Framework for Key Performance Indicator & Annual ...

Copyright © Urusharta Jamaah Sdn Bhd. All rights reserved. [1]Private and Confidential Copyright © Prokhas Sdn Bhd. All rights reserved.

Framework for Key Performance Indicator &

Annual Performance Appraisal

15 October 2021

Private and Confidential

Copyright © Urusharta Jamaah Sdn Bhd. All rights reserved. [2]Private and Confidential

The establishment of individual KPI Report for 2021 shall serve as a guide and indicator to this year’s overall

progress for UJ and acts as a precedent for the years ahead.

The Scorecard is prepared to highlight the performance of the management team and each division at the Company

in meeting its key deliverables and as a basis to support the decision-making process of the Board of Directors to

determine the performance-based bonus/incentives for consideration.

Introduction & The Process

KPI Process Development and Timeline

Formulate Company

KPIs as part of Annual Business

Plan

Alignment of Headline KPIs and Divisional

KPIs

Submission to the Board as

part of the Business Plan

Board & MOF’s

approval

Cascading KPIs to every

individual

Perform Half Year Review &

Feedback

Annual Appraisal

Nov Nov Nov Dec Jan June March

Diagram 1:

Diagram 1 above illustrates the cycle for Annual Performance Appraisal moving forward.


KPI Process Cycle

• Formulate KPIs based on UJ’s Strategic Plan

• Account for feedbacks from the Board of Directors and Ministry of Finance Incorporated

• Align with the Company’s overall mandate by the government and the Company’s overriding strategies

Annual Business Plan & Budget

• Refinement of KPIs, taking into account stakeholders’ expectations

• Each Department/Division’s KPI is streamlined to ensure that it synchronizes with the Company’s KPI as approved by the Board and MOF

CEO Review

• Annual Communication

• Formalization of KPIs

• Half-year review

• Annual Review

Implementation


Ensure that you gather the following information before you start the journey:

Points for consideration: Gather Foundational Information

Prepare list of accomplishments

List down all your accomplishments, successes and challenges faced throughout the year as this will help both you and your

supervisor in getting a broader overview of your performance to avoid being biased by recent events, and to provide a clearer

picture on how to move forward

How to? IdentifyDon’t get

trapped

▪ Capture the "how" too and not

just "what" you accomplished.

▪ Identify any challenges that

limited your abilities to

accomplish the agreed goals.

Don't get caught in the trap of

focusing only on the last fewmonths of performance.


• Design a set of relevant performance indicators directly derived fromthe Company’s strategy

Design

• Be well defined, avoiding or reducing subjectivity

• Be both, actionable and measurable

• Ideally, measure outcomes rather than inputs

• Adopt SMART principle as outlined in page 4

Performance Indicators

• Performance indicators must be cascaded-down to lower levels of theorganisationCascading KPIs

• Selectively allow revision of targets in cases where the externalenvironment has fundamentally changedReview

• Performance benchmarked against peers of similar size FundManagement companiesBenchmark

Delivering Corporate KPIs Results


As a refresher, the following is UJ’s FY2021 Corporate Scorecard as approved by the Board of Directors in December 2020. This shall serve as

a guideline for the development of individual scorecard.

Co

mm

erc

ial K

PIs

En

ab

lin

g K

PIs

Parameter Target Weightage

(%)

Staff Retention Rate 80% 5%


(%)

CSR programme 1 5%

Guided by the Company’s FY2021 Corporate Scorecard

Develop Strategies for Asset Enhancement and Optimisation


(%)

Achieve Equity Net Asset Value (“NAV”) growth 3% 45%

Reduction of negative shareholders funds 5% 10%

Early Redemption of Sukuk RM1.5bn 5%

Strengthen Relationship with Stakeholders

Leverage on Human Capital to Chart the Future GrowthDevelop Workflows and Processes to Support Business Growth

Financial Stakeholder

Internal Business Process Innovation & Learning

Staff Satisfaction Environment and Community

60%

Create Positive Work Environment Through Staff Empowerment Create Social Awareness Among Employees

