PERFORMANCE MANAGEMENT This resource is part of a range offered free to academics and/or students using Armstrong’s Handbook of Human Resource Management Practice, 11th edition, as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources.

AGENDA What are we trying to do? What’s happening to performance management? What are the performance issues? How can we improve the introduction and management of performance management? What innovations are taking place? This resource is part of a range offered free to academics and/or students using Armstrong’s Handbook of Human Resource Management Practice, 11th edition, as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources.

PERFORMANCE MANAGEMENT: WHAT ARE WE TRYING TO DO? Introduce and manage a systematic process for improving organizational performance by developing the performance of individuals and teams This resource is part of a range offered free to academics and/or students using Armstrong’s Handbook of Human Resource Management Practice, 11th edition, as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources.

WHAT PURPOSES? Obtain better results from the organization, teams and individuals by understanding and managing performance within an agreed framework of planned goals, standards and competency requirements Establish shared understanding of what is to be achieved, and manage and develop people in a way that ensures that it will be achieved Align individual objectives to organizational objectives and ensure that individuals uphold corporate core values Act as a lever for change This resource is part of a range offered free to academics and/or students using Armstrong’s Handbook of Human Resource Management Practice, 11th edition, as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources.

WHAT CHARACTERISTICS? Planning Feedback Measurement Performance management Dialogue This resource is part of a range offered free to academics and/or students using Armstrong’s Handbook of Human Resource Management Practice, 11th edition, as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources.

WHAT PROCESSES? Performance and development planning – performance agreement: role definition objectives competencies performance improvement personal development Review performance dialogue and feedback agree strengths and any areas for improvement build on strengths – ‘You are particularly strong in this area’ – how can you make even greater use of them? Act carry out role implement performance improvement plan implement personal development plan Manage performance throughout the year monitor performance provide continuous feedback provide coaching deal with underperformers This resource is part of a range offered free to academics and/or students using Armstrong’s Handbook of Human Resource Management Practice, 11th edition, as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources.

PERFORMANCE MANAGEMENT – SEVEN QUESTIONS What do we mean by performance? How can we identify good or poor performance? How can we establish the cause of good or poor performance? How can we motivate people to perform well? How do we deal with underperformers? How can we do all this fairly and consistently? How do we achieve line manager buy-in? This resource is part of a range offered free to academics and/or students using Armstrong’s Handbook of Human Resource Management Practice, 11th edition, as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources.

WHAT’S HAPPENING TO PERFORMANCE MANAGEMENT? This resource is part of a range offered free to academics and/or students using Armstrong’s Handbook of Human Resource Management Practice, 11th edition, as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources.

INCIDENCE AND FEATURES e-reward survey of performance management 2005 Performance review 99% Objective setting 99% PM covers all jobs 91% Personal development plans 89% Performance improvement plans 74% PM in place for more than 5 years 52% 360-degree 30% Competence 24% Web 16% 0% 50% 100% This resource is part of a range offered free to academics and/or students using Armstrong’s Handbook of Human Resource Management Practice, 11th edition, as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources.

PERFORMANCE MANAGEMENT OBJECTIVES e-reward survey 2005 Align individual and organizational objectives 64% Improve organizational performance 63% Improve individual performance 46% Basis for personal development 37% Develop a performance culture 32% Inform pay decisions 21% This resource is part of a range offered free to academics and/or students using Armstrong’s Handbook of Human Resource Management Practice, 11th edition, as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources.

IMPACT OF PERFORMANCE MANAGEMENT ON PERFORMANCE Views of respondents to e-reward survey 2005 not known 22% very significant 32% 10% insignificant 36% fairly significant This resource is part of a range offered free to academics and/or students using Armstrong’s Handbook of Human Resource Management Practice, 11th edition, as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources.

CRITERIA FOR SUCCESS e-reward survey 2005 management buy-in skilled managers treated as a business improvement model aligned with business objectives fits culture careful introduction not too complex not just about performance pay This resource is part of a range offered free to academics and/or students using Armstrong’s Handbook of Human Resource Management Practice, 11th edition, as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources.

WHAT ISSUES? This resource is part of a range offered free to academics and/or students using Armstrong’s Handbook of Human Resource Management Practice, 11th edition, as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources.

