Development of Performance Management System for a Leading Jewellery Brand
With the thought of abandoning annual evaluations and rankings, employee performance management was becoming a tough task for one of our clients. This client happened to be a leading jewellery brand with presence in all the prominent cities of North India. The Marketing team had plans for rapid business development and expansion across various other cities of India. The HR team had understood that the current performance management system is futile. The Store Managers were providing verbal feedback to the employees and the HR department. It was also observed by the HR department that the feedback provided in the reviews was biased and depended on the perspective of the Store Managers. Moreover, since the performance reviews were conducted annually, there was a very little scope for implementation of corrective measures, recorded from the performance review. Many employees were also not convinced with their annual ratings and hence providing real time feedback across geographies was another challenge for the HR department. The HR Head was also apprehensive about the practices which could be instituted instead of traditional approach of performance management. Most of all, the HR Head was concerned about convincing the Management and the employees as to why the HR department is “blowing up” traditional HR practices, was again a very difficult task. Addressing the elephant in the room, was how to create, maintain and support a successful real-time Performance Management System to make sure it delivers on its potential and is successfully implemented in the organization.
That’s when the assignment was given to the Human Resource Advisory Team of 3EA. Our experts understood the current performance management, its shortcomings, and benchmarked the Performance Management System of the competitors against our client. We observed that providing real-time peer reviews was a critical factor in implementation of a progressive Performance Management System. The competitors who were market leaders provided instant and continuous recognition of positive behaviour of employees. They also mapped more affluent data on employees, offering their immediate managers a clearer picture of the team. They were also monitoring company’s strengths and weaknesses through their Performance Management System and were not just focused on the performance of the employees. Market leaders were focused on implementation of positive core of their organization, which included the culture of praise, appreciation and immediate acknowledgment that an employee is doing great work, as such positive reinforcement boosted employee retention, productivity, creativity, and attainment of business objectives.
Post our analysis, we chalked out the broad objectives that the organization had to achieve by restructuring their performance management system, which are listed below:
- Implementation of a progressive performance management system which provides real-time peer reviews
- Mechanism should be in such a way that instant and continuous recognition of positive behaviour of employees is made
- Development of an IT based tool which helped the organization to map more affluent data on employees, offering their immediate managers a clearer picture of a team
- Implementation of a performance management system which monitors company’s strengths and weaknesses, broadly through the perspectives such as Financial Performance, Customer Satisfaction, Business Efficiency and Organizational Capacity building
- Implementation of a performance management system which boosts employee retention, productivity, creativity, and attainment of business objectives of the organization
The experts of 3EA were given the assignment of develop, maintain and support a successful real-time peer review program to make sure it delivers on its potential. We discovered that the Nine Box Tool will be an effective management tool for the organization and developed a step by step plan for implementation of this performance management system. We asked the organization to reflect on it’s core values. We ensured that the key indicators on which people are recognized are aligned with the company’s vision and embraced new technology as today’s workforce is multi-generational and global. The peer reviews were planned in a way that they didn’t feel like additional work. We wanted to position the performance management program as a change exercise designed to help recognize and celebrate employees, and not a new way to monitor or judge them. We also asked senior executives to support actively and communicate the effectiveness of the plan to all the employees. The Nine-Box Tool uses the following methodology of providing employee rating :
a) Performance Rating based on Achievement on Targets, which are to be accomplished by the employees as part of their current job responsibilities
b) Potential Rating based on Customer Feedback and Behavioural Competencies of an employee required for a particular job profile
The following diagram showcases a nine-box tool
The description of the profiles are mentioned below:
These are the kind of employees who are completely wasted in an organization. They are the people with high potential but deliver low performance. They are either wrongly placed or are working under wrong managers who have been unable to harness their full potential. This scenario requires external intervention and a heart to heart with the employee and the manager can yield good results.
The employees have average potential but showing low-performance fall under this category. The reason could be many: not upgrading as per the job requirement, not falling in line with the changes in the company. They can perform better if given proper opportunities and motivation.
These employees are individuals with low potential coupled with low performance. They underperform and don’t show any scope for improvement. Here the management has to take a tough decision of either throwing the ball in their court and giving them some time to improve their performance or asking them to leave the organization.
This category has employees that constantly show high potential but the performance is not up to that standard. They may not be getting enough motivation or inspiration to move forward. The company should value the talent and should try to extract the best out of every employee. These kinds of employees can become great assets for the company by giving them enough challenges and by praising them as they achieve goals. It further instills a sense of confidence and the performance is bound to increase.
This category has employees that more or less perform up to the job potential but there is always a chance to achieve higher performance by giving them the necessary push. They are just like employees in the category dilemma but are more promising.
These are people with specific talents as they show higher performance as compared to their potential. They may have reached their full career potential so here the talent management team can keep them engaged, focused and motivated to get the desired results.
These employees are the leaders of tomorrow and are the best possible options for succession at senior positions. They depict leadership qualities and yield results. People listen to them and they know how to get the work done. The talent management team should recognize their efforts and should reward them appropriately. Promote them and give them the chance to grow as an individual and also as a part of the organization.
High impact performers are those who by some grooming and motivation can become the future leaders. They may have lost pace with the changes in the organization like dilemma and core employees but can be among the top talent.
Trusted professionals perform much higher than their potential because of some special talent they may be having. Your effort should be to retain them by rewarding and recognizing their efforts. You can always take their help to develop high performers.
The implementation of the nine-box tool led to 50 recognition moments in the program’s first week, 80 in the first three months, and 40% of all employees participating within the first 90 days. The HR Head made sure that all the employees, at any level, feel empowered to participate. Through various counseling sessions, it was also ensured that positive and public feedback should be given to all the employees. It was also ensured that senior-level management appreciated and recognized the efforts of even the entry-level employees and vice versa. Overall, the company achieved its objective of implementing an online performance management system that provides real-time peer reviews which helped the organization to map more affluent data on employees, offering their immediate managers a clearer picture of a team. The organization also achieved its goals in terms of the targets set for Financial Performance, Customer Satisfaction, Business Efficiency, and Organizational Capacity Building. The employee retention levels rose by 20% and productivity levels rose by 50%, thereby leading to the attainment of business objectives of the organization.