10%

5%

15%

5%

5%

Parameter TargetWeightage

(%)

Periodic reporting of progress update to the Board 4 times 5%

Periodic reporting of progress update to the

Investment Panel4 times 5%

Periodic reporting of progress update to the Ministry

of Finance1 5%


(%)

Establishment of risk management framework 2Q2021 5%

Establishment of internal audit function 2H2021 5%

Parameter TargetWeightage

(%)

Staff Training3 days / person /

year5%


We have classified each department/division into the following buckets:

KPI Framework based on function

Business Drivers

• Investment Division

• Fixed Income

• Domestic Equities

• Global Equities

• Property Division

• Corporate Finance

Ancillary

• Operations

• Finance

Independent

• CEO’s Office

• Governance, Risk and Compliance

• Internal Audit

• Strategic Management

REVENUE

GENERATION SUPPORT MONITORING &

COORDINATION

Divisions in this bucket are expected to

have significant contributions to the

Financial Matrix

This bucket focuses on internal

business processes

An independent unit performs unique

sets of deliverables, with weights

distributed evenly in both internal

business process and stakeholders


KPI Matrix

The following KPI Matrix is for all staff in Business Drivers: Investment, Property & Corporate Finance

Quadrant

Total KPI weightage for each quadrant according to the job grade

L2 & above

(DGM &

above)

L4 to L3

(Manager to Senior Manager)

L6 to L5

(Sr Exec to Asst Manager)L7 – L9

(Exec & Support

Staff)

AllPeople

Manager

Individual

Contributor

People

Manager

Individual

Contributor All

FINANCIAL

(Target/Budget/Cost)50% 50% 50% 50% 50%

Staff

performance

will be based

on staff’s job

descriptions

accordingly.

STAKEHOLDER

(Stakeholder Management)20% 20% 25% 20% 25%

INTERNAL BUSINESS

PROCESS

(Risk/Compliance/Audit/Service

Excellence)

20% 15% 5% 10% 5%

INNOVATION AND LEARNING

(Learning Environment/

Increasing adaptability and

expertise)

2.5% 7.5% 12.5% 12.5% 12.5%

STAFF SATISFACTION

(Recognition/Retention/

Empowerment)5% 5% 5% 5% 5%

ENVIRONMENT &

COMMUNITY

(Community

Leadership/Collaboration)

2.5% 2.5% 2.5% 2.5% 2.5%

TOTAL 100% 100% 100% 100% 100% 100%

Notes:

a. Individual Contributor – staff without any subordinate

b. People Manager – staff with subordinate

c. All – applicable to all staff in that particular grade

People

Management

&

Development


The following KPI Matrix is for all staff in Ancillary Function: Finance and Operations

KPI Matrix (cont’d)

Notes:




Quadrant


L2 & above

(DGM &

above)

L4 to L3


L6 to L5


(Exec)

AllPeople

Manager

Individual

Contributor

People

Manager

Individual

Contributor All

FINANCIAL


Staff

performance

will be

according to

staff job

descriptions.

STAKEHOLDER


INTERNAL BUSINESS

PROCESS


Excellence)

40% 40% 40% 40% 40%




expertise)

7.5% 7.5% 2.5% 10% 7.5%

STAFF SATISFACTION



ENVIRONMENT &

COMMUNITY

(Community


2.5% 2.5% 2.5% 2.5% 2.5%

TOTAL 100% 100% 100% 100% 100% 100%

People

Management

&

Development


KPI Matrix (cont’d)

The following KPI Matrix is for all staff in Independent Function: CEO’s Office, Risk and Compliance, Internal Audit, and Strategic Management

Notes:




Quadrant


L2 & above

(DGM &

above)

L4 to L3


L6 to L5


(Exec – Support

Staff)

AllPeople

Manager

Individual

Contributor

People

Manager

Individual

Contributor All

FINANCIAL


Staff

performance

will be

according to

staff job

descriptions.