THE FOUR MOST FREQUENTLY MENTIONED ISSUES e-reward survey of performance management 2005 100% Line managers do not have required skills 88% Line managers do not discriminate sufficiently in making assessments 84% Line managers not committed to performance management 75% Line managers reluctant to conduct reviews 74% 0% This resource is part of a range offered free to academics and/or students using Armstrong’s Handbook of Human Resource Management Practice, 11th edition, as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources.

PERFORMANCE MANAGEMENT ISSUES BY SECTOR CIPD 2003 Communication of objectives 34% 35% 34% Management buy-in 29% 42% 34% Regular evaluation 18% 11% 18% Training 16% Public sector 13% 13% Manufacturing Simple process 14% Service sector 18% 15% Alignment with business objectives 14% 9% 13% 0% 10% 20% 30% 40% 50%

ARGUMENTS FOR AND AGAINST RATING Useful to sum up judgements about people Recognizes that we all form overall views about people Tells people clearly how they are doing and can be used as a basis for agreeing what needs to be done to improve the rating Can inform performance or contribution pay decisions Largely subjective Difficult to get consistency Over-simplifies complex judgements Overshadows performance reviews This resource is part of a range offered free to academics and/or students using Armstrong’s Handbook of Human Resource Management Practice, 11th edition, as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources.

UNILEVER The leader’s mindset I have to communicate my performance expectations with my employees Fairness and honesty impacts behaviour and performance Focus on utilizing strengths to the maximum and closing gaps The employee needs to take ownership for his or her development with my support It is my role to support by coaching, mentoring, leading, managing conversations I have to differentiate among people in my assessment and coaching This resource is part of a range offered free to academics and/or students using Armstrong’s Handbook of Human Resource Management Practice, 11th edition, as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources.

THAMES VALLEY POLICE PERFORMANCE AND DEVELOPMENT REVIEW PROCESS Key to the performance management strategy Establishes strong employment relationships Provides a route to individual, team and organizational performance planning Secures future training and development provision Creates more visibility for career paths, competencies and behaviours across ranks and roles This resource is part of a range offered free to academics and/or students using Armstrong’s Handbook of Human Resource Management Practice, 11th edition, as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources.

PERFORMANCE MANAGEMENT AT ASTRA ZENECA Stages Business role clarification – clear statement of agreed role and objectives Performance planning – agreement of targets to achieve the ‘plan–do–evaluate’ elements of managing performance Performance development – agree skills required and prepare individual development plan Performance measurement – provide ongoing feedback and an annual summary of an employee’s performance (no overall ratings) This resource is part of a range offered free to academics and/or students using Armstrong’s Handbook of Human Resource Management Practice, 11th edition, as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources.

PERFORMANCE MANAGEMENT AT THE VICTORIA & ALBERT MUSEUM Job description (updated) Evidence (departmental) Corporate plan Evidence (individual) Departmental objectives Performance standards Individual objectives Attributes Personal development plan Ratings – pay decisions Assessment Countersigning officer review This resource is part of a range offered free to academics and/or students using Armstrong’s Handbook of Human Resource Management Practice, 11th edition, as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources.

INTRODUCING AND OPERATING PERFORMANCE MANAGEMENT This resource is part of a range offered free to academics and/or students using Armstrong’s Handbook of Human Resource Management Practice, 11th edition, as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources.

INTRODUCING PERFORMANCE MANAGEMENT Advice from the respondents to the e-reward survey 2005 Dos Don’ts Consult and involve Provide training (formal and coaching) Communicate Get support from senior management Get buy-in from line managers Align to organizational and stakeholder needs Keep it simple Ensure clear purpose and processes Monitor and evaluate Don’t make it too complicated Don’t make it a form-filling exercise Don’t underestimate the time it takes to introduce Don’t keep changing the system Don’t assume that managers have the skills required Don’t link to pay Don’t blindly follow others Don’t neglect communication, consultation and training Don’t assume everyone wants it This resource is part of a range offered free to academics and/or students using Armstrong’s Handbook of Human Resource Management Practice, 11th edition, as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources.

ADDRESSING THE ISSUES ‘Providing full line management briefing, training, guidelines and policies.’ ‘Structured programme of training for managers plus ongoing coaching.’ ‘Senior management insistence.’ ‘Shift in culture from long-term employees that performance management is just something they have to go through but they will be in the job anyway, to a more businesslike approach to performance management, with accountability and competency.’ ‘Generating leadership from the top to support/encourage line managers to tackle poor performance head on in a fair and positive manner.’ ‘Nagging, nagging, nagging, motivating, threatening, etc.’ This resource is part of a range offered free to academics and/or students using Armstrong’s Handbook of Human Resource Management Practice, 11th edition, as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources.

