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Performance management tool


Company A has a clear Vision and Mission statement. Management has moved away from job descriptions for its employees as they found that their employees would only do what was in the job description and they did not use their initiative and innovation. Company A gives all its employees a 13th cheque in November, which is based on company performance and it is normally 100%. They are aware that some employees give more than 100% and some are under performing but still everyone is rewarded the same.

 Looking for a tool to help:
- reward high achievers
- feedback and goal setting.
- unclear expectations
- low morale when people feel they are not recognized for going the extra mile.
- deal with under performers
Any input would be highly appreciated. Please send me your different approaches (cost effective and not too complicated as it is a relatively small company).
Thanking you.

4 Responses

  1. Company A


    Interesting. I’m pleased to see the move away from job descriptions. I have worked without one for years and it is both more liberating and more effective. Though I know most organisations don’t trust their staff enough – or don’t trust their skills, intelligence, commitment or ability to work without structure – to take this step. I have always taken the view that if you don’t trust someone, don’t employ them. If you employ them, trust them. If they abuse that trust sack them. If they use that trust well, reward them.

    And with regard to reward, I’d be inclined to have a simple blend. For that 13th month they might get:

    – one week’s pay for their effort (based on their inputs or hard work, not on the outcome),

    – one week for their performance (based on their objectives or other agreed business measure),

    – one week for their contribution to the organisation (their corporate citizenship), and

    – one week based on the results of either their team, their business unit or the overall profit of the organisation (depending on whether it is more important to focus their line of sight on those things close to them that they can realistically impact or on the ultimate purpose of their activities and to give a sense of sharing in the collective success of the organisation)

    As to a tool, I guess the first port of call should be the line manager and to consider linking the reward decision to the performance management process. A classic approach with both pros and cons. Company A sounds like a more open and dynamic organisation than most so you might consider an alternative such as peer panels or reward points. For example, give everyone 100 corporate citizenship reward points that they apportion to colleagues, giving no more than 10 points to any one colleague and giving points to a least one person above and two below you in the hierarchy (if you have a hierarchy).  Then base the ‘contibution to the organisation’ reward on the number of points each person gets. There is a bit of the popularity contest about it, but for this type of issue it is as near or better than most line manager assessments. Using simple etchnology it is not too hard to administer but you have to think of the other 3 elements too, and keep the whole reasonable straightforward and transparent. An interesting challenge though.


  2. Performance Management Tool

     Hi Fiona,

    In response couple of points…

    1. Bit concerned when you say employer has moved away from job descriptions? Surely there is still a contract of employment and description of role requirements? If not..need to check if the company are still meeting their Employment law requirements!

    In my experience when there is a perception that employees are only working to their job tasks and lack innovation what’s needed in addition to role objectives is company wide behavioural competencies – linked to the vision and mission statement and values of the organisation. These, with + and – indicators, set the paramaters of expectation of not just what should be being done in the role, but how.

    2. These behavioural competencies can be established with employee involvement or dictated by management. Either way they should sit in the cycle of PM (i.e. Establsih and agree SMART objectives with individual – regularly review (informally) – formal 1/2 year & end of year reviews – End of year Appraisal – resulting in Performance related Grade/or Pay and establishment of Personal Development Plan….which then feeds into the next years SMART objectives)

    Establishing this process, agreeing a rating sytstem, and weighting to any pay reward, as well as training managers on SMART objective setting, performance reviewing and appraisal meetings is all achieveable. There are plenty of providers out there (ourselves included!!) that will provide training and guidence on the skills and process (documentation) needed.

    The size of your organisation might warrent a simple paper based system – but there are online systems that are easy to use and apply. 

    I wrote a white paper on the benefits of Online Appraisal Tools, which i can forward to you if interested.

    This link gives an example of an e-performance tool

    hope that helps







  3. Maybe some workers are motivated more than others?

    Hi Fiona,

    I remember reading a similar discussion on this here before but I can’t find it right now. It sounds like some workers are more ‘motivated’ to give more than others. If so, by taking away the reward you are acutally penalising someone that perhaps needs more encouragement. This could create a downward sprial as those who recieve a reduced cheque could be less engaged and contribute even less. By trying to make the distrbution of reward fairer you could be having a negative affect on company performance.

    How so? It’s important to understand that the 13th cheque is not as useful a motivator as conventional wisdom would have us believe.

    This TED video of Daniel Pink has some useful insights.


  4. And another thing…

    Just had to add a couple of points based on others’ comments. I’m a bit of a skeptic when it comes to the classic HR approach to competencies. I have nothing against the fundemental principle of core competencies but I have seen rather too many laborious competence structures that do little to drive performance or engagement in any real sense. It is right to consider them – a suggestion I support – but please do seek out real and meaningful best practice not that from a highly structured HR compliance perspective.

    The other useful comment is that reward is not always a motivator. I would go further. Financial rewards are rarely a good way to motivate people to work harder or better, particularly on their own. And if mismanaged can offer be more of a de-motivator, as I have found in research I have conducted. However, they key is in the word ‘reward’. This is about due recognition. It is also about giving a message about what is valued, and what employees should focus upon. And, if you get it right, it is about creating a package that is about you being a good and fair employer. Working for a good employer is a motivator, particularly when it comes to going the extra mile.


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