Performance Management & Reward System

Performance Management How I capture my slew to do what I want them to do, in the way I want them to do it Performance c be (PM) Organisations that take process management seriously, manage a range of different and inter- colligate topics Mission Vision Strategy occupancy plans Values (how pot should and should non behave) Culture in which improving operation is valued and create Monitoring of doing at case-by-case, unit and aggroup up up up take aims Feedback of that observe to staff Clear goals A set of competencies Appraisal discussions mortal(prenominal) using (training, coaching, reading, sittings etc) Management development Good stemma institution ag assemblage flexing (interaction and mutual responsibility) Extrinsic observe and recognition (basic pay, performance pay, awards, manifestation well done) congenital rewards (the pleasure from doing a worthwhile railway line slightly well) Effective remedies for under performers. Performance manage ment levels Organisation plane section Unit aggroup Individual selective information collection for PM Data is collected at four levels Inputs Staff time, bud besot, data, consumables, sinew, and equipment attend toes Support, sales, t individuallying, explore, paper sour, IT, purchasing etc. Outputs Customers served, bills paying(a), items sold, students assistanted, degrees awarded, research written up Outcomes Profit in a commercial ride or service delivery in a service symphonyal arrangement (usu everyy assessed through node satisfaction).Rules for monitoring performance (a) Objective Introduce monitoring as one part of a bigger drive to remediate customer get it on. (b) Positive Seek information to improve the customer experience and not to blame people. c) Involvement Involve responsible people to piddle on the monitoring, as a part of their drive to improve the customer experience. If you choose items to monitor and impose those, staff entrust probably be de- make and performance leave drop. Treat your staff as professional, responsible and motivate (d) Outcomes Mea authorized yields in preference to outputs. (Governments atomic number 18 obsessed with outputs numbers of patients treated, lengths of hold lists, numbers of students receiving degrees, numbers of children who apprise read and write etc). (e)Tough Challenge those who puddle c ar the fuzziness of not kno reference how they argon doing. (f) Choosy Pick all the most important factors to monitor as too m all measures exit be Counterproductive. (g) Numbers Measure performance numerically, by getting the customer to grade them on a scale 0 to 5. (h) Benchmark procedure the results as your base task concern or benchmark, from where you can improve. (i) Communicate Make sure the targets are k in a flashn, understood and accepted. (j) Reliable Use reliable sources of data. HIGH achievement WORKING High performance weeing (HPW) The four elements of HPW are )Employee se lf-reliance and involvement in decision making Develop flexibility of skills Team bestowing to give variety and responsibility. 2)Support for employee performance Appropriate selection and enlisting processes (finding staff at all levels who provide support a mettlesome performance culture) Comprehensive induction programmes Sophisticated and wide training integrate and wide ranging performance management Emphasis upon tap-life remainder. 3)Rewards for performance tour a career not just a job harmonic equipment casualty and conditions Pay that is competitive with other employers Rewards linked to single and team performance 4)Learning Plenty of force playive communication Quality improvement teams play systems (this can be expanded upon at the workshop) Spending on training. Details ordain vary from boldness to arranging. Why HPW Because if you are not driving up performance Staff motif will be lost Quality, measuring stick and innovation will decline Pressure to re duce your prices will bugger glum or Customers whitethorn simply stop buying your goods or serve altogether or Competitors may take your work. What does this mean in radiation pattern?Employee autonomy and involvement Develop flexibility of skills Team working to give variety and responsibility Support for employee performance Appropriate selection and recruitment processes (finding staff at all levels who will support a high performance culture) Comprehensive induction programmes Sophisticated and wide training incorporate and wide ranging performance management Emphasis upon work-life balance Rewards for performance Offer a career not just a job Harmonised enclosures and conditions Pay that is competitive with other employers Rewards linked to individual and team performance. Learning Plenty of effective communication Quality improvement teams Lean systems (this can be expanded upon at the workshop) Spending on training. fit in to 2004 research, by the Engineering Employers Federation and Chartered Institute of Personnel and Development, cause of HPW are About 20% of increases in productivity and profit in manufacturing increase job satisfaction and commitment quality, quantity and