The Performance Management

Question: Write an essay onThe performance management. Answer: The performance management is a vital function of the human resource department. It deals with the evaluation of the work performances of the employees and the adherence of the work benchmarks. It is necessary for the organization to evaluate the number of actual productive manpower. It is also helpful for the employees to determine the level of their performance and the areas for improvement. This report aims to describe the detailed approach of performance management. The organization Westpac Banking Corporation is chosen for the purpose of the study. The report aims to improve the understanding of the current performance management practices in Westpac. The report also gives suitable recommendations for the improvement of the performance management function. Introduction The Human Resource Department is an important section of the organization, which deals with the manpower of the organization. The employees of the organization are important since they determine the success of an organization. The report describes the Performance Management process in Westpac Banking Corporation, in Australia (Westpac.com.au, 2016). It is one of the big banks of Australia and has gained immense popularity since its inception. In this report, the performance management function of the selected organization is done. The detailed review of performance dimension in the organization is done. The current practices are identified and suitable recommendations are being done so that the performance management dimension of Westpac can be improved. The report also identifies the capabilities of the Performance Managers required for successful implementation of the laid down recommendations. Westpac Banking Corporation is also known as Westpac. It is a financial services provider and Australian Bank, with its headquarters located in Westpac Place, Sydney (Westpac.com.au, 2016). The bank is among the big four banks of Australia (Westpac.com.au, 2016). The Bank serves worldwide customers and has got 1429 branches and 3850 ATMs (Westpac.com.au, 2016). The major products of the company are consumer banking, finance and insurance, investment banking, global wealth management, mortgages, private equity, credit cards and others (Westpac.com.au, 2016). The annual revenue of the company was AED 21.642as recorded in the financial year 2015 (Westpac.com.au, 2016). The net income of Westpac was AED 8.012 billion in the year 2015 (Westpac.com.au, 2016). Workplace-based projects The business world is dominated by two approaches- Inside Out approach and Outside-In approach (Tyson, 2014). The two approaches use different ways to achieve the end objectives. The inside-out approach believes in the fact that the success of the organization depends on the inner capabilities and strengths of the employees of the organizations. This approach makes effective utilization of the human resources of the company. The approach identifies the core competencies of the employees, which help them to satisfy the external stakeholders. The inside-out approach comprises of strategies, which believe that the company achieves greater operational efficiency by the implementation of this approach. The implementation of this approach helps the organization to adapt itself to the changing environments. The Human Resource strategies deal with the policies as well as practices of the human resources and its integration with the organizational strategy (Berman et al., 2015). The purpose of the HR strategy is understood how the organization perceives its human resource practices (Bamberger, Biron Meshoulam, 2014). The HR strategy should be prepared as per the needs of the particular organization. The inside-out approach deals with the human resources function like skills, technologies, processes and others. The approach also seeks to identify the linkages of the human resource functions to the business strategies of the organization (Bamberger, Biron Meshoulam, 2014). The business strategy usually revolves around the people issues and its implications. Concept of Performance Management The process of planning, monitoring, reviewing the work objectives of the employees of an organization and analyzing the accomplishment of the same is known as performance management (Van Dooren, Bouckaert Halligan, 2015). The employees of the organization are assigned specific job roles to perform, which is based on the broad objectives of the organization. It is the duty of the human resource managers to ensure that the employees are conforming to the set job roles. The employees should be able to achieve the given targets and milestones in their job responsibilities. The organization constantly measures the performance of the employees after a fixed period (Bao et al., 2013). The employees should be able to achieve the set minimum requirements for the job position. The employees can achieve more than the basic requirements specified in the job role (Bamberger, Biron Meshoulam, 2014). In such a case, they get rewarded by various methods by the HR department, which would be discus sed in the later stages of the report. The performance management is the constant procedure of setting benchmarks, assessment of the progress and providing sufficient coaching to the employees so that they can improve themselves (de Waal, Kourtit, 2013). The ultimate motive of the human resource department is to help the employees grow and achieve their full potential. Performance Appraisal The systematic evaluation of the performance of the employees, so as to understand the capabilities of a person for further growth and development is known as performance appraisal (Iqbal, Akbar Budhwar, 2015). The objective of performance appraisal is the identification of the employees strengths and weaknesses so that the right person is present in the right job. The appraisal is also done to assess the