PERFORMANCE ASSESSMENT

1
PERFORMANCE ASSESSMENT
Sunirmal Sen HCL Technologies
2
Managing talentand developing anemployee value
proposition
3
Companies must therefore make talent management
a top priority - create and continuously refine
their employee value proposition, and source and
develop talent systematically.

- McKinsey
Co.
The war for talent is on.
4
Big-ticket salaries, stock options and perks like
concierge services, flexible schedules,
sabbaticals, mortgage payments, even an
interesting careerpath and a fun environment
5
are no longer good enoughfor young people!
Source Stanford Business School Magazine
6
So, what makes employees tick,and how to develop
anemployee value proposition?
7
Few Challenges.

• The changing workplace
• The ethical dimension
• Creating a retentive organisation
• An understanding of employee behaviour
• What do they seek?
• What makes them stick? What makes them leave?
• Developing an employee value proposition

8
The changing workplace and the need for newer
communities
9
Some beginnings

• Infosys has a rock band that plays at their
  amphitheatre and at outside concerts
• Organisations have started initiatives like
• Film clubs that hold screenings every month,
• Knowledge sharing forums
• Job referral programmes such Frito Lays Bring a
  Friend to Work
• Blogs

10
(No Transcript)
11
The implication

• The firm of the future has an opportunity to be
  the nexus of communities of practice that attract
  the best human capital, and to create an
  environment in which they build superior
  knowledge assets
• This can give it a competitive edge vis-à-vis the
  talent market, both internal and external

12
A post-Enron world and the importance of being
good
13
Ethical is sexy

• The fall of Enron, WorldCom, Arthur Andersen and
  travails of others like the Interpublic Group,
  has brought the issue of ethics in business to
  the fore
• In a Stanford-conducted survey of 800 MBAs from
  11 leading business schools in the US and Europe,
  ethics figured third most important criteria for
  the choice of an employer, after intellectual
  challenge and financial package
• As many as 97 respondents were willing to take
  an average cut of 14 in compensation, to work
  for a company with a good reputation for ethics
  and CSR

14
WeGen is the new GenNext

• A recent Newsweek study has shown that the youth
  across Asia is increasingly motivated by a desire
  to make a difference rather than just make money
• It talks about a generation thats far more
  inclusive and socially conscious than its
  individualistic predecessor
• Its a marked change from the I-Me-Myself
  image of youth commonly stereotyped in media

15
Creating a powerful ethics-driven corporate brand

• Infosys has consistently been rated as one of the
  most respected companies and sought-after
  employer
• While its rapid growth and stellar performance is
  part of the reason for this perception, its
  differentiator is clearly its ethical, caring
  reputation
• From the image of its leader, to the many stories
  that surround the company (e.g. how the income
  tax officials accept tax returns from the company
  without even checking them) contributes to this
  image
• Tatas or Wipro also enjoy an ethical image, but
  its Infosys that scores a top-of-mind
  association on this parameter
• The learning is clear it is not just sufficient
  being principled one must be seen to be
  principled by the concerned publics

16
The implication

• Its clear that for a company to be attractive to
  potential employees, as also for it to give a
  sense of pride to its existing employees, it has
  to have ethics at its core
• It is not just about compliance, but issues such
  as a concern for its stakeholders, commitment to
  environment sustainability, making of products
  and services that are ethically sound

17
UnderstandingLoyalty Vs. Attrition
18
What does young talent seek?

• The new age workforce mostly comprises knowledge
  workers, who are techno-savvy, aware of market
  realities, are materially focussed and have
  higher propensity to switch jobs
• They prefer to experiment and explore new
  opportunities, are high risk takers with high
  aspirations and expectations

19
What does young talent seek?

• I want to work only with start ups with a good
  business model
• In deciding whether to join this company, I used
  the late-night office test - did I want to be
  working with these guys at the office at 11 at
  night?"
• I want a job with real impact
• I like it here because they appreciate my
  different-ness

20
What makes employees stay?

• The companys brand image
• Compensation package
• Role and position
• Quality of colleagues
• Scope for growth and professional development

21
What makes them leave?

• Anxieties and apprehensions arising from
• Restructuring, movements, change of boss, change
  of tasks and responsibilities
• Marginalisation, power politics
• Mergers and acquisitions
• Better opportunities outside

22
What makes them leave?

• Although most people tell HR they are leaving for
  more money or a better opportunity, 88 change
  jobs because of negative factors in their current
  workplace, ranging from sub-par people management
  to toxic culture

Source McKinsey Co.
23
If managing retention in the past was akin to
tending a dam, today it is more like managing a
river. The object is not to stop water from
flowing but to control its direction and speed.

- McKinsey Co.
24
Different strokes for different folks
Mitigate Retention / Recruitment Policies
Star Employees Convert to Power Change Agents

• Solid PROs
• Invest Encourage

E D U C A T E
E D U C A T E
Invest to classify 1. Can be Changed 2. Cant be
changed
Change
C H A N G E
25
Retention needs managinginternal forces
Minimise
Maximise
Source TCS study
26
An employee value proposition is a carefully
configured mix of multiple factors
Culturalfactors
Transformationalfactors
Transactional factors
Source TCS
27
Performance Assessment What does it do
conventionally

• Assessing Performance / Potential
• Determination of Bonus / Merit Payments
• Promotion decisions
• Setting work Objectives
• Transfer Decisions
• Feedback on Performance Self Development
• Workforce Succession / Career Planning
• Identification of Training Needs
• Legal purposes
• Review / update job description
• Validation of HR Practices
• Communication of Organisation Objectives and / or
  Values

28

Performance Assessment What should it do

• Any Change in Nature increases ENTROPY
• Antidote to ENTROPY
• Arrest disorderly behaviour

29
Performance Assessment What should it do

• To ensure seamless integration between
• People
• Expectations
• Competence
• Attitude
• Potential / Creativity
• Performance
• Process
• Business Processes
• Employee Processes
• Customer Service
• Vendor Management
• Technology
• Communication
• Manufacturing
• Transportation

30
Performance Assessment Objectives

• Assessing Impact of Change in the Organisation
• People
• Process
• Technology
• Planning work and setting Goals Targets
• Drill Down Expectations
• Drill Down Goals Targets
• Continuously Monitoring performance
• Measuring Competence, Performance
• Ongoing Feedback
• Developing capabilities competence of people
  to perform
• Education
• Training
• Job Enrichment

31
Performance Assessment Objectives
32
Performance Assessment is not Annual Appraisal
Alone

• The process of creating sustaining a work
  environment in which people are enabled to
  perform to their fullest potential. Performance
  Appraisal is only a part of it.
• INCLUDES
• Developing precise role / responsibility
  expectation for the position
• Selecting the right people with appropriate
  skills competencies
• Negotiating accomplishments-based performance
  standards, outcomes and measures
• Providing effective orientation about company,
  products, processes customers
• Providing on-going coaching and feedback
• Identifying developmental needs extending
  appropriate education training
• Conducting performance potential assessment
• Rewarding contribution of people through
  appropriate compensation recognition
• Enhancing career development opportunities
• In the era of knowledge work and knowledge
  worker, where work is information based and
  working is a mental activity, the task of
  management is to enable and elicit employee
  contribution of value to the organisation. To
  continue with a system designed to extract and
  enforce compliance is a folly.

33
Performance Assessment applies not only to
Employees

• Simultaneously
  focuses on
• Organisation
• Department Sales, Manufacturing, HR
• Teams or Work Groups to accomplish a result
• Projects Setting up a new plant
• Products or Services to external internal
  Customers
• Programs implementing a new incentive plan
• Processes Budgeting, Product development

34
Eight Steps of the Performance Assessment Process

• STEP 1 Study the Organisation / SBUs Business
  Plan, Goals Objectives
• STEP 2 Determine Units Accomplishments using any
  or all following Methods
• Goal Cascading Cascade the SBUs goals to the
  Unit / Branch
• Customer-Focused Determine product(s)
  service(s) the Unit/Branch provides to its
  customers
• Work Flow Chart Develop a work flow
  establishing key/critical steps in work process
• STEP 3 Determine individual Accomplishments that
  support work Units Goals Chart each job
  position or member of the unit and against each
  list expected accomplishments that the job/member
  must achieve to support the Units goal
• STEP 4 Convert expected Accomplishments into
  Performance Elements indicating priority Some
  critical to achievement of Goals others
  elemental
• STEP 5 Determine measures/criteria of Performance
• - For each performance element, determine
  general measures quantity / quality /timeliness
  / cost etc unit of measurement. For
  non-quantifiable accomplishments determine
  observed verified factors
• STEP 6 Develop Standards of Assessment/Evaluation
• Setup standards for each performance element
  corresponding to rating standards, in numerical
  terms. If not possible, define what the appraiser
  would observe report against each rating
  standard (OS to Poor)
• STEP 7 Determine how to Monitor Performance
• Determine what supporting data would be
  collected, from where, how and in what
  frequency.
• STEP 8 Give periodic feedback to Employees
• Specially in critical areas

35
Setting Goals the SMART WAY

• Set SMART Goals
• S Specific. Also Stretch, systematic,
  synergistic,significant solid
• M Measurable. Also meaningful, memorable,
  motivating magical
• A Achievable. Also agreed-upon, accountable
  action-oriented
• R Relevant. Also realistic, reasonable,
  result-oriented rewarding
• T Time-based. Also target-oriented, tangible
  thoughtful
• Tips on Goal Setting
• Deeply desire your goal
• Own your goal, it is yours
• Base your goals on your values
• Believe you can accomplish your goal
• Be committed to the achievement of your goal
• Develop an action plan for achievement of your
  goal
• Share your goal with people who are important to
  you
• Periodically revisit your goal and realign, if
  necessary

36
Methods Tools Of Evaluation

• PRINCIPLES
• View evaluation of performance potential as a
  valuable management tool
• Ensure acceptance of the evaluation concept
  process, irrespective of the evaluation
  method/tool used
• Evaluate what is important relevant Not what
  is easy to measure
• Develop an evaluation system/method which is
  flexible alive to changes in the context
  environment
• Multiple methods of evaluation/assessment
  provides an overall comprehensive perspective
  of performance
• TYPES OF ASSESSMENT
• Annual Performance Appraisal - Pre-confirmation
  Assessment
• One-to-One Review Discussion - On the Job
  Observation/Assessment
• Skill or Job-related Tests - Review of specific
  Assignment/Project
• Balance Score Card - 360 Degree Assessment
• Assessment Centres (group exercises,
  psychometric tests, presentations etc)
• Human Resource Review
• Self Appraisal

37
Balance Score Card
Complexity of managing business organisations
today requires managers to view assess
performance simultaneously in different
perspectives gt
Measurement of both process results Balanced
Score Card is a management system that converts
an organisations vision strategy into a
comprehensive set of performance and action
measures towards achieving strategic objectives
38
Developmental Perspective Of Performance
Assessment

• When the assessed / appraised performance
  does not meet the desired Performance standards,
  Developmental Plans prepared to address the Gaps
  in performance
• A Developmental Plan can be initiated to address
  following situations
• Gap in meeting the performance standards set
• Gap in competencies to meet the growth
  aspirations of people
• Gap in competencies to meet the growth plans of
  the organisation
• Part of Succession Planning to help employees to
  acquire required competencies

39
Performance Assessment What do we achieve

• Aligns organisational activities processes to
  the mission vision
• Continuously focuses on results, rather than
  behaviour and activities thus depersonalises
• Supports internal communication through on-going
  feedback dialogue
• Performance Assessment seen as on-going process ,
  rather than periodic snapshot event
• Provokes focus on customers, whether internal or
  external
• Produces specificity in commitment resources
• Provides specificity for direction planning

40
Performance Assessment What do we achieve
Newtons First Law of Motion Everybody
continues in its state of rest or of uniform
motion in a straight line until unless
compelled by an externally impressed force to
change that state

• Performance Assessment
• Creates the Motion
• Generates Acceleration
• Sets the Direction
• Validates Processes

41
Challenges Of Performance Assessment

• Believe that PA is NOT HRs Baby
• More more emphasis on HOW than WHAT
• Align the System with changing market demands
• Define unambiguous CSFs KPIs
• Make it a Continuous Process rather than a
  Periodical Ritual
• Define appropriate measurement criteria to ensure
  elimination of subjectivity
• Develop Action Plan based on the outcome of the
  Exercise
• Review Revise the Process, as when required