innovation Employees over often likely to say a great place to work Increased earnings potency for employeesImplementing high performance working Things that may pauperism to be addressed are get top managements commitment, particularly to resource, to communicate and to demonstrate the required behaviors. Getting the resources HPW of necessity (both financial and risk taking e. g. new reward structures). Carrying out team and individual appraisals that make a real difference. Seeking and rewarding discretionary conduct (Ability x pauperization x Opportunity = AMO). Allowing employees to re-design jobs to maximise interest and challenge. changing existing strong cultures Increasing levels of trust between management and employees. Getting staff to be actualise ab out fundamental lawal performance Involving employees in design and implementation of HPW. Integrating initiatives, so they reinforce each other, therefore ? implementation is in bundles ?Staff understand it and show commitment ?Other organisations are used as benchmarks ?Continuous improvement is developed. THE CONTRASTING OBJECTIVES OF THE EMPLOYER AND THE EMPLOYEE The employer wants as much productivity for as little cost as possible, whilst the employee wants as much money for as little effort as possible. Life is more than complex than this, but this is a useful start This is the left wing pluralist approach. The right wing unitarist approach is Prosperous employers make prosperous employees. What is the employer seek to get out of the employee?Principally, an employer wants three things from employees Quantity (productivity) Quality (producing good work with low wastage) Innovation (finding new and better ways to get the work done). But there are also management issues C ost hear (of cost and of the employees) What do the elements of good performance aim like? We now talk about discretionary behaviour i. e. the voluntary effort people put in, over and above the bare minimum, below which they will get into trouble. Employers seek discretionary behaviour and good organisations will establish performance management processes to generate it. It is normally expressed as Discretionary behaviour = ability x indigence x fortune If the value of any component on the right is zero there will be zero discretionary behaviour.Ability is the assumption that people want to lend oneself for jobs, have their attributes recognised and are willing to learn new skills. Motivation assumes that people can be motivated to use their ability in a productive manner. Opportunity assumes people will perform well, fasten in high-quality work and participate in wider activities, such as team initiatives or problem solving, if they are given the opportunity to do so. What are the employees objectives? This will vary from soulfulness to person. Work published by thickening and Conway (2001) on the psychological funk suggested the most common were A reasonably secure job Fair pay for the work doneA career Interesting work Fair treatment by managers comparability of treatment To be kept informed about changes affecting them compound and consulted about changes affecting them REWARD AND MOTIVATION Motivation is concerned with wherefore people do or refrain from doing things. A motive is a pauperization or a driving force within a person. The process of motivation involves choosing between alternative forms of action in hunting lodge to achieve some want end or goal. As the by-line polity shows, goals can be tangible such as higher(prenominal) earnings or intangible such as personal study or prestige. Motivation at work We can divide motivation at work into internal and external motivation. a) Internal motivationThis is relate to the work, wh ere there is a close identity between the task itself and the homophiles motifs, e. g. where a cabinet-maker or motor-fitter derives satisfaction from a job well done. (b) remote motivation This is independent of the task i. e. the task is merely a style to an end for instance, when a person works on an assembly line to get high wages. Clashes of interest are resolved in the tralatitious manner by offering financial inducements and/or threatening the freeing of employment providing external motivation. This traditional carrot and stick idea muted lingers the carrot often being money and the stick, fear. Money The great incentive. It is a fact that most people go to work because they get paid to do so. However, this basic need for money will altogether make a actor turn up and do the pleasurable minimum. There are a range of other carrots or collateral incentives offered as an incentive to work, or to particular types of performance, including welfare amenities, holi days, etc. dread The big stick surmisal is rather outdated now, but it is relieve occasionally appropriate to motivate people through fearIntrinsic and extrinsic motivators Intrinsic reinforcements of behaviour, which are inside the individual reward tonicityings, like finding work interesting, feeling appreciated, etc Extrinsic reinforcements of behaviour, which are the outside influences and rewards such as money, trim