HRiday Veda - July/August 2012. Theme: Performance Management

Sneak-Peek

Newsletter theme :Performance Management System

Who we are pg 2

HR News: July / August 2012 by Rohan Bedi pg 3

Articles : Winning articles of HR Veda of Samriddhi 2012

Creativity in HR by CharuPuri, IMI Delhi pg 9

Creativity in HR by VikramTuli, Great Lakes pg 12

Performance Management System by MansiVartak and VyomaVegad pg 14

July - August 2012 HRiday Veda P a g e | 2

HR Talk: An Interview with Mr. Manish Jha pg 18

HR Glossary (Performance Management System) by VivekSaha pg 20

HRiday in Action pg 24

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People.Passion.Performance.

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HR NEWS

Maruti Suzuki to resume

production at Manesar

Maruti Suzuki,

India's largest

carmaker, will lift

the lockout at its

Manesar facility on

August 21 and restart production

on a small scale.

Initially, the Manesar plant will

operate under heavy security at

one-tenth its capacity, with 300

workers earmarked to roll out 150

Swift hatchback and DZire sedan

on a daily basis from its two

plants. Maruti had declared the

lockout at the Manesar plant on

July 21 after workers went on a

rampage killing one official and

injuring a hundred others.

The company will dismiss at least

500 permanent workers, including

the 154 workers who are currently

in police custody.

The company said that based on

the police investigation and its

internal enquiries, it has identified

at least 500 permanent workers

who are believed to be involved in

the violence and they 'will not be

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taken back'. Going forward during

the course of investigation of the

July 18 violence, the company said

more workers could face the axe.

HSBC not to opt for job

cuts in India

A day after announcing trimming

its global workforce by 30,000,

banking major HSBC ruled out any

significant job cuts in India, a

strategic market where it is

fighting high attrition rate.

Responding to a question on

whether job cuts announced by

the global management on July

30 would apply to India, HSBC

India Chief Executive Mr Stuart A

Davis told reporters, “I think India

already has a very high attrition

rate. We are hard-pressed to even

catch up on the replacements.”

Mr Davis further said that

reallocation of resources means

that if there are too much of

bureaucracies at the back-end,

what is needed is streamlining the

back-end and use the resources in

the front-end.

HSBC has 50 branches across the

country employing about 6,000

people. “As far as India is

concerned, I won’t be overly

concerned. The important thing is

that both India

and China are

classified as

strategic

markets. So we

will continue to

feel for India

and China,” he said.

He also hinted at more hiring if

the economy continues to grow

the way it is. “If GDP is going to

grow at 7.5 per cent, I think

India is probably to be at that

range also, and then I have to say

the head-count will probably go

up.

Infosys set to hire

25,000 employees for

new Hyderabad Centre


Infosys will recruit 25,000 for its

second centre in Hyderabad. They

would recruit 14,000 in the first

phase and 11,000 more in the

second phase of the 448-acre

special economic zone campus at

Pocharam on the Warangal

highway.

An

Infosy

s

delega

tion

led by

its Chief Executive Officer and

Managing Director, Mr Kris

Gopalakrishnan, met Mr N Kiran

Kumar Reddy, the Andhra Pradesh

Chief Minister, and explained to

him about the expansion plan in

Pocharam.

“The facility already houses 4,000

employees. We will add the

remaining in phases,” a statement

from the Chief Minister's Office

quoting Mr Gopalakrishnan said.

The company's Pocharam facility

was in the news recently after

APIIC (Andhra Pradesh Industrial

Infrastructure Corporation) served

a notice on the company, asking it

to explain the reasons for the

delay in meeting the deadlines

agreed upon.

IT sector failed in

skill development, says

panel

An industry whose very

foundations are built on 'skill' has

been accused of being tardy in

identifying and nurturing it with

ruinous implication for the future.

A recent Parliamentary Standing

Committee on Human Resources

(HR) has made critical

observations on talent and skill

development initiatives taken by

IT companies and industry bodies.

However, these comments elicited

strong reaction from the software

industry which said enough and

more is being done to enhance the

skill sets of its labour force

though the primary responsibility


lies with the government in this

area.

The committee said that the

existing skill development activities

carried out by enterprises and

industry bodies are slow,

directionless and it might have

serious consequences for the overall

growth of the IT sector, said the

committee.

The response from the industry

was the opposite. Responding to

the committee observations,

Nasscom president Som Mittal

said, "We were not part of the

committee report. IT is a highly

peoplecentric industry. We are

working independently and we also

have strong partnerships with the

industry, academia and universities

to ensure capacity development

and skill development."

Mittal said training/skilling is

happening at

multiple-levels. There

are several

independent training

outfits; companies have their own

training and skill development

facilities, plus Nasscom has a

Sector Skill Council and Nasscom

Foundation runs an Animation &

Gaming Academy.

Employees face burnout

due to performance

pressure

After hours is party time. Not

exactly.Bosses text employees even

after they leave office. Status

update is not about Facebook, but

about office assignments. Holidays

and vacations are a luxury.

Performance pressures stalk young

employees - the work engine of a

company - the most, resulting in

burnouts.