STAKEHOLDER


INTERNAL BUSINESS

PROCESS


Excellence)

35% 35% 30% 30% 30%




expertise)

12.5% 12.5% 22.5% 17.5% 22.5%

STAFF SATISFACTION



ENVIRONMENT &

COMMUNITY

(Community


2.5% 2.5% 2.5% 2.5% 2.5%

TOTAL 100% 100% 100% 100% 100% 100%

People

Management

&

Development


Rating DefinitionIllustrative

achievement levelDescription

5 Exceeds Expectations > 106%Performance has exceeded targets or requirements. It is regarded as

a superior job done i.e. very strong performer.

4 Meet Expectations 95% - 105%Performance is within range of targets or requirements between +-

5%. It is regarded as a good job done.

3 Partially Meets

Expectations

80% - 94%Performance has partially met targets or requirements by falling short of

5-20%. It indicates there is scope for improvement on the job.

2Does Not Meet

Expectations51 - 79%

Does not fulfill performance requirements i.e. by falling short of more

than 20%. It is regarded as a poor job done.

1Poor

Performance< 50%

Significant sub-par performance which requires immediate attention.

Sample Proposed Performance Assessment Scale


Introduction of Functional and Shared KPI

FUNCTIONAL

SHARED

Shared KPI explicitly used to embed

cross-functional

accountability and collaborations

Distinctly unique and driven primarily by

the incumbent/departmentNATURE

HOW IT WORKS

The identified deliverables will be the

inherent responsibility of the

person/department

e.g. Increase tenancy of Platinum

East Tower - Property Management

The weight assigned is shouldered by

the incumbent and/or team

Company’s KPI cascaded, owned and

shared by all departments on overall

scheme

e.g. Staff Satisfaction

The responsibility on staff retention falls

on all personnel and the achievement is

aggregated, and not on individual basis.

The weightage however differs for the

head of department and the staff


Sample Scorecard - Investments

# KPI Category Key Result Areas Indicators Description Unit Weight

1Financial

Performance

• NAV Growth

• Budget/Cost

• Percentage growth of NAV

• Performance benchmark

against KLCI

• EFMs meet target

• Measures the NAV growth against established

benchmark

%

Notes

2 StakeholderStakeholder

Management

• Government &

Stakeholder

Relationships

• Other indicators

• No. of annual/quarterly meetings with stakeholders (%

Shared Function for FY2021)

• EFM Engagements

#

3Internal

Process

Investment

Evaluation • Cycle time for Investment

Evaluation

• Average time taken produce a completed investment

evaluation report Days

4-6

People

Management &

Development

Innovation &

Learning• Trainings/Conference

• # of trainings attended at least 24 hours annually#

Staff SatisfactionDivisional Retention Rate • Shared function for staff retention #

Environment &

Community

CSR Programme• Shared function for CSR Programme

%

Notes: as indicated in the KPI Matrix section

Legend

Fully Shared function for FY2021

Must consist of an element of shared function i.e. Quarterly Presentation to the Board

Fully Functional or mixture of Functional and Shared


Sample Scorecard – Property Management


1Financial

Performance

• Occupancy Rate

• Budget/Cost

• Occupancy rate

• Operating expenditure

• Measures the % increase in occupancy rate

• Formulation of budget with no more than 10% variance in

operationalization of assets

%

%

Notes

2 StakeholderStakeholder

Management

• Government &

Stakeholder

Relationships




• Clientele/Prospective tenant engagement

#

3 Internal

Process

Portfolio

Management

• Number of projects successfully

executed/implemented

• Property administration

• Tender process/Disposal Exercise/Divestment

• Effective management of Property & Facilities

Manager (PFM) and/or marketing agent(s) with

quantifiable outcome

#

#

4-6

People

Management &

Development

Innovation &

Learning• Trainings/Conference

• # of trainings attended at least 48 hours#

Staff SatisfactionDivisional Retention Rate

• Shared function for staff retention

%

Environment &

Community


%

Notes: as indicated in the KPI Matrix section

Legend





Sample Scorecard - Operations

# KPI Category Key Result Areas

Indicators Description Unit Weight

1Financial

Performance

Financial

Management

• Operating cost

• Treasury Income

• A measure of the amount of cash spent for

operating the business

• Income earned by the treasury function in

managing the firm’s liquidity (cash from equities)

