In this postmodule assignment I have chosen to analyse the relevance for performancemanagement in relation to an operational environment familiar to me and tocomment on how this may be used to drive improvements in customer service.Performance managementis a continuous process of identifying, measuring, and developing theperformance of individuals and teams and aligning this performance with thestrategic goals of the organisation. (Auginis 2009, Chapter 1) Performancemeasurement is a fundamental building block of TQM (Total Quality Management)and total quality organisation. TQM is the system of activities directed atachieving delighted customers, empowered employees, higher revenues and lowercosts (Juran and Gryna, 1993).Performancemanagement, when implemented well, can lead to important benefits fororganisations.
Possible outcomes from effective performance management would beclarifying job responsibilities and expectations, enhancing individual andgroup productivity, developing employee capabilities to their fullest extentthrough effective feedback and coaching, driving behaviour to align with theorganization’s core values, goals and strategy, providing a basis for making operationalhuman capital decisions (e.g., pay), improving communication between employeesand managers. Organisationsare aware of the benefits that can be produced by a good performance managementsystem and, consequently, performance management has become popular worldwide.For example, a survey of 278 organisations, about two-thirds of which aremultinational corporations, from 15 different countries, indicated that about91% of organisations implement a formal performance management system (Cascio2006).Whilst there canbe no arguing that long term, sustained profit must be the goal of anycommercial organisation, there is a growing realization that if profit is theend, then we should spend more time examining the means whereby it is achieved.(Martin Christopher) For example, organizations with a formal and systematicperformance management systems are 51% more likely outperform others regardingfinancial results and 41% more likely to outclass others regarding additionaloutcomes including customer satisfaction employee retention and furtherimportant metrics (Cascio,2006). Historically,organisations have always measured performance in some way through itsfinancial performance, be this success by profit or failure through liquation.
However, traditional performance measures, based on cost accountinginformation, provide little to support organisations on their quality journey,because they do not map process performance and improvements seen by thecustomer. In a successful total quality organisation, performance will bemeasured by the improvements seen by the customer as well as by the resultsdelivered to other stakeholders, such as the shareholders. (Slides)The traditionalperformance management methods and particularly performance reviews were notvery effective as the process was designed to emphasise individual accountabilityfor past results. Traditional appraisals give short shrift to improving currentperformance and developing talent for the future. That often hindered long-termcompetitiveness. A solution had to be found and it wasn’t until 2002 changestarted to happen. That was when Brian Jensen a HR executive of Colorcon wasn’tbothering with annual reviews anymore.
This was during his tenure as thedrugmaker’s head of global human resources. In his presentation at the WhartonSchool, Jensen explained that Colorcon had found a more effective way ofreinforcing desired behaviours and managing performance. Supervisors weregiving people instant feedback, tying it to individuals’ own goals, and handingout small weekly bonuses to employees they saw doing good things.