"It is certainly a growing

phenomenon. Nobody is untouched

by it, not even CEOs ," says

RoneshPuri, managing director of

Executive Access, an executive

search firm. Puri recalls an

incident: "A CEO of a top

company was weeping because he

couldn't take enough time off


from work and be with his ailing

mother. This was not the case

earlier. Performance pressures are

very high now."

During the

slowdown, many

companies

stopped outdoor

and recreational

activities -

initiatives which

considerably ease pressure at work

and help build team bonding. Many

of them have still not restarted

those programmes . "Only 30-40

% of the companies have restarted

these programmes," says Puri .

"With increasing inflation and

interest rates, the decision is

considered cost prudent by the

companies."

Though there's an increase in the

incidence of burnout cases overall,

some sectors like IT and telecom

are affected more. "With

company-provided laptops and

BlackBerrys, employees don't know

where work stops and their own

social lives start. New economy

businesses like IT and telecom are

the most affected," says E Balaji ,

CEO of Ma FoiRandstad, an HR

consultancy firm.

IIM Rohtak to organise

human resources summit

on managing new

generation employees

Indian Institute of Management-

Rohtak is organising a human

resourc

es

(HR)

summit

titled

'HR challenges of managing new

generation employees' at its

campus in the MaharshiDayanand

University on August 18.

Underscoring the industry relevance

of the summit, the IIM

spokesperson said that HR

professionals today are venturing

into an uncharted territory

replete with unique challenges such


as managing the generation Y

employees.

The summit is being organised to

discuss the emerging needs of the

profession. Executives from diverse

sectors ranging from consulting to

consumer electronics are attending

the summit.

Abhishek Tiwary, HR director -

KPMG, Aparna Sharma, HR

director - Deutsche Bank and YV

Verma, COO - LG Electronics are

among the dignitaries expected to

turn up for the event .

CEOs are the latest

Indian export

Indians are

increasingly rising

to the top of

global corporate

ladders and just 10 of them are

together managing business worth

over $ 400 billion -- an amount

nearly double the total exports

from India in a year.

So, it does not come as a surprise

when CEOs are being billed as the

latest and leading export from

India, given the multi-national

giants like Citigroup, Deutsche

Bank, PepsiCo, Unilever, Adobe,

Mastercard and Motorola having

Indian-origin persons in their top

leadership positions.

International magazine Time also

recently termed CEOs as India's

leading export and said that the

subcontinent could be "the ideal

training ground for global bosses".

Experts believe that Indians'

inherent focus on good education

and their ability to work in

difficult situations is aiding to the

trend and more and more Indians

could rise to top positions at

global companies in near future.

There are about a dozen large

global companies outside India with

Indians or persons of Indian origin

in their top management

positions, while there are many

more dozens at the helm of


affairs at mid-level and smaller

companies.

Future group to use

alternative management

methods

Mr Kishore Biyani, Chairman of

the Future

expects to

create new

rules in business

management

based on Indian

beliefs and mythology.

His philosophy of staying away

from the tried and tested

management techniques is getting

implemented slowly with the

appointment of a Chief Belief

officer for the Group. Today the

Future group is looking at

alternate management techniques

by giving its employees a chance

to delve into new options to run

the business.

Speaking to Business Line, Dr

DevduttPattnaik, Chief Belief

Officer, The Future Group, said:

“We are trying to tell employees

of the Future group that there is

an alternative way to do business

and not just follow-the-standard-

concepts taught at management

schools. We are not about KRA

(key result area) and KPA (key

performance indicator). Today all

management learnings are based on

a linear mindset which is influenced

by the western world.''

People management

trends in 2011

Lynn Lobo discusses significant

people management trends of the

first half of 2011 that will pave

the way forward for the rest of

the year and a productive 2012

One cannot refute the fact

that the “people” of an

organisation are its most

indispensable assets. Top HR

managers today have come to

comprehend the significance of

effective people management

practices, thus enabling proficiency

in the functioning of the


organisation. The onset of 2011

saw HR managers pledging to

imbibe tactful people management

practices that they hoped would

induce adeptness in the

organisational structure.

While some companies, in the

past half year have resorted to

implementing “selection

interviews” where employees are

cross-examined at the time of

appraisals, other companies have

opted for exit interviews where

employees are interviewed upon

their exit. People management has

many facets and HR managers in

the six months gone by have tried

to tap into every aspect of it by

infusing novel practices in the

firms hoping to fuel employee

performances for the best.

Aleem Merchant, director, Synapse

Marketing Consultancy Pvt. Ltd

deemed the use of social media as

a widely implemented practice in

the past six months, “Having an

official social networking site

encourages employees and clients

to bond and garners feedback,

enhances interpersonal relationships

and also gives the employees a

sense of fulfilment as their work is

displayed for everyone in the

virtual world to regard. The team

gets excited to have their

‘moment of fame’ in the fast-

growing online arena and an overall

sense of pride and ownership flows

through the organisation in a

transparent format. An alumnus

of exemployees is formed, which

might urge people to join the

organisation again after seeing this

youthful approach.”