inherent potential in the employees and any requirement for training and development (Armstrong, Ittner Larcker, 2014). The management can maintain the official records of the employees, which would help them in determining the wage structure, compensation package and increments. There are certain advantages of the performance appraisal process (Aggarwal Thakur, 2013)- Promotion- The performance appraisals help the managers to design promotion packages for excellent performances (Bednall, Sanders Runhaar, 2014). The promotion may be an increase in the designation, additional job tasks, and others. Compensation- The appraisal process helps the managers to design suitable compensation packages as per the merit ranking. The compensation package includes basic salary, bonus, extra benefits, perks and others (Madan Bajwa, 2016). Selection Validation- The performance of the employees gives an idea regarding the success of the selection process, carried out by the human resources department (Iqbal, Akbar Budhwar, 2015). Development of the employees- The performance of the employees gives an idea regarding the training needs of the employees (Armstrong, Ittner Larcker, 2014). The appraisal helps in analyzing the strengths and weaknesses of the employees, which is essential for designing the training schedules. Role of Human Resource Department The human resource department plays a vital role in shaping the work performances of the employees (Kehoe Wright, 2013). The human resource practices and policies can have a direct impact on the performance of the employees. The employment engagement activities of the organization make the employees happy, which in turn increases their commitment and zeal to work (Armstrong Taylor, 2014). They become motivated, and there is a considerable increase in their productivity. The higher productivity levels of the employees are reflected in the enhanced customer service, which increases the customer satisfaction levels. It is the responsibility of the human resource manager to foster an organizational culture, which encourages the optimum performance of the employees (Bratton Gold, 2012). The high performance of the employees should be reflected in areas such as quality of performance, levels of customer service, increased productivity, profit generation and finally the enhanced delivery of increased value of shareholders (Kehoe Wright, 2013). The human resource department should strive to empower the employees, in such a way, that they exhibit excellent performance, which is associated with a higher business (Davenport, 2013). Methods of Performance Management in Westpac Westpac believes that the ability to achieve the organizational goal is possible due to the contribution of each employee of the organization (Westpac.com.au, 2016). This implies the importance of the effective management of performances of the employees. The Bank undertakes three steps in setting the objectives and analyzing the performance of the employees (Westpac.com.au, 2016). The three stages are- Formulation of specific expectations from specific job roles, thorough assessment of the performance of the employees and rewarding the employees who have demonstrated exceptional performance (Westpac.com.au, 2016).The formal appraisal process matches the level of performance of the employees against the requirements of the role. The Bank not only measures the performance of the employees but also analyses their behavioral aspects and attitude demonstrated in the workplace (Westpac.com.au, 2016). The Bank conducts the appraisal process twice every year (Westpac.com.au, 2016). There are also quarterly review processes in some business areas. The final performance rating is the foundation for salary hikes and increase of the variable remuneration (Westpac.com.au, 2016). The employees who have demonstrated exceptional levels of performances are rewarded (Westpac.com.au, 2016). The employee rewards can be promotions, pay hikes, paid vacations, increase in variable pay and other facilities. Performance Appraisal at Westpac The company uses a combination of the performance appraisal processes for evaluating the performances of the employees (Westpac.com.au, 2016). The first approach used is the Behavioral Checklist process (Boachie-Mensah Seidu, 2012). This process comprises a list of criteria, which should be followed by the employee to become a diligent employee. This method is considered favorable for situations when there is a need for checking the performance of the employees without comparisons. The second and the most common approach is the 360-degree appraisal (PotoÄ nik Anderson, 2012). This type of appraisal takes into consideration the feedback from all the stakeholders who come in contact with the concerned employee. The various types of stakeholders are the supervisor, manager, peers, team members, vendors, external suppliers, direct juniors and others. This type of appraisals takes into account the complete profile of the employee. The in-depth feedback of the employee is gathered and assessed accordingly. The third type of performance appraisal concerns with the Management by Objective (Uduji, 2013). This method is considered as the modern approach to performance appraisal. In this method, there is an agreement between the employee and the manager over specific and attainable goals, within a given deadline. The performance of the employee is measured at the end of the set period (Cherian Jacob, 2013). This method is useful as the appraiser can define failure and success easily. Consequences of Performance Management in Westpac The performance management procedure in Westpac is followed by a four step ordeal, which starts when the Bank finds out that a particular employee is unable to fulfill the set minimum standards of their job roles, and their demonstrated performance is not acceptable (Westpac.com.au, 2016). Step 1- The immediate manager of the employee engage in