DEVELOPING PERFORMANCE MANAGEMENT SKILLS AT STANDARD CHARTERED BANK Improve how managers manage Management development curriculum E-learning module for key pillars of performance objective setting interim and first review informal discussions performance coaching managing poor Performance coaching guides Studying our best managers and migrating their practices This resource is part of a range offered free to academics and/or students using Armstrong’s Handbook of Human Resource Management Practice, 11th edition, as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources.

INTRODUCING PERFORMANCE MANAGEMENT 7. Pilot test and retrain 6. Train 5. Develop process 4. Communicate and involve 3. Enlist support 2. Define purpose 1. Analyse arrangements This resource is part of a range offered free to academics and/or students using Armstrong’s Handbook of Human Resource Management Practice, 11th edition, as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources.

PERFORMANCE MANAGEMENT – SEVEN QUESTIONS What do we mean by performance? How can we identify good or poor performance? How can we establish the cause of good or poor performance? How can we motivate people to perform well? How do we deal with underperformers? How can we do all this fairly and consistently? How do we achieve line manager buy-in? This resource is part of a range offered free to academics and/or students using Armstrong’s Handbook of Human Resource Management Practice, 11th edition, as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources.

ANALYSING THE PERFORMANCE MANAGEMENT GAP What are the current and desired performance management characteristics in your organization? Performance management fully supported by top management Top management pays lip service to performance management 1 2 3 4 5 6 7 Line managers fully committed to performance management Line managers see performance management as a pointless chore Line managers are fully skilled in There are serious deficiencies in the skill levels displayed by line managers Line managers conscientiously follow performance management guidelines Line managers go their own way, if they do anything There is hard evidence that performance management is improving business performance There is no evidence that Performance management deals effectively with underperformers Little or no action is generally taken to deal with underperformers Employees believe that is fair Employees do not trust their managers to review their performance fairly Mark on the scale: X for current, O for desired This resource is part of a range offered free to academics and/or students using Armstrong’s Handbook of Human Resource Management Practice, 11th edition, as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources.

ANALYSING THE PERFORMANCE MANAGEMENT GAP What are the current and desired performance management characteristics in your organization? Performance management fully supported by top management Top management pays lip service to performance management 7 6 5 4 3 2 1 Line managers fully committed to performance management Line managers see performance management as a pointless chore Line managers are fully skilled in performance management There are serious deficiencies in the skill levels displayed by line managers Line managers conscientiously follow performance management guidelines There is hard evidence that performance management is improving business performance Performance management deals effectively with underperformers Employees believe that is fair Employees do not trust their managers to review their performance fairly O X O X O X O X Line managers go their own way, if they do anything O X O X There is no evidence that performance management is improving business performance O X Little or no action is generally taken to deal with underperformers Mark on the scale: X for current, O for desired This resource is part of a range offered free to academics and/or students using Armstrong’s Handbook of Human Resource Management Practice, 11th edition, as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources.

PERFORMANCE MANAGEMENT GOAL RATING Possible goals Importance Effectiveness Align individual and organizational objectives Improve organizational performance Develop a high-performance culture Improve individual performance Provide basis for personal development Increase motivation and engagement Inform contribution/performance pay decisions Measure performance against quantified objectives Encourage appropriate behaviours – ‘living the values’ Clarify performance expectations in the role Identify potential Identify underperformers Scale: 10 = high, 1 = low This resource is part of a range offered free to academics and/or students using Armstrong’s Handbook of Human Resource Management Practice, 11th edition, as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources.

EVALUATING PERFORMANCE MANAGEMENT – OPINION SURVEY Please indicate how you felt about performance management by recording your reactions to the following statements. Indicate: A if you fully agree, B if you partly agree, C if you disagree   I am quite satisfied that the objectives I agreed were fair. I felt that the meeting to agree objectives and standards of performance helped me to focus on what I should be aiming to achieve. I received good feedback from my manager on how I was doing. My manager was always prepared to provide guidance when I ran into problems at work. The performance review meeting was conducted by my manager in a friendly and helpful way. My manager fully recognized my achievements during the year. If any criticisms were made during the review meeting, they were acceptable because they were based on fact, not opinion. I was given plenty of opportunity by my manager to discuss the reasons for any of my work problems. I felt generally that the comments made by my manager at the meeting were fair. The meeting ended with a clear plan of action for the future with which I agreed. I felt motivated after the meeting. I felt that the time spent in the meeting was well worthwhile. This resource is part of a range offered free to academics and/or students using Armstrong’s Handbook of Human Resource Management Practice, 11th edition, as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources.

