning opportunities during its three main stages:

Performance agreement and planning,

Managing performance throughout the year.
Performance review.

The performance agreement as a framework for learning

The learning opportunities offered by performance management are based on the initial
activities in the performance agreement and planning part of the cycle. This includes a
joint analysis of the individual's role so that a new or updated role profile can be
produced that sets out what results are to be achieved and what competences are
needed to deliver those results. Discussions take place on ways in which the individual's
role could be developed so that it becomes more challenging from the viewpoint not
only of new tasks to be accomplished but also the need to acquire or extend knowledge
and skills in order to carry out those tasks.

Learning throughout the year

Learning is inseparable from activity, and like performance management it is a

continuous process. Every task carried out by someone presents a learning opportunity
and it is the duty of managers to help people become aware of this and to support the
day-to-day learning that takes place. They should enable people to understand how
they should tackle a new task and what additional knowledge or skills they will need.
Guidance can be provided by asking questions on what individuals need to know and be
able to do to undertake a task, leaving them as far as possible to think for themselves
but helping them when necessary.
Performance reviews as learning events

Performance reviews, whether conducted formally or informally, can be regarded as

learning events. Learning opportunities are provided before, during and after formal
meetings. Prior to a review individuals can be encouraged to think about what they feel
they want to learn, new skills they would like to acquire and the direction in which they
want to develop. During the review individuals can present to the reviewer their views
about what they have learned and what they need to learn.

Performance Management and Virtual Team

Set clear expectations and goal.

One of the keys to successful virtual team leadership is to communicate clearly and
frequently what you expect from your team members and what they can expect from
you. Define the scope, deadlines, and quality standards of each project or task, and
use SMART (specific, measurable, achievable, relevant, and time-bound) goals to track
progress and results. Also, clarify the roles and responsibilities of each team member,
and how they contribute to the overall vision and mission of your organization.

Use the right tools and platforms.

Another essential aspect of virtual team leadership is to use the right tools and
platforms to facilitate communication, collaboration, and coordination. Depending on
your needs and preferences, you can choose from various options for video
conferencing, instant messaging, file sharing, project management, and performance
management. For example, you can use Zoom or Skype for regular meetings and
check-ins, Slack or Teams for quick updates and chats, Google Drive or Dropbox for
sharing documents.

Provide regular feedback and recognition.

Feedback and recognition are vital for boosting the performance and engagement of
your virtual team. They help you to acknowledge their achievements, address their
challenges, and guide their development. Make sure you provide both positive and
constructive feedback and use a balanced mix of formal and informal methods. For
example, you can use performance reviews or 360-degree feedback for formal
feedback, and use emails, chats.

Build trust and rapport.

Trust and rapport are the foundation of any effective team, but they can be harder to
establish and maintain in a virtual setting. To build trust and rapport with your virtual
team, you need to be transparent, honest, and consistent in your communication and
actions. You also need to show empathy, respect, and appreciation for your team members,
and understand their diverse backgrounds, perspectives, and preferences. Furthermore, you
need to create opportunities for social interaction and bonding, such as virtual coffee breaks,
happy hours, or team-building activities.

Promote well-being and balance.

Well-being and balance are crucial for sustaining the performance and engagement of
your virtual team. They help you to prevent burnout, stress, and isolation, and
enhance their health, happiness, and productivity. Promote well-being and balance by
setting realistic expectations and boundaries and respecting your team members'
work-life integration. Also, encourage them to take breaks, exercise, and practice self-
care. Additionally, provide them with support and resources to cope with any
challenges or difficulties they may face, and check in with them regularly to see how
they are doing.

Role of Line Managers in Performance Management

1. Preparing role profiles - defining key result areas and competency requirements
2. Defining goals.
3. Identifying and using performance measures.
4. Giving and receiving feedback.
5. Identifying learning needs and preparing and implementing personal development
plans.
6. Diagnosing and solving performance problems (managing poor performance)
7. Coaching.

