Assignment Sample on Performance management
Performance management plays a crucial role in achieving the strategic objectives by aligning their employees, systems, and resources systematically. According to Akhtar and Sushil, (2018) strategic performance management is discussed as a comprehensive approach that can be helpful for organisation to achieve the goal. On the other hand, it can be defined as the methodology to enhance performance measurement, analysing, and improving the process of achieving organisation objectives. It primarily focuses on teams so diverse opinions can form a more iterative approach. The report will use a diverse analytical framework so the concept of strategic performance management can be explained. Strategic performance management is an approach that helps line executives in understanding the organisation’s goals more clearly and offers an ongoing mechanism so the progress for achieving the goal can be measured.
As opined by Islami et. al. (2018) performance appraisal is described as a regular process for reviewing the employee’s performance and their contribution to achieving the goals. Performance appraisal is used by the company to provide feedback to employees adequately so they can enhance their work efficiency. It will also help the company in providing bonuses and salary increments as per their contribution. The process can be conducted at any time but most of the companies conduct the process semi-annual, annual or quarterly. Performance appraisal is done so the funds can be allocated adequately to the employees that can be a beneficial asset to the company. It will also help leaders and managers to arrange training and development programs for employees so they can enrich their skills.
Strategic performance management
The strategic performance management system is a process the helps in enhancing the efficiency of the compensation system that includes promoting self-interest, organisational performance, and employee performance. The entire systems make sure that employees meet the organisational goals and achieve the set of objectives as per the strategic plan. The strategic management model offers resources to the company that can be used by the company for getting better results (Yuliansyah and Jermias, 2018). The strategic performance measurement is combined with strategy priority vision, corporate alliance, value, mission, and organisational performance index. The value of SPMS is already defined so resources can be used efficiently and work procedures can be completed. The values are combined with success indicators as organisational objectives are limited to below the organisational level.
Furthermore, it is mandatory to keep the initial output premium as it helps in keeping strategic priorities, mission, production, and vision clear. The key to achieving growth and success in business can be achieved if strategies planned are defined clearly and adequately. Strategic performance management requires a work environment that meets employee needs. According to Adler, (2018) there can be seen planning to meet the designed or expected success. It can be linked to performance appraisal as it helps motivate employees for enhancing their work efficiency. It also includes adequate coaching and training programs so to increase the skills of employees as per requirements.
For having great strategic performance management in any organisation it is mandatory to communicate company goals and lined-up objectives appropriately. It can be said that if organisational goals are not explained then employees or leaders won’t be able to implement strategies as per the objectives. Other than that, improperly defined goals can enhance the challenges for group members to achieve success (Yuliansyah et. al. 2019). It can be stated that the achievement of organisational goals will be low if the objectives are not communicated effectively. AS there can be seen rapid advancements in technology, an organisation can utilise performance management software. The software will help the company in analysing the performance of employees and provide them with development programs if necessary.
Moreover, strategic performance management can be helpful if the company monitors the strengths of employees and assign them to work as per their skills can help in enhancing the success of the organisation (Layland and Redding, 2019). It can be highly achieved if the leaders are aware of their team member’s skills and help them in improving their work efficiency by providing them adequate feedback. The leaders must provide them with rewards and incentives so they can keep their employees motivated and keep them connected with their organisational goals.
Tesco’s performance management framework
The strategic performance management framework formed by Tesco so they can increase their business performance and plan strategically is developed. It is known as a corporate steering wheel. These performance frameworks are a strong tool for aligning every organisation behind their corporate vision and allow them to make sure that the delivery of strategy is managed and monitored (Tesco- Evolving the Strategic Performance Framework, 2018). The steering wheel developed by Tesco is being divided into four perspectives: Finance, customer, people, and operations. Every perspective has diverse strategic goals that show the priorities of the business organisation. It majorly consists of four goals that include shopping is better for customers, operation way is cheaper for Tesco, work is simpler for staff and the company operates safely and responsibly.