INNOVATION IN PERFORMANCE MANAGEMENT This resource is part of a range offered free to academics and/or students using Armstrong’s Handbook of Human Resource Management Practice, 11th edition, as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources.

MANAGING PERFORMANCE AT STANDARD CHARTERED BANK (1) High-performing organization Performance management process Manager–employee interaction Senior management sponsorship Living the values Clear expectations Outcome measures Promote differentiation Emphasize strengths Accurate/fair feedback Regular open dialogue Underperformance not tolerated Knowledgeable managers Two-way communication Managed risk taking Reward excellence Managing performance is critical Manage accountability Talent management Expect excellence Strengths-based Focus on the best This resource is part of a range offered free to academics and/or students using Armstrong’s Handbook of Human Resource Management Practice, 11th edition, as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources.

MANAGING PERFORMANCE AT STANDARD CHARTERED BANK (2) The process Global for all employees Accelerate a high-performing organization Objective setting (January) Financial/business objectives Two core management objectives Values objectives for all Performance coaching throughout the year Regular open discussion Integrates performance, learning and development, reward and individual engagement Addresses performance issues Underperformance not tolerated Final review (Nov/Dec) 1–5 business rating scale A–D values rating scale Additional feedback form Cascaded ‘level down’ rating reviews Interim review (July) Formal step-back ‘Tracking’ rather than ‘rating’ This resource is part of a range offered free to academics and/or students using Armstrong’s Handbook of Human Resource Management Practice, 11th edition, as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources.

MANAGING PERFORMANCE AT STANDARD CHARTERED BANK (3) Employees’ rights To know how well we are doing To know what is expected of us To know what we need to do and learn to improve and progress This resource is part of a range offered free to academics and/or students using Armstrong’s Handbook of Human Resource Management Practice, 11th edition, as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources.

UNILEVER Assessment and action matrix WHAT Inconsistent in meeting expectations HOW Consistently meeting expectations Inconsistent in meeting agreed individual business targets Consistently meets individual business targets Possible actions: reward set milestones provide feedback training coach to improve delivery recognize and reward challenge/stretch expose coach coach/monitor/track decision to continue or end employment mentor/coach to improve acknowledge contribution This resource is part of a range offered free to academics and/or students using Armstrong’s Handbook of Human Resource Management Practice, 11th edition, as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources.

BASIC DESIGN PRINCIPLES – CIVIL SERVICE PERFORMANCE MANAGEMENT REPORT Stretching objectives agreed at the beginning of the year Individuals know the competencies and behaviours they are expected to demonstrate Regular discussions during year between individuals and their managers to discuss progress Formal meeting at the end of the year to record whether objectives have been achieved and levels of competence demonstrated Line managers make a narrative assessment but do not translate this into a box mark This resource is part of a range offered free to academics and/or students using Armstrong’s Handbook of Human Resource Management Practice, 11th edition, as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources.

WHAT MAKES FOR GOOD PERFORMANCE MANAGEMENT: SCOTTISH PARLIAMENT New staff know what is expected of them from the outset Everyone is clear about corporate goals and works towards them Objectives are SMART A system exists to accommodate day-to-day performance feedback Evidence is available to support assessments The personal development plan is used to help self-developmental activities or improve performance The line manager provides and the jobholder undertakes the training needed to support the individual and the organization Appropriate support is in place to eliminate poor performance This resource is part of a range offered free to academics and/or students using Armstrong’s Handbook of Human Resource Management Practice, 11th edition, as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources.

PERFORMANCE MANAGEMENT: KEY CONSIDERATIONS Performance management is about running the business, it is what managers do – a natural process of management Success depends on what the organization is and needs to be in its performance culture It is the process that is important, not the system Focus on development, not pay Base on accepted principles but operate flexibly Effective communication, involvement and training essential This resource is part of a range offered free to academics and/or students using Armstrong’s Handbook of Human Resource Management Practice, 11th edition, as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources.