Strategic Performance Management Flashcards
what is performance management
- is a continuous process of identifying, measuring, & developing the performance of human resources in an organisation by linking each individual’s performance & objective to the organization’s overall mission & goals(individual goals & objectives को लिंक करना organisation overall goals ओर objective ke साथ)
What are the elements of performance management
• continuous process :
-performance management is ongoing.
- it involve never ending(कभी भी न खत्म होने वाला)process of setting goals & objectives, observing performance, and giving & receiving ongoing coaching & feedback ( देना और recieve करना ongoing coaching & feedback)
Link to mission & goals:
Performance management require managers to ensure that employees activities & output are congruent (suitable for something) with the organization’s goal & consequently, help organisation gain a competitive business advantage.
Difference between performance management & performance appraisal
1) PM - comprehensive approach
PA - narrow & limited approach
2) PM - flexible process
PA - monolithic system
3) PM - usually not directly linked to pay.
PA- often linked to pay
4) PM - documentation are kept to minimum.
PA - involve complex paper work
5) PM - owned by line managers
PA - owned by HR department
6) PM - focuses on values, behaviour, & objective
PA - focuses on quantified objectives
7) PM - use of rating is less common.
PA - rating is frequently used
8) PM - focuses on present & future
PA - focuses on past
9) PM - strategic tool
PA - operational tool
10) PM - approach is holistic
PA - approach is individualistic
11) PM - it is a process
PA - it is a system
What are the components of performance managment
Performance planning :
- first crucial component of performance management process
- done jointly by appraiser & the reviewer at the beginning of performance session.
- employee decides upon target & the key performance areas which can be performed over a year within performance budget which is finalised after mutual agreement between reporting officer & the employee.
- organisation use BSC KPI down the hierarchy so that each employee is responsible for definite result
Performance appraisal & reviewing :
- appraisal is done twice a year in an organization in the form of mid review & annual review which is held at the end of each year.
- appraiser first offer self filled up rating in self appraisal form & also describe his or her achievement over the period of time in quantifiable term. After self appraisal final rating is provided by appraiser, entire process of review seek active participation of both employee & appraiser for analysing the causes of loopholes in the performance & how it can be overcome.
Feed back on the performance followed by personal counseling & performance facilitation :
- feedback & counseling are given a lot of importance in the performance management process.
- in this stage employee acquire awareness from the appraiser about the area of improvement & also the information on whether the employee is contributing to the expected level of performance or not.
-employee receive open & very transparent feedback alongwith this training & development need of employee is also identified.
Rewarding good performance:
- during this stage a employee is publicly recognised for good performance & is rewarded.
- this stage is very sensitive for employee as this may have direct influence on the self esteem & achievement orientation.
Performance improvement plans :
- a fresh set of goals are established for an employee & a new deadline is provided for accomplishing those objectives.
Potential appraisal :
- forms a basis for both lateral & vertical movement of employee.
- it is performed by implementing competency mapping & various assessment techniques.
- provide crucial inputs for succession planning & job rotation.
What is productivity
Productivity examines करती है relationship of output & input in a given production process. It does not merely define( वह सिर्फ define hi नही करती) the volume of output but output obtained in relation to resources employed.
Productivity = output / input
Productivity can be increased in following ways :
- by producing more output with the same amount of inputs.
- By using fewer inputs for same amount of outputs.
Highest productivity is achieved when maximum output is obtained for a particular input level, increasing efficiency also raises productivity, if productivity growth of an organisation is higher than of its competitors that firm perform better & considered to be more efficient.
What is efficiency
Ability of a firm to obtain maximum output from a given set of inputs. Efficiency is a measurable concept. It minimises waste of resources such as material, labour, energy, time while accomplishing the required output.
Efficiency has two component :
a) Technical efficiency:
it occur if a firm obtain maximum output from a set of input.
b) Allocative efficiency :
It occur when a firm use optimal combination of inputs at a given level of price & production technology.
When a firm fail to choose optimal combination inputs at a given level of prices it is said to be allocatively inefficient though it may be technically efficient.
Technical & Allocative efficiency combine to provide overall efficiency. When a firm achieve maximum output at a particular input level,with utilisation of inputs at least cost is considered to be an overall efficient firm.
Efficiency analysis is not only important for institutions themselves but also for other interested parties such as regulatory authority & general public.
How productivity & efficiency can be measured
In case of a firm that produce single product, ratio of output to input is a measure of productivity. But in case of many output & inputs in a production process measurement of output - input ratio is difficult.
In general productivity & efficiency can be measured on partial factor & total factor basis -
Partial factor productivity:
change in output owing to the change in the quantity of one input.
Total factor productivity:
Change in the output owing to the change in the quantity of more than one input.
Example of PFP - material yield, output per man hours.
Example of TFP - ROI, profitability index.
The output is only measure of joint power of inputs to achieve results, this is the main disadvantage of measuring productivity & efficiency in PFP approach, to overcome this shortcoming TFP is developed. It measure overall productivity & efficiency by considering all inputs & all outputs in the production process
What is performance
Performance is derived from a word called porfourmen, which means to do, to carry out, to render. In broader sense it refers to the degree to which achievement is being or has been accomplished.
In business sector performance means improving all factors that increase the profit. In public sector performance is about how one maximises the quality, scope & timeliness of one’s service delivery while minimising the inputs that are required.
Hence performance is product of :
Efficiency* utilisation* productivity
