GROUP 4

Andina Liestyanti 29320064

Putra Gusrianto 29320071
Shanty Sarah 29320212
Febriany Martiana Nasel 29320007
Fadhila Nurfida Hanif 29320149

Gap Inc.: Refashioning Performance Management

Introduction About GAP Inc.
 GAP Inc. in 2015

BRANDS STORES AND DIGITAL REVENUES SUPPLY CHAIN COMPETITOR

CHANNELS

Gap, Old Navy, Banana Had more than 3,200 Revenues in 2015 topped Gap Inc. outsourced Mall retailers; women’s
Republic, Athleta, and locations in 50 countries $16.4 billion, an all-time production of its designs retailers; athletic wear
Intermix worldwide high. Net margins were to third-party garment retailers; department
around 7%. Old Navy and production companies and stores; and global
The company’s websites Banana Republic brands used third- party logistics retailers.
shipped to 90 countries generated more than half companies to ship its
in 2015 of the revenue merchandise to
distribution centers
DIAGNOSE AND
ANALYZE THE
PROBLEMS
 Performance Management
Performance Management is the process through which managers ensure that employee's’ activities and
output contribute to the organization’s goals
(Noe et al., 2011)

The Process of Performance Management

Organization establish performance management system
To meet three broad purposes:

Strategic Administrative Developmental

Support a shift in Provide meaningful reward

culture from nice for exceeding plan and
Raise the bar of
to nice and honest consequences for missing performance

GPS Ensure managers take accountability

for assessing, developing and
rewarding performance

Be simple
Source: Noe et al., 2011
Reformatting Performance Evaluations

Gap Inc., have revamped their performance management

Performance Management Process of GAP Inc. systems to eliminate ratings they feel demoralize and threaten
employees, take too long for managers to complete, and
constrain performance discussions to formal reviews conducted
one or two times each year.

Managers are given complete freedom to decide how often and

in what ways they want to set goals and provide feedback. That
is, both the employee and the manager consider what to
change to increase the likelihood that performance
will be effective. Employees are evaluated on the basis of how
they have performed against their goals rather than how they
compare to other employees.

Managers no longer have to complete lengthy performance

evaluation forms and submit them to HR. HR’s role is to provide
managers with consulting and tools to help with performance
discussions rather than policing to see if reviews are completed
or discussions have occurred. Both managers and employees
can access a resource center that provides materials about
coaching, giving feedback, and personal and professional
development.
 New Performance Management
Traditional Performance Management
(GPS – Grow, Perform, Succeed)
Before 2013
2013 above

Culture Nice Nice and honest

- In goal setting (we set tough objectives)

- Managers rated the employee in 4 rating scale (SAT,
- Managers inspire and drive through regular coaching
Performance Standard AT, OT, BT)
and feedback
- Year-end reviews
- For year-end rewards allocation

- Enterprise goals
- Key business goals
Goals - The GMT leader will have one set of goals (no more
- Lists of tasks that needed to get done
than 8 goals) which include enterprise initiatives

- frequent informal performance conversations

One hour-long conversation about performance with each - Build employee feedback skills by providing a course
Touch base
of their direct reports once a year in effective, “brain- friendly” feedback (Feedback
People Can Hear) and opportunities to practice.

- business performance would determine 75% of annual

The bonus was 50% financial (purely driven by business bonuses; individual performance would determine the
Rewards
unit performance) and 50% individual contribution (IC). remaining 25%.
- increased manager discretion on bonus allocation
THE PROBLEMS
Rob Ollander-Krane is hesitant to roll out Gap Inc.'s new performance management
system, GPS, to all of the company's stores. They can stick with the "traditional"
method or implement GPS in all stores, which will benefit Gap Inc.'s employees
and improve performance management. The current performance management
process in the stores, as well as the differences in environment and set-up between
the head office and the stores, must be considered when making this decision.
If it is decided that GPS will be implemented in all of
Gap Inc.'s stores, it will take a very long time for
behavior changes in all stores since the headquarter is
estimated to take three years and there is a possibility
of rejection from employees.
Level of workers knowledge A wide range of retail stores

Differences in knowledge and Gap Inc.’s has 3,279 stores around the
competence between headquarters and world, which employed the bulk of the
stores. company’s 140,000 employees

Difference environment Refusal from employees

Headquarter employees day-to-day jobs Even after getting an understanding of the

and work environment was very different new process and the potential to earn a
from what was found in the company’s larger bonus, they saw it as the company’s
stores leadership making
it harder for them to earn a bonus

Time consuming procedures Performance Measures Criteria

By changing the culture and performance Criteria to use to evaluate performance

management for the headquarter and store, management systems: strategic
it will take a long time, especially aspects congruence, validity, reliability,
of the behavior of employees and their acceptability, and specificity where the
respective managers headquarter and stores cannot be
generalized.

Problems analysis of GPS in retail stores