Top managers need to

improve

communic

ation:

E&Y

Effective

communicati

on is critical. Especially when it

comes from people who helm

organizations, teams or even a


country, for they articulate the

values, principles and standpoints

of the organizations they

represent. When leaders make

careless remarks, the damage done

ricochets on the organization and

its image. There are those in the

public eye who will harp on others’

mistakes even as they play down

their own or those of their

associates. Gaffes and defensive

talk go on ad nauseum.

There have been frequent studies

on how effective communication is

within and outside organizations in

India. “Employee engagement

surveys” conducted by Ernst and

Young for different organizations

over the years, for example, have

shown consistently that senior

management needs to communicate

more effectively.

Explains Anurag Malik, partner,

advisory services, Ernst and Young,

Mumbai: “We measure the

effectiveness of communication

within the organization and its

impact on employee engagement.

The communication scores,

especially those pertaining to

senior management, are on the

lower side in India. Our surveys

have shown that CEO and senior

management need to play a strong

role in driving effective

communication and percolate across

to all levels in the organization.”

Hiring drops after

reaching peak in March-

April

The subdued economic sentiment

has its echo in the job market.

From its peak in March-April

2011, the job market has hit a

rough patch - new jobs are being

added at a slower rate. "Jobs are

being added, but at a slower rate

than the last three-four months,"

says Shiv Agrawal, CEO, ABC

Consultants, a placement firm.

This is due to a hint of caution

triggered by overall economic

sentiment being dull.


A recruitment index also reflects

this concern. After three months

of increased hiring, the demand for

talent dropped in June 2011,

reveals RecruiteX, an index that

decodes the hiring trends across

sectors after evaluating the

demand and supply of talent

across industries.

"It is a minor blip due to

downcast economic sentiment and

negative sentiment overseas," he

adds.

In

terms

of

sectors

,

financial services and telecom

sectors are sluggish, IT is doing all

right and consumer durables is

witnessing a good growth in jobs,

according to Agrawal. There is

caution, but no one is talking

slowdown yet. Says Sanjay Bali,

vice-president, HR, at Samsung:

There is no negative segment in

the job market. We finished a

large chunk of our lateral hiring in

the first half of the year."

Replacement hiring at Samsung is

on to take care of the 10-15%

attrition levels and for new

growth areas such as the rollout

of new tablet.

Female employees plan

taxes better: Study

Female salaried employees are

paying less tax than their male

counterparts due to lower tax

slabs and better investments, with

the percentage of women with a

low tax ratio of 0-5 per cent

higher than their male

counterparts, according to the

latest study.

As per

the

findings

of the

'India

Tax Ratio 2011' report by

TaxSpanner, an online income tax


return filing portal, the average

tax ratio of females salaried

employees in major Indian cities is

4 per cent, as against 6 per cent

for males.

Besides, around 76 per cent of

the females have a tax ratio of

less than 5 per cent, compared to

59 per cent in the case of male

salaried employees.

The tax ratio is the percentage of

the salary that one pays as tax.

The study covered employees from

over 500 corporates in major

cities, including the Delhi NCR,

Mumbai, Chennai, Bangalore and

Hyderabad.


Creativity In

HR

Samriddhi, the business fest of

GIM, had organised an essay

writing competition. We received

22 entries from B-schools all over

India. The award winning articles

have been published in this

month’s HRiday Veda.

At Applied Language Solutions, an office wall is in the form of a snakes

and ladders game. Whenever a sales person gets a contract worth £4,000

he or she throws a die and the first person to rise till the end gets a

trip to Barcelona or Amsterdam. This helps spur high achievers and

promote healthy competition.1

Applied Language Solutions is one amongst the many organizations that

are catching up with the trend of using creative, off beat solutions to

drive human resources. Human resources has evolved from a purely

administrative and peripheral function to contributing to the success of a

business as a strategic partner. In highlighting the role of HR, with the

help of Dave Ulrich’s Model the various roles and the creative approaches

associated with them have been 7exemplified.

The human edge: Creativity in different HR Roles

Dave Ulrich gave the following model to classify the many roles that HR

managers play. Each role encompasses

different facets of human resources, and each role is exemplified by many

creative initiatives.


Strategic Partner

HR is beginning to be accepted as an equal business partner due to

growing problems of attrition and employee discontent. At Mudra LLP,

India the top HR Managers sits with the board of directors to help create

a strategy that attracts, retains and motivates the creative talent that

this organization needs to create value. One of the earliest examples of

organizations that embraced the concept of creativity in HR is Google.

The Other Story:

In 12 years of its being this organization has become the dream place to

work for many people. As part of its strategy they hire the best. They

do this by spreading a culture that helps in maximum productivity and

encourages innovation. When you enter Google’s Toronto office, the

legend reads “proud to be geeks”, Google celebrates their quirkiness and

their desire to come up with new things.

Employees are provided with 20% of work time to utilize for making

something new. Creativity demands absence from distractions and a

supportive culture that promotes risks. Google goes above and beyond this

to provide relaxing pods where employees can reflect, a diverse work

force, collaboration opportunities

to fuel innovation.

