Page 163 - DMGT517_PERFORMANCE_MANAGEMENT_SYSTEM

Performance Management System

Notes capital of the organisation. Effectiveness dimensions provide qualitative insights essential
for making fruitful decisions on the part of the stakeholders.
Stakeholder Advantage

While efficiency-focused measurements of the performance management system may

benefit the HR function or department, key stakeholders like the employees themselves
and their managers do not stand to gain anything from this level of measurement. To that

extent, efficiency-oriented measurements become “pseudo measurements” that do not
deliver any value.
I propose a more complete ‘assessment model’ for assessing an organisation’s performance
management system. While there can be many other frameworks, I describe the one that
we at Symphony Services follow. This has helped us get the maximum benefi t for all the
stakeholders involved, in leveraging the developmental tool of the appraisal system.
The Staircase Approach

The staircase model combines both the efficiency and effectiveness required of a good
appraisal system, ensuring that the system delivers the intended benefit. The approach

covers the holistic perspective for measurement.
Level 1 – Process compliance: Most organisations measure the effectiveness of their
performance management systems at this level. Process compliance refers to satisfying
a check-list of parameters relating to system implementation. This check-list includes,
amongst others, adherence to timelines while goal-setting; quarterly, mid-year or annual
reviews; and signatures of employees appraiser and reviewing managers and HR as the
system may warrant.
Level 2 – Content completeness: In some organisations, the HR function takes the
measurement to the next level by either randomly or entirely checking the appraisal
documents. This ensures that the employee, appraiser and the reviewing managers have

filled out the form in detail. If a manager has not done a good job, HR sends the appraisal
document back. The manager is also invited to go through a refresher module so that the
nuances and seriousness of doing a comprehensive appraisal is understood for the future.
Level 3 – Vitality curve analysis: Mature organisations go beyond levels 1 and 2. They also
do a detailed analysis of the employee distribution in terms of their rating category and
draw up a “vitality curve” or what is popularly known as the “bell curve.” The vitality
curve and accompanying analysis helps organisations segment talent, which is the fi rst
step towards creating a high-performance culture besides identifying a slate of high-
potential candidates when viewed along with a robust potential identifi cation process.
Talent segmentation is also necessary to tailor specific development actions.

Level 4 – Employee experience: At this level, HR partners the different business units
within an organisation to measure the employee’s experience with the appraisal review
process. This involves choosing randomly 12 to 15 per cent of the employees and asking
them questions on their experience with the performance management cycle. The focus is
on the quality of the appraisal review session, the quality of the dialogue, the manager’s
willingness to receive feedback and the nature of the discussions around developmental
actions and the like.

While levels 1 and 2 represent the efficiency focus, levels 3 and 4 make up the effectiveness
focus of the measurement of the performance management system. Interestingly, the
higher levels of measurement in the staircase model do not call for sophisticated tools.
Well-trained HR partners and those responsible for HR analytics can do this with ease.

Contd....

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