The-Challenges-in-Employee-Performance-Management

The Challenges in Employee Performance Management in the 21st Century

The Challenges in Employee Performance Management in the 21st Century

1. What is Employee Performance Management?

Employee performance management (EPM) is both a science and art in management approach to retain and grow a high-performance culture within any companies and teams. Many business owners think that it a one size fits all and often they get disappointed. EPM’s primary objective is to create the best in every employee in alignment with the company’s vision and mission.

In reality, EPM is often different from one company to another as it depends on the nature of business, cultural backgrounds and values. Example an IT multinational company in United States versus a home cooked café in Japan. It also will differs depending on the position and job function. Example a Finance Manager versus a Receptionist.

There are no set of hard and fast rules in EPM. This made it very challenging for many Small Medium Enterprises (SMEs) as they usually do not have a whole Human Resource Department to manage this as it requires a certain level of customisation and adjustments based on business to business. This is where InTune can provide HR Consultancy to set this up on top of our Payroll Outsourcing.

Generally the performance appraisal criteria is split between Quantitative ie something that can be measured specifically such as Sales Numbers, Production Numbers, Time to Completion and Qualitative ie something that is evaluated based on a range from feedback and rating of the person based on certain descriptive attributes such as are behavioral traits, problem solving skills & willingness to learn, team work and etc.

Both Quantitative and Qualitative must encompasses SMARTER Key Performance Indicators (KPI) where SMARTER stands for

  • Specific. Deliverables that are clear and specific that is linked back to both their job descriptions and KPIs. This is being mapped upon employment as part of confirmation and it will also entails mid term, yearly and long term results.
  • Measurable. A measurement to capture information is in place to measure where the employee is at any point of time based on an agreed cut off.
  • Achievable. It must be something that the employee is able to create and deliver reasonably and it must be something within their job scope and responsibilities that has been agreed with the employee.
  • Result Based. At the end, it must led to a result check that allows both employers and employees to benchmark their actual results against aligned targets and/or goals.
  • Time Based. It must be reviewed frequently and within a period of time such as monthly, quarterly or yearly. This allowed both employers and employees to take corrective actions and adjustments can be made from time to time as at when needed.
  • Extending. ie employees are clear of the minimum target that is required of them, agreed target for the period and when would it mean that employees are performing exceeding the agreed targets. This provides an environment for employees to continue to stretch and grow with the company.
  • Rewarding. The biggest part of the relationship between employers and employees lies in the reward and sharing of the rewards achieved by the company as an incentive and motivation as well as retention strategy for the employees. It is the nature of employees to look for achievements and success.

Based on above, it will take time to craft these things out and it will be different from time to time. Covid 19 Pandemic is a classic example where selling and delivery of food alone has evolved so much from e ordering to e delivery and e payment.

This is where InTune can provide the HR Consultancy to set up the EPM for our clients and for our retainer clients, InTune will review it from time to time where necessary and HR have a cloud-based Human Resource Management System (HRMS) that is on subscription basis that can document all the SMARTER KPI over the cloud for easy access 24/7. InTune can facilitate from coming up with job descriptions and Key Performance Indicator to Key Performance Indicator Management.

2. What is Performance Appraisal?

As mentioned above, performance appraisal is the key to a successful EPM. There are many frequencies to have performance appraisal. At the very least is the annual performance appraisal where it is done once a year. This is the traditional approach. A more recommended approach currently is continuous performance appraisal based on the monthly result check for organization to be able to steer their workforce better.

A performance appraisal also includes recognition and acknowledgement of the results created and achieved beyond the areas where are off track and requires improvement. A holistic EPM involves a good deal of data compilation, paperwork, spreadsheets, or various presentations to share and review work as part of Result Check.

It takes up a lot of time and resources for both management and staffs on top of the HR Department involvement to execute this necessary part. As such it is critical to mapped the required data where possible to both a HRMS and an Accounting System so that Employers can quickly access to real-time information for feedback, regular review meetings, coaching, discussions on possible areas of improvement, and work adjustments.

This is another area that InTune can assist where we provide HRMS solutions as well as both Accounting Outsourcing (Finance Outsourcing) to our clients were InTune can mapped all these requirements at the point of implementation which will include Performance Appraisal Consultancy.

InTune will provide both the tools and structure for the Performance Appraisal that can be either executed by our clients independently or with InTune HR Team. Also the HRMS can be implemented in stages in accordance to the level of the business growth and requirement.

With an integrated and seamless systems that can provide data, this will enables both the employers and employees to know where they are against where they planned to be, what are they good at, what they are weak at and where is their performance gap for both employers and employees to adjust and adapt where required better.

An example will be Productivity by Project and by Division to measure the performance of Multi Production Lines and also the performance of the Product Line on a project to project basis that is tied to the sales person too from the Accounting System. This allow Business Owners to manage both Production and Sales easily.

Each staff will also have both the Job Descriptions and SMARTER KPI within the HRMS where each staff can access online and undertake a preliminary self evaluation before the formal appraisal with the management. This saves a lot of time of photocopying and coming out with multiple report that require multiple organisation and sorting of raw data.

3. How does this lead to better satisfaction for Employer and Employees as a win-win solution?

For Employees

  1. Increased Work Satisfaction
  2. Reduction of Unnecessary Conflicts and Enhances both output in Effectiveness and Efficiency
  3. Alignment and realignment with Organizational Goals
  4. Better Opportunities for Growth and Upgrade of Staffs

For Employers

  1. High Visibilities and High Adjustability in Areas of Improvement
  2. Increased Employees Engagement, Happiness and Motivation
  3. Reduces Unnecessary Attrition amongst the workforce
  4. Higher Company Success
  5. Creates an environment for Growth and Succession Planning

4. Conclusion

EPM is an essential part in managing, growing and retaining talents for the 21st century and it can be customised to Small Medium Enterprises (SME)s depending on where they are. There are tools that can be used and it can be integrated to make the whole process much more easier. Talk to us at www.intune.my today.