Change Agent


In a dynamic environment, if you snooze .you lose .HR is

the facilitator for change. Without policies and a culture

that drives change, organizations become stagnant and

eventually die out. Recruiting the right people,

acclimatizing employees to change through the right

training initiatives, having a rewards and recognition

system that promotes new ideas are some of the responsibilities of the

HR Manager as a change agent.

Pirates: Upsetting the Cart

In his book What Would Steve Jobs Do? Peter Sanders talks about how

Steve Jobs wanted Pirates in his organization. Why? Pirates are

continuously looking for new avenues for change. The talent acquisition at

Apple was such that candidates with a mindset that supports the culture

of apple were chosen. Apple’s culture supports employees who are not

only brilliant but also excellent team players and collaborative thinkers.

They have the passion and democratic values of a pirate. Steve Jobs also

recognized the importance of Diversity .Today HR has helped in facilitation

of radical ideas by promoting diversity within the organization.4

Dministrative Expert

For this function HR has to look at day to day solutions to help run an

operationally smooth organization and keep its employees happy. Creativity

in this function stems from having cost effective processes such as

awarding environmentally friendly employees or giving the facility for

carpooling in a way so that it becomes easier and cheaper for employees


.Some organizations in Gurgaon where BPO employees do not have cars

give the facility of using an auto rickshaw for groups .Another great

example of employee welfare is the UTRCA.

Another great example of employee welfare is the UTRCA.

Walking Tours ,yoga and Bike rides were organized in the lunch hour

Motivational guest speakers to disseminate information about wellness and healthy lifestyle.

1 year interest free loan to buy fitness equipment to motivate exercise and help increase employee

productivity.

Employee Advocate

HR function is a fine balance between having both the organization and

the employee’s interests at heart. In order to manage the most valuable

resource of an organization-intellectual capital, HR helps in acquiring,

training and succession planning for these employees. Hr also helps develop

employee engagement to curb the menace of high turnover by designing

policies and procedures that help to increase employee productivity.

Human Resource function is complex as it manages a resource which is

characterized by unpredictability, fickleness and inability to measure

accurately its nuances. The sociological phenomena and the interconnected

web of relationships further complicate it. Creativity is needed to gauge,

manage, and encourage intellectual capital. The ever changing generational

differences, diversity due to the advent of globalization further call for

innovation on the part of the internal marketers- The Human Resource

Managers

References

1. (2007),"Head massage? That will do nicely at Applied Language

Solutions: Innovative HR policies keep


energy, enthusiasm and commitment high during rapid expansion", Human

Resource Management International Digest, Vol. 15 Iss: 2

pp. 10 - 13

2.http://hrmadvice.com/hrmadvice/hr-role/ulrichs-hr-roles-model.html

http://www.articlesbase.com/human-resources-articles/innovative-hr-

practices-1135577.html

3. http://www.eco.ca/pdf/ECO_HR_BestPractices_Report.pdf

4.http://www.fastcodesign.com/1665840/an-hr-lesson-from-steve-jobs-if-

you-want-change-agents-hire-pirates

- By CharuPuri, IMI Delhi

CREATIVITY IN HR

Nothing, absolutely nothing is more creative than trying to figure out

individuals idiosyncrasies and what strategies they can pursue to get what

employees want or aim for while ensuring that everyone else has a shot at

their goals, too. Rules and policies truly are made, if not to be broken, or at

least bent, stretched, modified, turned to everyone’s advantage. And HR is the

primary place that it should occur. How else can we keep some sort of logic

and balance in the midst of constant growth and competition all around?

HR itself is bound and restrained by many other

disciplines of an organization like union

http://hrmadvice.com/hrmadvice/hr-role/ulrichs-hr-roles-model.html

http://www.articlesbase.com/human-resources-articles/innovative-hr-practices-1135577.html

http://www.articlesbase.com/human-resources-articles/innovative-hr-practices-1135577.html

http://www.eco.ca/pdf/ECO_HR_BestPractices_Report.pdf

http://www.fastcodesign.com/1665840/an-hr-lesson-from-steve-jobs-if-you-want-change-agents-hire-pirates

http://www.fastcodesign.com/1665840/an-hr-lesson-from-steve-jobs-if-you-want-change-agents-hire-pirates


rules, CEOs orders, financial requirements, etc. So the freedom has its own

boundaries and limitations. Moreover in a well-established Organization you do

not have the luxury to test something or experiment. You need solutions

today or tomorrow. You need a true sense of what makes people tick and the

variations that exist in your particular culture, organization, unit, and team

make it so more difficult. Figuring out how to align all that for everyone’s

benefit is, to say the least, the most complex sort of challenge we ever face.

So much so that many people just ignore it because they can’t face the

creative struggle it often requires.

There are many areas in which HR can be creative and innovative:-

Be farmers, not manufacturers of talent

Most of our organisations are modelled on the principles of manufacturing -

linearity, specialisation and the division of labour. I think that the exact

opposite is the case. Great farmers know that you can't make a plant grow by

force; the plant will grow itself if the conditions are right. Your job is to get

the conditions right, and I think that human flourishing, human creativity, is

always a function of the right cultural circumstances. HR isn't incidental to

that but strategically at the centre of it. If you create the right mix of

conditions people will flourish in particular ways. If you create the wrong

conditions they will inhibit themselves, pull themselves back and keep themselves

from the business at hand.