Performance Management and Rewards

Performance management can play an important part in a total reward system in

which all reward elements are linked together and treated as an integrated and
coherent whole. These elements comprise base pay, contingent pay, employee
benefits and non-financial rewards, which include intrinsic rewards from the work
itself.

It is sometimes assumed that the main purpose of performance management is to

generate ratings to inform contribution or performance-related pay decisions.
Performance management can provide for a whole range of rewards in order to
encourage job engagement and promote commitment. These rewards can take the
form of recognition through feedback, opportunities to achieve, the scope to develop
skills, and guidance on career paths.

Performance management and non-financial rewards

Performance management and recognition

Performance management involves recognizing people's achievements and strengths.

They can be informed through feedback about how well they are performing by
reference to achievements and behaviours. They can be thanked, formally and
informally, for what they have done. They can be helped to understand how they can
do even better by taking action to make the best use of the opportunities the
feedback has revealed.

Performance management and the provision of opportunities to achieve.

Performance management processes are founded on joint agreements between

managers and their people on what the roles of the latter are and how they can be
developed (enriched). It is therefore an essential part of job or role design and
development activities.

Performance management and skills development

Performance management can provide a basis for motivating people by enabling them
to develop their skills. It provides an agreed framework for coaching and support to
enhance and focus learning.

Performance management and career planning

Performance management reviews provide opportunities to discuss the direction in

which the careers of individuals are going and what they can do with the help of the
organization-to ensure that they follow the best career path for themselves and the
organization.

Performance management and job engagement

People are engaged with their jobs when they are interested in what they do and have
a sense of excitement in their work. This can be created by performance management
when it concentrates on intrinsic motivating factors such as taking responsibility for
job outcomes (autonomy), job satisfaction, achievement and fulfillment of personal
growth.

Performance Management and Pay/Financial Rewards

Increased employee motivation and engagement

A performance management and rewards system links employee rewards with how
well they do their work. Moreover, managers have the opportunity to invest
substantial time towards meaningful activities – like checking in on employees and if
they are pursuing the right targets and goals. They enable employees to maximize
their abilities and duties. In turn, this increases the likelihood of job satisfaction and
fulfillment.

Improved productivity and performance

These systems enhance the overall efficacy of the organization. Employees who are
performing well will deliver outstanding work and be more inclined to take on new
things and keep moving forward. When a few employees are rewarded, it may also
inspire their co-workers to be more productive and improve their performance.

Enhanced employee retention and loyalty

Because human capital is such a valuable asset, it is crucial to discover methods to

retain your employees. Employee autonomy is augmented when they are given a
chance to relentlessly pursue targets. They can then point out areas for improvement,
which, ultimately, gives them a reason to stay on. And since performance leads to a
coveted reward, it urges them to stay with the organization and keep performing.

Alignment of individual and organizational goals

The system encourages individuals while bringing together their personal and
organizational objectives. This methodology is continuous and ongoing, in comparison
to the conventional approach, which is primarily recognized for its annual assessment
of performance. Employees are constantly working towards a tangible goal and reward
while simultaneously contributing to the company’s growth.

Linking Performance to Pay Using Simple Band System

Performance-based pay systems are designed to align employee compensation with

individual and performance. One straightforward approach involves the use of pay
bands, which categorize employees into salary ranges based on their performance and
contributions. This simple system offers transparency, motivation, and a clear link
between performance and pay.

Components of the System:

1. Pay Bands:

Pay bands are predetermined salary ranges that encompass different levels of
compensation.

Structure: The pay bands are structured to accommodate various performance

levels, creating a tiered system.

2. Performance Levels:
Employees are assessed and categorized into different performance levels based on
their, achievements, skills, and contributions.

Criteria: Clear criteria are established to determine performance levels, ensuring

objectivity and fairness.

3. Performance Assessment:

Regular Evaluations: Conduct regular performance evaluations to assess

employees against predefined criteria.

Feedback: Provide constructive feedback to employees regarding their

performance, strengths, and areas for improvement.

4. Linking Performance to Pay Bands:

Mapping Performance Levels: Each performance level corresponds to a specific

pay band.

Transparent Criteria: Clearly communicate the criteria for moving across

performance levels and the associated pay bands.