Tesco is constantly aiming at changing its steering wheel in line by shifting its strategic objectives. They have added a fifth perspective to their steering wheel after monitoring the impact of climate change and environmental concerns. It can be highly responsible for impacting the business growth and needs to be implemented in strategic focus. According to Evans and Mason, (2018) the fifth perspective is significantly focused on two major goals that are a good neighbour, be fair, responsible, and honest.
The new community perspective initiated a strategy for reducing the usage of carrier bags by 50% and decreases the carbon footprint. Other than that, Tesco also updated here performance framework regularly so they can keep implementing strategies as per the market demands.
Performance appraisal
Performance appraisal is very necessary for enhancing employee engagement as it keeps them motivated. There can be seen as two types of motivation that are extrinsic and intrinsic motivation. Performance appraisal is described in the category of extrinsic motivation. It offers employees diverse rewards, incentives, bonuses, and salary increments (Manjula, 2018). Performance appraisal also helps the organisation in boosting their employee’s productivity and improves their outcomes. Performance management is very essential, as it helps in analysing the wage rise of employees and promotion but it also helps in analysing the employee’s skills, talents, strengths, and weaknesses adequately. There are diverse methods that can be used by the organisation to monitor performance appraisal.
Management by Objectives (MBO): It is an appraisal method where employees and managers identify objectives, plan, and communicate objectives so an accurate focus must be kept on a specific appraisal period. The method is used to match the organisational goals with employee’s objectives using the SMART method to analyse the objectives appropriately. At the time of results, the performance of employees is measured by their results (Islami et. al. 2018). From this, employees are provided with rewards using salary hikes or promotions. On the other hand, failures are also managed by providing them with adequate training and development programs. The process primarily aims at stressing over tangible goals and intangible aspects like commitment, interpersonal skills, and many more.
The performance appraisal using management by objectives is consisted of three major steps that include plan, monitor and review. In the planning process objectives will be defined, control points are set and timeline will be decided. It will help employees in completing their task as per the assigned timeline. After that, the process of monitoring will be started and in this progress of task will be analysed, goals will be reassessing and feedbacks will be given so employees can manage their task accordingly based on the feedbacks. As per (Practical Performance Appraisal Methods, 2020) in the last step, results will be collected to start the process of reviewing the performance. In this, appraisal will be given in the form of rewards, bonus, salary increments and promotions.
360- Degree Feedback: It is a multidimensional appraisal method that evaluates performance employees by analysing the feedback collected from the circle of employees including peers, customers, managers, and direct reports. As opined by Das and Panda, (2017) it is beneficial because the method will eliminate biased reviews and provides a clear understanding of the performance of every individual. The method consists of five primary components that are self-appraisals, peer reviews, managerial reviews, subordinate appraising managers, and client or customer reviews. In self-appraisals provides the employee a chance to analyse their performance and they will easily identify their weaknesses and strengths. The drawback of self-appraisal is it can become fickle, biased, and lenient if it is not well-structured.
Furthermore, the second component is managerial reviews in which feedbacks are given by managers. In this, the individual rating will be awarded by superiors and team performance will be evaluated by senior managers (Kahya and Çemrek, 2017). It can be seen that team members are capable of analysing the group’s performance adequately so taking peer reviews can be beneficial. It helps in determining the employee’s ability and they will provide unbiased feedback. Taking peer review can end up distorting relationships sometimes if any bad review is given.
Along with that, subordinate-appraising manager is an upward appraisal of this method. In this, a unique perspective is used by reporters based on a managerial point of view. The entire performance appraisal can enhance strategic performance management if customer feedback can be taken. Individuals using the products are capable of giving reviews adequately. Customer reviews can monitor the output of an employee’s efficiently as they will give unbiased reviews (Practical Performance Appraisal Methods, 2020). The major advantage of using this method is that it will increase an individual’s awareness about their performance and work on improving their work efficiency. It will be beneficial for leaders and managers to organise training and development programs for employees so they can stay motivated and think out of the box. Taking feedback from stakeholders will help in enhancing the level of engagement and also enables customer satisfaction.