HR must design the table, not just get a seat at

it

HR must make the shift from transactional to transformational ideology -

driving change within a business instead of just aligning with it - if it wants "a

seat at the table”.

Ride the dragon


HR must understand the changes that Gen Y is bringing into the workforce.

They are bringing into the workplace a significant shift. They're not focused on

being with your company for ever, and not necessarily interested in climbing the

corporate ladder. These folks are very focused on what they consider to be an

engaging workplace. Their demands are not about becoming CEO’s overnight.

They are focused on their life and the challenge we've got here is to provide

them with work/life balance. They do not like nine-to-five culture anymore.

They want flexibility and at the same time freedom to do things their own

way. HR must move away from traditional measures of success - such as cost

per hire, billing and focus on "world class quality".

Take care of employees, including the ones who

are leaving

Although employers might currently be releasing employees they must remember

that the economy will turn up and we would need to keep that forefront of

our minds. We will need our employees - we will need them badly. HR’s to

remember "who your former employee may be", because they might be a

vendor to the company; a customer; a competitor; a blogger; an ambassador; or

a critic. The person you're trying to hire tomorrow might ask them what they

thought about working for you. "What is the answer going to be when your

former employee gets that phone call?"

Creative Performance Management System

Creative PMS can be based on the principle of “Surprise Reviews”, wherein the

format of appraisal forms could be very simple (around a page) and any person,

with whom the individual/team has worked, could be asked any feedback.

Besides the above mentioned points, there can be a lot of activities and

processes in HR which would act as “Human Intelligence Boosters”. There is a

definite need to utilize the human potential to the maximum, with less of

stress and more of enjoyment and entertainment. An employee needs to be

entertained at workplace, not by means of any jam sessions or parties, but by


the way he/she would be treated at the workplace. A good work culture, where

human intelligence is respected, results in excellent performance and sound HR

practices.

On a concluding note -The HR profession has a long way to go to fully arrive

at the desired impact. But, by being clear about how we can make a difference

to key stakeholders we can start by recognizing not only where we are going,

but what it will take to get us there.

- By VIKRAM TULI, Great Lakes


Performance Management System – An Overview

The role of HR in the present scenario has undergone a sea change and its

focus is on evolving such functional strategies which enable successful

implementation of the major corporate strategies. In a way, HR and corporate

strategies function in alignment. Today, HR works towards facilitating and

improving the performance of the employees by building a conducive work

environment and providing maximum opportunities to the employees for

participating in organizational planning and decision-making process. Today, all

the major activities of HR are driven towards development of high performance

leaders and fostering employee motivation. So, it can be interpreted that the

role of HR has evolved from merely an appraiser to a facilitator and an enabler.

Performance management is the current buzzword and is the need in the

current times of cut throat competition and the organizational battle for

leadership. Performance management is a much broader and a complicated

function of HR, as it encompasses activities such as joint goal setting,

continuous progress review and frequent communication, feedback and coaching

for improved performance, implementation of employee development programs

and rewarding achievements. The process of performance management starts

with the joining of a new incumbent in a system and ends when an employee

quits the organization. Performance management can be regarded as a

systematic process by which the overall performance of an organization can be

improved by improving the performance of individuals within a team framework.

It is a means for promoting superior performance by communicating

expectations, defining roles within a required competence framework and

establishing achievable benchmarks.

According to Armstrong and Baron (1998), Performance Management is both a

strategic and an integrated approach to delivering successful results in

organizations by improving the performance and developing the capabilities of


teams and individuals. The term performance management gained its popularity

in early 1980’s when total quality management programs received utmost

importance for achievement of superior standards and quality performance.

Tools such as job design, leadership development, training and reward system

received an equal impetus along with the traditional performance appraisal

process in the new comprehensive and a much wider framework. Performance

management is an ongoing communication process, which is carried on between

the supervisors and the employees throughout the year. The process is cyclical

and continuous in nature. A performance management system includes the

following activities:

Developing clear job descriptions and employee performance plans which

includes the key result areas (KRA') and performance indicators.

Selection of right set of people by implementing an appropriate selection

process linked with competencies identified for each position

Negotiating requirements and performance standards for measuring the

outcome and overall productivity against the predefined benchmarks.

Providing continuous coaching and feedback during the period of delivery of

performance.

Identifying the training and development needs by measuring the outcomes

achieved against the set standards and implementing effective development

programs for improvement.

Designing effective compensation and reward systems for recognizing those

employees who excel in their jobs by achieving the set standards in

accordance with the performance plans or rather exceed the performance

benchmarks.

Providing promotional/career development support and guidance to the

employees.


Performing exit interviews for understanding the cause of employee

discontent and thereafter exit from an organization.

