Page 148 - DMGT517_PERFORMANCE_MANAGEMENT_SYSTEM

Unit 12: Performance Management Linked Reward System

by pointing out areas that are strong along with areas that need improvement. Depending on the Notes
workplace, it may be better to evaluate based on subjective or objective criteria or a mix of both.
1. Objective Performance Evaluation: An objective performance evaluation might focus on
an easily measurable number, such as total sales. The “Performance Appraisal Handbook,”
published by the U.S. Department of the Interior, describes some ways to objectively
evaluate employees. For example, employers could measure quantity of work. In this case,
the “Performance Appraisal Handbook” describes quantity of work as “how much work
the employee or work unit is expected to produce. Measures are expressed as a number of
products or services expected.”

2. Subjective Performance Evaluation: For some service jobs, a subjective performance
evaluation, which looks at an employee’s qualities not the quantity of work, might include
how well a certain employee interacts with customers. While quantity of work can be
easily measured, how well a certain employee interacts with customers cannot. Instead,
such criteria rely on observations and opinions.

12.4.4 How do Organizations Reward?

Rewards are given to recognize outstanding work of individuals, teams (units and departments
including) or other connected with the organization. It is important to communicate appreciation
in public. Celebrating achievement in public boosts the value of the reward. Exceptional
performance by the organization, crossing a milestone or launching of a new product etc. may
be celebrated organization-wide with small gifts (the same to all employees, from the top to the
lowest level). A team of 5 to 7 employees (or preferably their wives), from different levels and
locations, may decide the gift to be given.
Based on the “performance” of the units/departments (all units/departments to be rated by a
corporate committee as A,B,C), the units/departments may be given discretionary funds from
the Reward Corpus, to be utilized to reward their employees. The recommendations made by

the unit/department heads, along with justification, should be sent to the Corporate Rewards
Committee. The rewards should be declared by the unit/department heads.
Individuals or team rewards may include monetary rewards, computers, family holiday plans,

stock/share options, declaration in the newsletter, medals and certificates (to be given in a
function by Unit/Department Head/CEO, also a person who collects four medals or so may be
given some intrinsic/extrinsic reward), visit to other plants, visits abroad etc.
Survey of customer satisfaction, internal customer satisfaction and employee satisfaction, may
preferably be conducted by internal or external team (say by short placement IIM/IIT/other
institute graduates). Survey forms may be developed by a Task Force, reviewed and fi nalised.

1. Empowerment: One way to reward people is to empower them, giving them autonomy
with support to act in relation to their work.
One good example is the public sector undertaking, BPCL, which reorganised itself and
gave more freedom to people in the fi eld.

Example: Territory managers in retail can award jobs up to `2 crore or take action
against errant dealers. In Philips Software Centre 70-80% vacancies get filled by employee

referrals. Wipro Spectramind has a programme CONTACT (Cutting Out New Talent
Activity) for employee referral.
2. Recognition: Recognition is the greatest reward.

Example: 1. Texas Instruments, rated no.1 Great Places to Work in India,
recognizes people by electing them as TI Fellows, one of the highest steps on the technical
ladder.

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