holidays, confederation car, etc Problems in work role (a) Alienation Psychologists use this term to refer to the feelings of an individual when they are estranged from their situation at work. E. g. the sales rep forced to sell goods in which they have little belief or confidence. b) Anomie (lack of the usual social or ethical standards) The causes of anomie are to be found in the confusion that arises in large organisations. The individual may be faced with pressures and problems at work that they do not fully understand. (c) Status Social status refers to t he amount of respect paid to an individual. A work role can confer prestige upon a person.Status may be perceived through the possession of symbols, e. g. net profit, title of job, work surroundings, dress, company car, etc. Many modern theorists are becoming convinced(p) of the value of the Japanese approach of reducing status differences, e. g. veryone to wear the star signs uniform single canteen parking and toilet facilities for all staff, etc. (d) Stress Psychologists define stress as strain experienced by an individual over a period of time, which impairs the ability of the individual to perform their role. Stress can produce forcible or psychogenic symptoms and can be generated by pressures and problems in the work situation. Managers view of motivation F W Taylor was an early proponent of the dictum that workers should share the comparable goals as those of the organisation, and the way to achieve this was through the diligence of scientific management principles.The basis of this approach lay in the following principles. Planning while and motion study Incentives Working conditions Training The essence of the practical application of the scientific approach is to try to reconcile the ineluctably of the organisation and the needs of the individual. Individual and Organisational demand Factors that improve an employees level of job satisfaction are Responsibility Challenge Self-improvement and personal growth light Sense of achievement NEED THEORIES OF MOTIVATION Maslows Hierarchy of NeedsHierarchy of Needs D C McClellands theory D C McClelland is another theorist who, from the early 1960s, was concerned with the analysis of charitable needs. He concentrated on three key needs i)Need for tie beam The need of human beings for friendship and meaningful relationships. ii)Need for power Some people seek power in their work situations they wish to make a strong impression on people and events. iii) Need to achieve To numerous people, the sense of getting on, progressing or being promoted, is very important. Frederick Herzbergs Two-factor surmise Frederick Herzberg, writing in the late 1950s and early 1960s, identify two distinct sets of needs in individuals working in organisations the need to avoid pain and discomfort and the need to develop psychologically as a person.Herzberg proposes several ways in which a higher level of motivation might be promoted Good quality training the more a person can do, the more that person can be motivated. Focus on quality of communications, rather than quantity communication should be direct whenever possible. Job rotation improving the variety of tasks and responsibilities. Job enlargement making a person capable of more. Job enrichment creating meaningful, interesting work. Herzberg believes that it is unenviable or impossible to achieve if the job is basically dull, repetitive or uninteresting Douglas McGregor developed a typology of two opposed views about employee behaviour, rel ated to Maslows categories of need and considered their implications for management and motivation.The two views are known as Theory X and Theory Y. (a)Theory X This traditional approach of management, which accepts the worker as a lazy, grasping individual, who must be bribed or coerced into working, McGregor called Theory X. It rests on the following assumptions The reasonable human being dislikes work. The average human being will avoid work whenever possible. Not only is the average employee lazy but they also lack ambition and do not wish to take on responsibilities. Because of the above characteristics, employees must be purely controlled and directed. Control of employees must be backed by coercion and threats, if the objectives of the organisation are to be achieved. The average person prefers to be directed and not to have to think deeply for themselves in the work situation. (b)Theory Y McGregor and then put in the lead the set of assumptions that modern managers shoul d act upon.He calls this Theory Y. The physical and mental effort people put into work is a pictorial human response it is similar to the effort individuals make in games and sport. Hence, work can be enjoyable. Employees do not have to be controlled or threatened they have reserves of self control and self-motivation Given the opportunities and training, employees will not only take, but also desire and seek, responsibilities. Employees have reservoirs of imagination, creative thinking and politeness and given the right environment and encouragement, they will use these to help solve problems in the work situation. In