A performance management process sets the platform for rewarding excellence

by aligning individual employee accomplishments with the organization’s mission

and objectives and making the employee and the organization understand the

importance of a specific job in realizing outcomes. By establishing clear

performance expectations which includes results, actions and behaviors, it helps

the employees in understanding what exactly is expected out of their jobs and

setting of standards help in eliminating those jobs which are of no use any

longer. Through regular feedback and coaching, it provides an advantage of

diagnosing the problems at an early stage and taking corrective actions. It

enables an organization to manage two critical elements of performance:

behavior and results. (Dr. Aubrey Daniels). A good performance management

system benefits the organizations by helping them find the right talent, place

them in the right position, align performance with the organization’s vision and

strategic objectives, develop abilities and reward performance commensurate

with contributions to the organization’s success. (SHRM India)

A good performance management system provides an organization a competitive

edge by linking strategies to employees keeps employees happy and loyal to the

organization and provides HR with a clear picture of the developmental needs

of employees.

Below are some of the best practices followed in Performance Management

System by a few companies.

Siemens: It has standardized the process for managing performance and

development of all employees. The PMS creates a direct link between the

strategy of the whole organization and plans for an individual. Targets are set

based on individual roles and responsibilities and by meeting these personal goals,

an employee contributes to the organizations’ targets.


Larsen & Toubro: The engineering major has developed a competency

matrix of 73 elements each with associated knowledge skills and attributes,

across various managerial levels. This matrix is linked to business strategy and

training needs. Employees are evaluated against these competencies and

functional, managerial and behavioral gaps are recognized. These gaps are then

addressed via focused re-skilling and re-learning.

National Panasonic: The Company’s PMS is driven by Key Result

Areas (KRAs). These define the business, functional and behavioral goals set

jointly by an employee and his manager at the beginning of the year. KRA’s

serve as yardsticks of measurements. Any shortfall in accomplishments of

targets is met by relevant training inputs. Reskilling is emphasizes over

expensive mid-career hires.

Hughes Escorts: This Company follows a competency based performance

enhancement model. Each position is defined in terms of 23 competencies.

These are sub grouped under attitude based, knowledge driven, skill centered

and value based.

EFL, India: The employees are divided on the basis of hierarchy of jobs

for eg: frontline salesmen, leaders of the salesmen, leader of the leaders and

the top management. For each level a different tool is used to measure

performance. The frontline salesmen are evaluated via a performance review and

development program (PRDP), and performance improvement plan (PIP). A

Leader’s Dashboard is used to measure the performance of the managers and

their seniors based on different parameters. Management by Objectives is used

to evaluate performance of the management level. The pillars of MBO, PRDP

and MBO are trust, agreed confidentiality, positive approach, sensitivity to

feelings, acceptance of each other’s strengths and limits, empathy and goodwill.

The Nielsen Company:Meritocracy forms the basis of PMS here. It is

the principle of differentiating rewards based on performance. Performance is

assessed on several factors such as delivered results, impact, team contribution,


leadership effectiveness, initiative and demonstration of company values. High

performers receive higher rewards and low performers receive lower rewards.

Thus the performance bar is raised each year to stay at par with competition.

To conclude, performance management can be regarded as a proactive system of

managing employee performance for driving the individuals and the organizations

towards desired performance and results. It’s about striking a harmonious

alignment between individual and organizational objectives for accomplishment of

excellence in performance.

Dr. Reddy’s Laboratories: The performance management at Dr.

Reddy’s is a three-stage process:

1. KRA & Goal setting for the year – Goals under each KRA (Key Result

Area) are defined at the beginning of the year and are reviewed in each

quarter to monitor progress.

2. Mid- Term Review

3. End-Term Appraisal

The employee has to provide inputs to the set of self-assessment questions and

the form is sent to the appraiser. The appraiser communicates the rating

against each goal, behavior assessment and gives feedback. After the feedback is

given, a discussion with the employee takes place to communicate the feedback.

The different ratings given to employees are:

Exceptional Contributor : Surpassed the targets

Significant Contributor: Achieved all the targets

Reasonable Contributor: Achieved just the critical targets

Partial Contributor: Met only few of the assigned targets

No Contribution: Not achieved any of the targets.

NOCIL Limited: National Organic Chemical industries Ltd. (NOCIL) is a

part of the AMG (Arvind Mafatlal Group) of Industries and is the Largest


Rubber Chemicals Manufacturer in India. The performance system followed is

known as Performance Planning Development Review and Management System

(PPDRM). The employees have to decide their Key Performing Areas (KPAs)

at the beginning of the year. The training and development plan is developed

for 3 areas: – Job related, general management, attitude and behavioral

training in the beginning of the year. The employees are rated on a 5 point

scale. The people who are involved in the process are Employee, Immediate

Supervisor, Department Head or Divisional manager, Reviewer, HR Professional

and Internal Consultant.

Tata Steel: There are three different components for performance

management that are administered at three different times during the year.

First is the conventional appraisal component, second is managerial style

component and third is the internal customer assessment. The goals are set in

April and are the reference point when the appraisal happens one year later.