a face to face conversation with the concerned employee. The various aspects of the performance are discussed in the meeting. The communication process is a mutual process, in which both the employer and the employee, shares their individual point of views (Westpac.com.au, 2016). The manager shares the performance level of the employee in the period of review. He also explains that how the performance has not met the expectations of the company (Westpac.com.au, 2016). The manager shares that such under performance is not desirable from an organizational point of view. The employee also shares the reasons for low-performance level and any external factors that have been instrumental in this process (Westpac.com.au, 2016). The manager highlights the areas that the employees need to focus on, to improve the productivity levels. Step 2- The concerned employees undergoes informal coaching and suitable training programs that address the areas for development. The topics of the training can range from skill development to work related skills (Westpac.com.au, 2016). There is alsoa need to enhance the soft skills of the employees and improve the technical expertise needed to perform a specific job role. There are proper planning procedures regarding the training procedures of the underperformers. The training schedules are designed in such a manner so that the current performance of the employees is not affected (Westpac.com.au, 2016). For example, the training of the employees should not be carried out during the duty hours, which may further deteriorate the performance of the employees. Instead, the training programs of the employees should be carried out after duty hours or over the weekend, whichever is most suitable. The manager reviews the output of the training programs regularly (Westpac.com.au, 2016). In case the training outcome is not up to the mark, then necessary changes are made in the training schedule. Step 3- The Bank evaluates the performance of the employees post the training programs. If the employee has successfully achieved the objectives of the training program, then the coaching program is continued, and there is an ongoing assistance provided to the employees. The aim of the company is to provide handholding support for capacity building of the employees (Westpac.com.au, 2016). The human resources team of the Bank has a policy, which states that if there is a reoccurrence of the unacceptable performance of the particular employee within six months, then the employee could face dismissal (Westpac.com.au, 2016). Step 4- In the event of the repeated unacceptable performance of the employee, the Bank formally announces the same to the concerned (Westpac.com.au, 2016). The Bank provides one last opportunity to rectify the performance of the employees by providing them workshops and training modules. At the end of the training period, the employee may be demoted, dismissed or forced to give resignation. Recommendations There is a need to improve the present scenario of performance management. The employees should be presented with the opportunity to assess themselves. The employees should be given a copy of the Performance Appraisal Form so that they can evaluate their performance. This is helpful as it would allow the opening of the channels of the communication between the manager and the employee. The manager should be an excellent communicator who would be able to discuss any differences in opinion more easily and compare the two sets of evaluation for better evaluation (one form filled by the manager and the other filled by the employee). The manager should have excellent analytical skills. He should strive to gather information regarding a specific employee from more than one source. The unconventional sources should be utilized to gather an unbiased source of feedback The performance appraisal process should be followed by an open discussion with the concerned employees. The manager should have convincing skills so that he can make the employee understand the linkage of his performance with the vision of the company. The employee should be shown a "bigger picture" to make him understand the importance of his individual role in the organization. The employees who display excellent performance should be rewarded with promotions, higher packages, and others so that the employees are constantly motivated. The motivated employees would prove to be productive workers. Conclusion The performance management function is an important job of the human resource department. The performance appraisal is crucial for maintaining an optimum level of motivation among the employees. The human resource department is responsible for managing the performance of the employees. They are responsible for guiding the employees and help them achieve their optimum performance. The employees are motivated if they receive high salary and high positions in the workplace. The organization also needs to know the efficient employees and the employees who require training. The performance management of the employees is done for letting the employees know about the expectations of the organizations from them and find out suitable ways for fulfilling the same. The performance management needs to be done for aligning resources of the organization to achieve the organizational goals. Westpac has good performance management system; however it needs to be improved for optimum benefits to the o rganization. The quality of the human resources should be improved to achieve success for the organization. References Aggarwal, A., Thakur, G. S. M. (2013). Techniques of performance appraisal-a review.International Journal of Engineering and Advanced Technology,2(3), 617-621. Armstrong, C. S., Ittner, C. D., Larcker, D. F. (2014). An Exploratory Investigation of the Determinants and Ratings Implications of Performance Appraisal Plan Characteristics. 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