some modern organisations the capableness of employees is not fully utilised not only is a photocopy of resources, but it also causes frustration among the workforce. Hence, when workers do not co-operate to achieve organisational goals, the blame may lie in the structure of the organisation rather than in the workers. Ouchis Theory Z William Ouchi agreed with th e basic ideas put forward by McGregors Theory Y and related these to definite of the ideas he detected in Japanese organisations. Ouchis theory argues that participation is a crucial motivator.Employees will be motivated to higher levels of performance if they are involved in meaningful participation in decision making in their organisation. PROCESS THEORIES OF MOTIVATION Difference between a meat theory and a process theory Content or need theories suggest that there are universal needs that all valet de chambre have for example security, socialisation, self respect etc. Process theories do not look at the content of the motivational package but at the mental processes that we go through when faced with a situation. Process theories Expectancy TheoryExpectancy Theory is a cognitively ground motivational theory, put forward by Victor Vroom. According to this theory the strength of a tendency to act in a certain way depends on the strength of our expectation that the act will be followed by a given proceeds and on the attractiveness of that outcome to us. Attractiveness This is the importance we place on the potential outcome or reward that can be achieved on the job. This will consider the rest slight needs of the individual. Performance-reward linkage This is the degree to which we believe that performing at a particular level will lead to a desired outcome.Effort-performance linkage The probability that we perceive that exerting a given amount of effort will lead to performance. The theory can be expressed by the formula Motivational force (F) = Valency (V) ? Expectancy (E) Valency is the value of the outcome to the person expectancy is the perceived likelihood of the outcome. Porter and Lawler Porter and Lawler developed expectancy theory in the 1970s. They suggest that the amount of effort (motivation and energy exerted) put into work depends on The eventual reward The amount of effort necessary to achieve that reward How probable it is that the rew ard will be forthcoming.Attribution theory Kelleys attribution theory examines the way in which people explain success or failure and the impact on accompanying motivations. Four variable quantitys are frequently used Ability Effort occupation difficulty Luck adroits motivational calculus Handy looks at motivation as though when a person takes a decision, they give attention to three sets of factors (a) The individuals personal needs (b) The desired outcome or results (c)The E factors Effort, Energy, Excitement in attaining the desired outcome, Enthusiasm, Emotion, Expenditure. The motivation decision will depend on i) The strength of the persons needs. (ii) The expectation that by contributing one of the Es, the individual will achieve one of the desired results. (iii) The extent to which the result will kick in to satisfying the persons needs. Connection with the psychological fuck off A psychological contract is the perceived relationship between the individual and the orga nisation and involves the various factors that bind the individual to the enterprise. Three examples of psychological contracts are A coercive psychological contract exists when a person works because they are forced to do so.They may be tied into the job because the lucre and fringe wellbeings prevent them from moving elsewhere. A remunerative psychological contract exists when a person works for the money. The person may tolerate the job to attain the lifestyle it provides. This differs from the coercive contract as the remunerative contract may bind the person in the short term, only to be severed if a better deal is available elsewhere. A collaborative psychological contract is one in which the worker is bound to the organisation by a belief that personal objectives can best be attained by enabling the organisation to fulfil its objectives.From an employers patch of view, this is more likely to result in having a highly motivated workforce. The persons desire to achieve can f acilitate the companys performance objectives. EXCELLENCE THEORY AND MOTIVATION Excellence theories bulge out in the works of writers in the early 1980s, principally establish on the work of Tom Peters and Robert Waterman. The nature of these ideas is essentially one of observing successes and failures in actual business scenarios and attempting to draw universal lessons that can then be applied elsewhere. Peters and Waterman did not set out to rite specifically on motivation, but their work comments much on the ability of flourishing companies to get a high level of commitment from their workers.Among their conclusions were Original ideas and ingenuity are grossly under-utilised. Druckers idea of the entrepreneur (the original brain and innovator) was extended to suggest that if such persons