The employee set the goals and inputs the work done, highlights and

achievements in the year. It goes to the supervisor for assessment. The

Managerial style feedback is used for division managers and above. Seven

feedbacks from seven subordinates are collected for a single manager and average

is taken to evaluate. This data is used for increments, promotion and new

assignments. Under internal customer assessment, TISCO includes colleagues and

peers from other departments to give feedback about the individual. Out of

the list of 15-20 people provided by the employee with whom he works on

regular basis, a random sample of 10-12 people is selected. These employees are

presented with a Questionnaire of 10 questions to write open ended responses

and their feedback is given to the individual employee.

- By MANSI VARTAK and VYOMA VEGAD


HR Talk :

Interview of Mr. Manish Jha, HR

Manager in Magma Fin

Corporation

1. Please tell us a few critical

points an HR professional should

consider before designing a

Performance Management System

(PMS) for an organisation

Ans:- Before Designing a PMS, one has to ensure

following critical points

1. (a) Feasibility: - In terms of head count, number of functions and economic

feasibility.

(b) PMS should be linked to the Balance Score Card: - One has to ensure

that Line Employees & Support / Partnering employee has clear cut deliverables

(Key Result Area) which should be directly linked to PMS.

(c) Robustness: - PMS tool should be robust in nature. Such a PMS can

only be made once the person designing PMS has good knowledge of the

business or service delivery model, also he should have a strong business acumen

so as to keep PMS viable in real time changing business environment.

(d) A good PMS tool should be one rewards productive and potential employees

and should not be done on perception basis.


2. Please share an overview of the PMS

followed in your organisation

Ans :- We at Magma Fincorp Ltd. use a relative bell curve as our PMS tool

which is one of widely used tools across the globe, bell curve specially works well

wherein you have large head counts (ours is 6300). We at Magma has

designed and developed a unique Balance score Card System which is largely

divided in two parts (i) Key Result Area : these are generally tangible figures

which varies across role folders (ii) Key Success Factors : these are intangibles

like, behaviour & leadership skills. We rate our employees on the above

mentioned parameters which ensures the best performing talents get rewarded

relatively.

3. Do you use it for career planning of

your employees ? If so, how does it help them

Ans :- Yes, we at Magma give great importance to career planning and have an

elaborate process and mechanism through which we draw and administer career

paths for our employees, one such examples is Udaan& Pinnacle (Both are

automated Career Progression Planning tools, which are applicable till Asst.

Mgr. Level) They are tools used for the sales force and receivable management

team. These tool helps us in accessing and promoting our front line people, it

also helps us in creating a talent pool within the organisation. These Career

Progression Planning tools are directly linked with our PMS. Hence at Magma

we have a robust PMS tool which is not only used for appraisals also for

developing a talent pool, career planning & succession planning.

4. Please share some of the key challenges

you faced during implementation/ sustenance of

the current system in your organisation

Ans :- Most of the challenges that we today face or have faced are external

and is because of real time changing scenario in financial domain.


5. Finally, your advice to budding HR

Professionals

Ans: - In today’s changing scenario, a HR professional should not lose the real

meaning of Human Resources in the fascinating and complex systems and

process oriented environment. As an HR professional, we should keep humanness

intact in all our dealings.


HR Glossary (Performance

Management System)

Balanced scorecard :A

popular strategic management

concept developed in the early 1990s

by Drs. Robert Kaplan and David

Norton. The balanced scorecard is a

management and measurement

system that enables organizations to

clarify their vision and strategy and

translate them into action. The goal

of the balanced scorecard is to tie

business performance to

organizational strategy by measuring

results in four areas: financial

performance, customer knowledge,

internal business processes, and

learning and growth.

Bell-shaped curve : The

curve representing the normal

distribution of a rating or test

score.

Career development :The

process by which individuals establish

their current and future career

objectives and assess their existing

skills, knowledge or experience levels

and implement an appropriate course

of action to attain their desired

career objectives.

Career Ladder : The

progression of jobs in an

organization’s specific occupational

fields ranked from highest to lowest

based on level of responsibility and

pay.

Career planning : The

process of establishing career

objectives and determining

appropriate educational and

developmental programs to further

develop the skills required to achieve

short- or long-term career objectives.

Comparatio : The ratio of an

actual pay rate to the midpoint for

the respective pay grade used for

comparing actual rates of pay with

the midpoint for a particular pay

grade within the salary structure.

Comparative rating :A

rating method that determines


ratings by making comparisons

between the individuals being rated.

Competencies : The knowledge,

skills and abilities required to

perform a specific task or function.

Core competencies: The

skills, knowledge and abilities which

employees must possess in order to

successfully perform job functions

that are essential to business

operations.

Direct compensation: All

compensation (base salary and/or

incentive pay) that is paid directly

to an employee.

Exit Interview: An interview

conducted at the time of an

employee’s resignation, used to

identify the underlying factors behind

an employee’s decision to leave.

Extrinsic Motivator:

Organizationally controlled incentives,

such as pay, benefits, incentives,

achievement awards, etc., used to

reinforce motivation and increase

performance.

Feedback : Positive or negative

information provided to an individual

in the form of coaching or counseling

regarding his or her performance or

behavior.

Goal Setting : The process of

setting and assigning a set of specific

and attainable goals to be met by an

individual, group or organization.

