Pms Guidelines 2

Measures must be balanced Leading Financial Objective Internal Quantitative Long term

•Lagging •Nonfinancial •Subjective •External •Qualitative •Short term

How many performance measures? • “Too many measures guarantee you have virtually none” • Measures should be • Focused on overall corporate strategy • Appropriate to their purpose: what and who are you measuring? • In the right language: “translating into metrics that make sense to the individual’s work” • Aligned with an incentive for the individual towards motivation and commitment to achieving objectives • Refined only when necessary to realign with strategy • Focused on information, not data

Sample measures • • • • • •

• • • • •

Financial Net profit Revenue growth ROI Return on capital employed Shareholder value

Internal processes New product revenue Cross –sell ratio Productivity levels Quality levels of products/services • Implement cost reduction initiatives that will result in more efficiencies

• • • • •

Customer Benchmark processes Client surveys Provide value for money Number of fee-based products offered • % of sales from new products

• Organisational learning & growth • Revenue per employee • Employee surveys • Strategic skills coverage • Level of skills retention • Staff turnover • Cost savings

Setting targets

Setting Targets • Targets involve specifics of what you want to achieve and by when. • Some targets can only be set if you know what the base is. • One objective could have more than one target but once again focus is the key.

Performance Contracts TEMPLATE ¾Page 1: Details on person and position ¾ Page 2: Objectives, Measures, Targets, Ratings (use job description) ¾ Page 3: Competencies, Skills, Knowledge and Behaviour ¾ Page 4: Development Plan ¾ Page 5: Comments

Development Plans •Bridge the gaps in performance related to objectives and competencies and prioritise an action plan for development •A variety of methodologies: − − − − − − − − −

Training courses Education programmes Self-study Coaching Workshops Meetings Work tasks Short-term assignment Job rotation

Performance management system BALANCED Communicate the “big picture” of the organisation’s strategies and departmental goals to employees and show the relationship of their jobs to the organisation’s success

SCORECARD Provide frequent informal coaching that recognises good performance results and that gets below-target performers back on track

1. Performance Planning and Contracting

2. Performance Coaching and Feedback

Development plans for each individual

PERFORMANCE MANAGEMENT

4. Reward

Tie tangible and intangible rewards to performance levels

3 Performance Review Gather performance information from employees and assess each employee’s results vs. Performance Targets

Performance coaching and feedback ¾

Should be on-going and frequent ¾ Can be informal ¾ Encourage good performance ¾ Attempt to get below target performance back on track

Performance management system BALANCED Communicate the “big picture” of the organisation’s strategies and departmental goals to employees and show the relationship of their jobs to the organisation’s success

SCORECARD Provide frequent informal coaching that recognises good performance results and that gets below-target performers back on track

1. Performance Planning and Contracting

2. Performance Coaching and Feedback

Development plans for each individual

PERFORMANCE MANAGEMENT

4. Reward

Tie tangible and intangible rewards to performance levels

3 Performance Review Gather performance information from employees and assess each employee’s results vs. Performance Targets

Potential Problems with Performance Reviews….. ¾ Objectives not being set before assignment ¾ Objectives being set 6 months after assignment completed ¾ Staff evaluations 6 months after job completed ¾ Weaknesses identified and discussed months later (too late!) ¾ Comments on a number of assignments condensed into one appraisal ¾ Managers not taking responsibility for Performance Mgt ¾ Managers regard it as an administrative nuisance

Potential Problems with Reviewing… • The Halo effect • Shifting standards • Bias • Lenient/Harsh Rater

The appraisal interview DO

DON’T

Be supportive

Be confrontational

Be developmental

Apply stress

Conduct a conversation

End up with a win-lose situation

with a purpose Engender mutual trust

Use tricks and surprise questions

End with a win-win situation

Types of Employee responses •Defensive

•

•Passive •Hurt •Accepting

HOW TO HANDLE EMOTIONAL SITUATIONS DEFENSIVE

•Ignore the attack or excuse and stick to the issue at hand •Admit the truth •Postpone employee issue until later •Get back to the issue of performance •Turn the question back when he/she wants to derail you from the topic

HOW TO HANDLE EMOTIONAL SITUATIONS • Passive • Draw out people by asking questions rather than • over-talking your points • Don’t answer your own questions