RM

RM

Notes

2 Stakeholder Stakeholder

Management

• Government &

Stakeholder

Relationships


• No. of annual/quarterly meetings with stakeholders

(% Shared Function for FY2021)

• Engagement with Custodian/Vendors etc

#

3Internal

Process

Trade

Settlement

• Efficient & precise execution of trade settlement

• No. of trade settlement as percentage of totalsubmissions, in a year, that had material errors

%

Administration &

Procurement• Office Administration • Measures the fulfilment of administration needs

• Measures the timeliness of execution of procurement activities in number of days

Days

Portfolio

Monitoring &

Management/

Reporting

• Performance evaluation of

External Fund Managers

& Internally managed fund

• Measures the accuracy of performance evaluation

report on External Fund Managers and Internally

Managed funds

#

4 - 6 People

Management &

Development

Innovation and

Learning/• Number of trainings/courses

completed

• Number of trainings/courses, can be classroom or

online, completed in a year. Measures effort put

into self development

#


Environment &

Community


%

Notes:

as indicated in the KPI Matrix section

Legend





Sample Scorecard - Finance

# KPI Category Key Result Areas

Indicators Description Unit Weight

1Financial

Performance

Financial

Management

• Operating cost excluding staffexpense and depreciation

• Treasury Income

• A measure of the amount of cash spent for

operating the business (excluding staff expenses

and depreciation)

• Income earned by the treasury function in

managing the firm’s liquidity

RM

RM

Notes


Management

• Government &

Stakeholder

Relationships


• No. of annual/quarterly meetings with stakeholders

(% Shared Function for FY2021)

• Other identified engagements

#

3Internal

Process

Financial

Reporting

• Submission of Management Accounts/ PortfolioReporting/GroupReporting/BOD Paper/GroupReporting Pack

• No. of submissions as percentage of totalsubmissions, in a year, that were overdue by morethan 3 days or had material errors

%

#

Budgeting• No. of days late for the

circulation of budget memo• No. of revisions required to

budget before BOD approval

• Measures the timeliness of the budgeting process

• Measures the accuracy of the budgeting process

#

#

Portfolio

Monitoring&

Management

• No. of Finance projects

successfully completed

• TBD by head of department

#

4 - 6 People

Management &

Development

Innovation and

Learning/• Number of trainings/courses

completed

• Number of trainings/courses, can be classroom or

online, completed in a year. Measures effort put

into self development

#


Environment &

Community


%

Notes:


Legend





Sample Scorecard – Governance & Risk Management


1Financial

PerformanceOperational loss

• Value of operational loss from

unidentified

risks

• Measuring the value of operational losses from risks not

identified by Risk Management that occurred over a

certain period of time

RM

Notes


Management

• Stakeholder

Relationships




• Consultants/Government Agencies/Authority/Regulators

#

3

Internal

Process

Corporate

Governance

Framework

• Percentage of processes

reviewed & updated within

timelines

• No. of processes as a percentage reviewed, and updated

where required, successfully within the defined timeframe

%

Risk Management

Framework

• Number of gaps identified and fixedwithin timelines while reviewing theprudent risk assessment framework

• Time necessary to perform risk evaluation and assessment

• Number of gaps identified and fixed (as a %) within

timelines while reviewing the prudent risk assessment

framework

• Measuring the efficiency of the risk evaluation and

assessment process

%

Days

Investment

Evaluation

• No. of risk assessment reports

produced within timelines, for each

proposed investment & divestment

• Measures the risk assessment support offered to the

investments team while both evaluating as well as exiting

an investment

#

4 –

6

People

Management &

Development

Innovation and

Learning• Number of trainings/courses completed

• Number of trainings/courses, can be classroom or online,

completed in a year. Measures effort put into self

development

#


Environment &

Community


%

Notes:


Legend





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