Grievance : A formal complaint

or allegation by an employee or

group of employees made to unfair

treatment or violation of a union

contract.

Incentive pay : Additional

compensation used to motivate and

reward employees for exceeding

performance or productivity goals.

Intangible rewards

:Nonmonetary reinforcing, such as

praise, given to an employee in

recognition of a job well done or a

particular achievement.

Intrinsic reward:A reward

given to an employee for

achievement of a particular goal,

objective or project.


Key performance

indicators : Key Performance

Indicators are quantifiable, specific

measures of an organization’s

performance in a certain (KPI)

area(s) of its business. . The

purpose of KPI’s is to provide the

company with quantifiable

measurements of things it has

determined are important to the

organizational or business long-term

goals and critical success factors .

Once uncovered and properly

analyzed, KPI’s can be used to

understand and improve

organizational performance and overall

success. Also referred to as Key

success indicators.

Key result areas: Used to

establish standards and objectives,

key result areas are the chief tasks

of a job identified during the job

evaluation process.

Knowledge, skills and

abilities (KSA’s) : The

attributes required to perform a job;

generally demonstrated through

qualifying experience, education or

training.

Management by Objective

(MBO) : A performance appraisal

strategy in which subordinates

determine and set goals for

themselves based on the overall goals

and objectives for the organization.

Merit pay : A compensation

system whereby base pay increases

are determined by individual

performance.

Peer appraisal : A

performance appraisal strategy

whereby an employee is reviewed by

his or her peers who have sufficient

opportunity to examine the

individual’s job performance.

Performance appraisal: A

periodic review and evaluation of an

individual's job performance.

Performance-based pay: A

variable pay strategy that pays

employees based on their individual

performance and contributions,

rather than the value of the job

they are performing.

Performance counseling :

The process of improving employee

performance and productivity by


providing the employee with feedback

regarding areas where he or she is

doing well and areas that may

require improvement.

Performance improvement

plan: A plan implemented by a

manager or supervisor that is

designed to provide employees with

constructive feedback, facilitate

discussions between an employee and

his or her supervisor regarding

performance-related issues, and

outline specific areas of performance

requiring improvement.

Performance management :

The process of maintaining or

improving employee job performance

through the use of performance

assessment tools, coaching and

counseling as well as providing

continuous feedback.

Performance monitoring :

The practice of monitoring employees

while they perform their jobs

through the use of surveillance

cameras, telephone or computer

monitoring.

Performance standards :

The tasks, functions or behavioral

requirements established by the

employer as goals to be accomplished

by an employee.

Promotion : Career advancement

within an organization, which includes

increased authority, level of

responsibility, status and pay.

Reward system : A formal or

informal program used to recognize

individual employee achievements,

such as accomplishment of goals or

projects or submission of creative

ideas.

Subordinate appraisal :

An appraisal system whereby

managerial employees are evaluated

by their subordinates.

Succession planning : The

process of identifying long-range

needs and cultivating a supply of

internal talent to meet those future

needs. Used to anticipate the future

needs of the organization and assist

in finding, assessing and developing

the human capital necessary to the

strategy of the organization.

360- degree feedback : An

appraisal process whereby an


individual is rated on his or her

performance by people who know

something about the individual’s

work. This can include direct reports,

peers, managers, customers or clients;

in fact, anybody who is credible to

the individual and is familiar with his

or her work can be included in the

feedback process. The individual

usually completes a self-assessment

exercise on his or her performance,

which is also used in the process.

Tangible rewards : Rewards

that can be physically touched or

held (i.e., a gift certificate, gifts in

the form of merchandise or a savings

bond.)


HRiday in Action:

Gyaanoday with Mr. Darryl Cabral

HELD ON: 3rd August,2012

In the first session of the year HRiday organized an

interactive workshop with Mr. Darryl I. Cabral

(Director - Human Resources in Total Solutions)

onLeadership and Decision Making. Teaches in Jamnalal

Bajaj Institute of Management Studies and IIMs. He

is also the HR OB area head at Sydenham. He

conducts workshops in Organisation Development and HR with corporates in

India and abroad.

Gyaanodaya with Mr. Noel

Noronha

HELD ON: 31st August, 2012

Continuing the trend of value addition through its

workshops, an interactive session was arranged for the

GIM student community on “How to face interviews”.


Mr. Noel Noronha, Head-HR for Asia Pacific at Syngenta India Limited, delivered the

lecture.

I know what you did last summer!!

HELD ON: 24th August 2012

The session was a one-on-one interactive session with the PGP2s who had done

their internship in projects of the HR, Marketing and Operations domains.

Hope you enjoyed reading!!

We hope reading HRiday Veda has been a time well spent! We would like you to reply back with your valuable feedback about

this issue. We are also open to your contribution for the future issues by way of articles, cartoon strips, topic suggestions, and

any relevant HR material which will benefit us as future HR managers. Also include at the end : Please share your suggestions

and feedback with us at [email protected]

People. Passion. Performance

HRiday @ G.I.M.

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HRiday Veda - July/August 2012. Theme: Performance Management

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Transcript of HRiday Veda - July/August 2012. Theme: Performance Management