Performance appraisal at Tesco
Tesco also uses a 360-degree performance appraisal method and is a great example for enhancing the benefits of the organisation using this tool. In their method, senior managers and directors offer feedback as a precursor to the leader’s training program. It will help the company highlighting the development needs and strengths along with developing new leadership skills (Alam and Raut-Roy, 2019). The results will help in shaping the personal development plans. They declared that the tool is an effective method for another level of the job as well. It includes informing career conversations and highlight development needs for their highest potential and skilled employees.
Furthermore, the inspiring great performance program focuses on reframing performance management emphasizing honest and constructive conversations. It also helps in giving a brief description of the method used by the employees to achieve the goal. In this way, they evaluate their employee’s performance and provide them rewards effectively. They also offer their employees discounts as rewards. For instance, employees will get colleague cardboard that offers 10% off on groceries, 10% off on Tesco mobile, 25% on Tesco coffee, 20% off on the home, car, and pet insurance, and 20% off on clothing (Tesco’s reward policy, 2017). Other than that, it also included maternity paid leave, sick and holiday pay; buy as you earn schemes, and many more. By providing such facilities, their employees stay motivated and also help in enhancing their performance.
It has been concluded from the case study analysis the strategic performance management and performance appraisal are essential for increasing organisational success. On the other hand, strategic performance management also helps in addressing the goals adequately so the employees can perform effectively. On the other hand, performance appraisal is described as extrinsic motivation essential for improving the employee’s work efficiency and keeping them motivated. Two methods are discussed that include management by objectives and the 360-degree performance appraisal method. The 360-degree method will help the organisation in taking feedback and rewarding based on them. Tesco utilises a steering wheel performance management framework and 360-degree performance appraisal method for enhancing their employees and organisational performance.
References
Books and Journals
Akhtar, M. and Sushil, S., (2018). Strategic performance management system in uncertain business environment. Business Process Management Journal.
Alam, S. and Raut-Roy, U., (2019). Evaluating the Effectiveness of Reward Strategy at Tesco: Evidence from Selected Stores in UK. Indian Journal of Industrial Relations, 55(1).
Das, U.K. and Panda, J., (2017). The Impact of 360 Degree Feedback on Employee Role in Leadership Development. Asian Journal of Management, 8(4), pp.962-966.
Evans, B. and Mason, R., (2018). The lean supply chain: managing the challenge at Tesco. Kogan Page Publishers.
Islami, X., Mulolli, E. and Mustafa, N., (2018). Using Management by Objectives as a performance appraisal tool for employee satisfaction. Future Business Journal, 4(1), pp.94-108.
Islami, X., Mulolli, E. and Mustafa, N., (2018). Using Management by Objectives as a performance appraisal tool for employee satisfaction. Future Business Journal, 4(1), pp.94-108.
Kahya, E. and Çemrek, F., (2017). An investigation on the ratings from four sources for different positions in a 360 degree feedback system. Eskisehir Osmangazi University Journal of Economics and Administrative Sciences, 12(3), pp.49-64.
Layland, A. and Redding, S., (2019). Strategic Performance Management: A Journey in Organizational Effectiveness. National Comprehensive Center at Westat.
Manjula, R., (2018). An Insight into the Practical Performance Appraisal Methods for the Contemporary Employees. The International Journal of Multidisciplinary, 3, pp.1317-1318.
Yuliansyah, Y. and Jermias, J., (2018). Strategic performance measurement system, organizational learning and service strategic alignment. International Journal of Ethics and Systems.
Yuliansyah, Y., Khan, A.A. and Fadhilah, A., (2019). Strategic performance measurement system, firm capabilities andcustomer-focused strategy. Pacific Accounting Review.
Online
Practical Performance Appraisal Methods. (2020). [Online]. Accessed through: <https://kissflow.com/hr/performance-management/employee-performance-appraisal-method/>
Tesco- Evolving the Strategic Performance Framework. (2018). [Online]. Accessed through: <https://bernardmarr.com/default.asp?contentID=1054>
Tesco’s reward policy. (2017). [Online]. Accessed through: <https://www.tesco-careers.com/explore-our-world/benefits/>
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