Page 14 - DMGT517_PERFORMANCE_MANAGEMENT_SYSTEM

Unit 1: Introduction to Performance Management

Notes

Performance Management in TISCO

ata Iron and Steel Company (TISCO), a flagship company of India involved in

manufacturing of cost effective steel can be appreciated for their initiatives in
Tthe implementation of an effective performance management framework and
innovative HR practices. TISCO initiated a management restructuring programme for
transforming into a high performing and a growing organization. In the HR front, the
management focused on providing exciting career opportunities and building a team of
high performing professionals for which they hired Mckinsey and Co. The consultants
firstly started with building a lean and a flat strategic business unit with enriched jobs,

increased accountabilities and autonomy. A Performance Ethic Programme (PEP) was also
introduced for promoting young and dynamic professionals and this was a replacement
of seniority based promotions. A new Performance Management System (PMS) was
introduced for aligning the KRA’s with the business strategies and identifying superior
performers in the organization by defining clear career paths and accountabilities. The

rewards and recognitions were linked with the PMS. The new measures in the direction
of performance management boosted the employee’s motivation and performance. The
job satisfaction also improved due to the introduction of a fair and transparent reward
system.

Source: www.managementstudyguide.com

1.8 Summary

z Performance management deals with improving organizational performance by improving
employee performance.

z The concept of performance management may be categorized into two separate types

of management. The first one deals with the performance of an organization as a whole
and evaluates the effectiveness of its managers. The second one deals with the system of
evaluating employees in order to enable them to achieve reasonable goals and thus ensure
that the organization performs better.

z Performance management is an important organizational tool to clarify performance
objectives, standards, critical dimensions, and competencies to enhance individual
performance.
z Performance management is a ‘systematic’ and ‘holistic’ approach to identify critical
dimensions of performance and to carry out activities necessary to ensure that the mission,
objectives, goals, vision, and values of the organization are being met in an effective and
effi cient manner.
z Performance management transforms organizational objectives and strategy into a
measurable action plan by getting the right information to and from the right people at the
right time and in the right format.

z The use of performance management in the best-practice companies is not because it is a
better technique than performance appraisal, but because it can form one of a number of
integrated approaches to the management of performance.

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