5. Salary Adjustments:

Merit-Based Increases: Employees moving to higher performance levels within a

pay band receive merit-based salary Increases.

Promotions: Consider promotions to a higher pay band for employees

consistently performing at an exceptional level.

6. Communication:

Transparency: Maintain transparency by communicating the link between

performance, pay bands, and potential salary adjustments.

Expectations: Clearly outline expectations for employees to progress within the

pay bands.

Challenges of Linking Performance to Rewards

Linking performance and reward is a common practice in organizations, but it comes

with its set of challenges. Effectively addressing these challenges is crucial for
maintaining a fair, transparent, and motivational performance management system.

Subjectivity in Performance Evaluation:

 Challenge: Assessing individual performance can be subjective, leading to
potential biases and unfair evaluations.

Solution: Implement clear and objective performance criteria, provide training to

managers on fair evaluation practices, and incorporate multiple perspectives in
the assessment process

Equity and Fairness Concerns:

Challenge: Employees may perceive the performance evaluation process as unfair,

especially if there are inconsistencies in reward distribution.

Solution: Ensure transparency in the performance management system,

communicate the criteria for rewards clearly, and address any concerns or
disputes promptly.

Communication Challenges:

Challenge: Ineffective communication about the link between performance and

rewards can lead to confusion and misunderstanding among employees.

Solution: Establish a robust communication strategy that clearly articulates the

connection between performance and rewards. Regularly update employees on
performance expectations and reward opportunities.

Budgetary Constraints:

Challenge: Organizations may face limitations in budgetary allocations for

performance-based rewards. impacting the ability to offer competitive incentives.

Solution: Align the reward system with the organization's financial capabilities.
Prioritize impactful and meaningful non-monetary rewards and explore creative
solutions within budget constraints.

Employee Preferences and Diverse Needs:

Challenge: Employees have diverse preferences and needs, and a one-size-fits-all

approach may not cater to everyone.

Solution: Offer a range of rewards, both monetary and non-monetary, and provide
flexibility for employees to choose rewards that align with their preferences.
Regularly gather feedback to understand employee preferences.

Short-Term Focus vs. Long-Term Goals:

 Challenge: A focus on short-term performance goals may lead to neglect of long-
term strategic objectives.

Solution: Balance the performance evaluation system by incorporating both

short-term and long-term goals. Encourage managers to consider the broader
impact of employee's contributions on organizational success.

Overemphasis on Individual Performance:

Challenge: Overemphasizing individual performance may neglect the importance

of teamwork and collaborative efforts.

Solution: Incorporate team-based metrics and recognition into the performance

evaluation process. Acknowledge and reward contributions to collective
achievements.

Resistance to Change:

Challenge: Employees and managers may resist changes in the performance and
reward system, particularly if it deviates from established practices.

Solution: Involve employees in the design and modification of the performance

and reward system. Clearly communicate the reasons for changes and highlight
the benefits for both individuals and the organization.

Lack of Development Focus:

Challenge: A sole focus on rewards may overshadow the importance of employee

development and growth.

Solution: Integrate performance discussions with development conversations.

Encourage managers to discuss career paths, skill enhancement, and training
opportunities during performance evaluations.

Inadequate Recognition Programs:

Challenge: Insufficient or poorly designed recognition programs may diminish the

impact of rewards on employee motivation.

Solution: Implement robust recognition programs that celebrate achievements

promptly and consistently. Ensure that recognition is tailored to individual
preferences.

Perceived Lack of Transparency:

 Challenge: Employees may perceive a lack of transparency in the performance
evaluation process, leading to mistrust

Solution: Maintain transparency by clearly communicating the performance

criteria, evaluation process, and the connection between performance and
rewards. Address any concerns about transparency promptly.

Legal and Ethical Considerations:

Challenge: Inappropriately linking performance and rewards may raise legal and
ethical concerns. particularly if it leads to discrimination or unfair treatment.

Solution: Ensure that the performance and reward system complies with legal
requirements and ethical standards. Conduct regular audits to identify and
address any potential issues.