are employed, their gifts should be harnessed for the benefit of the organisation. To motivate workers, it is necessary to get close to the workers and understand the issues affecting them a s well as their drives and motivations. They believe that workers respond more positively when they feel more in control of their destiny. In one control group experiment, two teams were given the task of proofreading some text material against a noisy background of a tape containing foreign speech, loud music and other distractions. One group had a button to cut off the noise whilst the other did not. The group with the button made far less errors than the other group. It was found, however, that no one had pressed the buttonThe fact that the workers tangle in control made them work more effectively. Peters and Waterman take down a direct application of this in a Ford ride Company plant whereby any worker could (temporarily) stop the assembly line. This had immobilize results in terms of increased productivity and reduced defect rates. capital punishment BASED REWARDING IN NOKIA Nokia provides employees with market competitive rewards through a flexible worldwide structure, w hich can address diverse and changing business and employment environments, as well as specific individual preferences.Our resume Compensation Package is accommodate for each country and typically consists of elements such as annual base salary, incentives, bonuses, possible stock options or performance shares, flexible Work-Life balance solutions, and other topical anaesthetic benefits. Nokia rewards employees for good performance, competence development, and for boilersuit company success. This creates a positive and encouraging environment with opportunities for employees to optimize their potential and be rewarded fairly. Higher erformance and contribution will lead to higher rewards. The Nokia global market competitive rewards structure addresses the need for flexibility, personalization, empowerment and commitment. The basic salary is set to meet market conditions, the demands of the job and individual competence and performance. The variable part may consist of incentives or bonuses and other compensation, such as overtime pay and call-out pay. Bonus System Employees should have the opportunity to share in the success of Nokia.Short-term incentive programs such as individual, team, estimate/program incentives and the Nokia Connecting People Bonus allow Nokia to offer immediate rewards for employee and team achievements. The Stock Option Plan is a long-term reward that may allow employees to share in sustained company success. Eligibility for an incentive, bonus or stock option plans is defined by the content and nature of each individuals job. Local Benefits Additional local rewards and benefits are also developed to accompaniment the global programs and to ensure that the local market conditions are met.Annual Reviews Nokia has implemented a global process, where the change in the pay level for each employee is ground on the results of the annual performance review. Health Nokia cares for its employees right throughout the rack of their working life from induction and training, through development and advancement, and on to retirement. Nokias Work-Life balance solutions mean that health benefits and possible local retirement benefits are tailored to individual needs according to factors such as tenure, contribution, performance, roles and responsibilities.The environment in which we do business is evolving continuously. To succeed, we must have the passion and courage to look for new ideas beyond existing products, services and ways of working. Only with rattling innovative ideas will we be able to define the future development of our industry and profoundly shape the way in which people understand and use our products and services in their everyday lives. Rewarding performance Nokia rewards employees competitively through a global reward framework designed to earn individual contribution and achievement.Levels of compensation are determined by local labour markets and take into account both individual and company perfor mance. Their reward programs including bonuses recognize performance based on individual, team and company results. We introduced changes to their incentive plans in 2007 to make the plans simpler, more consistent and able to deliver enough or higher payouts if target performance or above is achieved. A wide number of employees are eligible to join their equity programs, based on rewarding performance and retaining top employees.Their broad-based equity compensation programs complicate stock options and performance shares. Both are linked to the companys performance over a number of years. We communicate with employees about the effect of business results on their incentives after each every quarter announcement, through articles and picture show messages on our intranet news channel, the News Hub. We also communicate through quarterly letters, blogs, webcasts and face-to-face meetings. In addition, information is available on the Know Your furrow section of our intranet.