HOW TO HANDLE EMOTIONAL SITUATIONS • Hurt • Don’t get enveloped by employee’s depressed • reaction, instead describe the performance • and stick to that

• Paraphrase, reflect, emphasize where appropriate

HOW TO HANDLE EMOTIONAL SITUATIONS Accepting

•During the interview, point out live, here and now, examples of relationship problems

Managing conflict in performance reviews DEFINITION OF CONFLICT

Conflict can be described as a problem or disagreement which occurs as a result of differing ideas or goals The way a conflict is managed

Rather than suppressed, ignored, or avoided – contributes significantly to a company’s effectiveness

Conflict Modes ASSERTIVE NON- ASSERTIVE

CONCERN FOR PERSONAL GOALS

COMPETING

COLLABORATING

COMPROMISOR AVOIDING

UNCOOPERATIVE

ACCOMMODATING

COOPERATIVE

The Accomodator • • • •

Conflict is disturbing Does not like conflict Will avoid it whenever possible Shows the opposite of inner feelings in conflict situations(Anger = smiling; Tension = humor) • Is convinced that only bad things can come out of conflict PHILOSOPHY:

In the final analysis it is wise to turn the other cheek

The Avoider • • • • •

Conflict is bad Avoids conflict at all costs Leaves the scene if possible Does not get personally involved. Follows the rules Believes he has no control over the outcome

PHILOSOPHY:

It is useless to try to change a person who seems locked in an opposing view.

The Compromiser • • • • •

Conflict is an intellectual challenge No-one wins Don’t be confrontational Hide your feelings Resolution comes with compromise

PHILOSOPHY:

Winning is rarely possible in conflict

The Collaborator • • • • •

Conflict is good Parties are able to express their opinions All parties to a conflict have a valid contribution to make There is always middle ground Resolved conflict will bring the parties together

PHILOSOPHY:

No-one has the final answer to anything but each has something to contribute

The Competitor (Controller) • • • • •

Conflict is energising Takes charge in conflict situations Arguments are ready and knows that his position is right Uses tactics which work Settles the conflict as quickly as possible

PHILOSOPHY:

Life is conquered by those who believe in winning

Guidelines for managing unsatisfactory performance discussions.

•Step 1: Raise the self esteem of the employee

Step 2: Outline the performance areas that need improvement Step 3: Explain why the present performance causes you difficulty Step 4: Find out the reasons for their present performance and make it clear you understand the position Step 5: Ask them for ideas on how to improve the performance and note these ideas Step 6: Ask them what you can do to help them Step 7: Confirm mutual action steps to be taken by both of you Step 8: Agree a follow-up date

Your role as a manager ¾ Explain the Bank and department strategy and goals – attempt to create line of sight. ¾ Help set objectives with your people and ensure that performance contracts are linked to departmental objectives. ¾ Clarify job expectations with the employee. ¾ Help with drafting development plans. ¾ Assist the employee to achieve objectives. ¾ Provide on-going coaching and feedback on performance and development progress. ¾ Collect feedback for formal reviews. ¾ Provide formal performance reviews. ¾ Discuss career aspirations

Your role as an employee ¾ Collaborate with your manager on drafting your performance contract. ¾ Ensure that you understand your objectives, measures and targets. ¾ Create your development plan. ¾ Act on your development plan. ¾ Ask for coaching and feedback from your manager and others. It is your right to get feedback. ¾ Take an active part in performance review discussions. ¾ Give feedback to others.

Performance management system BALANCED Communicate the “big picture” of the organisation’s strategies and departmental goals to employees and show the relationship of their jobs to the organisation’s success

SCORECARD Provide frequent informal coaching that recognises good performance results and that gets below-target performers back on track

1. Performance Planning and Contracting

2. Performance Coaching and Feedback

Development plans for each individual

PERFORMANCE MANAGEMENT

4. Reward

Tie tangible and intangible rewards to performance levels

3 Performance Review Gather performance information from employees and assess each employee’s results vs. Performance Targets

Rewards ¾ Align tangible and intangible rewards to

performance ¾ Consequences of both achievement and nonachievement of objectives ¾ Reinforces positive behaviours

¾ “ The behaviour that gets rewarded gets repeated”