Performance management is the process of creating a work environment or setting in which
people are enabled to perform to the best of their abilities. Performance management is a whole work system that begins when a job is defined as needed. It ends when an employee leaves your organization. It includes performance appraisal, training and development and other benefits. Origin The purpose of this project was to find out how an organization manages it all employees to have better productivity to contribute to the business success. Objective As we chose AI limited for our project, we tried to delve into the performance management system of the organization to know how they are managing the vast employees successfully. Scope !hile doing this project, we understood practically how important the employees are for the success of any organization. And why it is important for any organization to mange an effective performance management system. 1 Methodology The information used in this report was collected by consulting the "# e$ecutive and some employees of AI. %esides, some information was collected from net. Limitations It was not possible to interview all the employees of AI since they have more than &'(( employees. )ome of the information was not available due to their company confidentiality. 2 Organization Background Advanced hemical Industries *AI+ ,imited is one of the leading companies in %angladesh, with a multinational heritage. AI was established as the subsidiary of Imperial hemical Industries *II+ in the then -ast Pakistan in ./&0. After independence the company has been incorporated in %angladesh on the 12th of 3anuary ./45 as II %angladesh 6anufacturers ,imited and also as Public ,imited ompany. This ompany also obtained listing with 7haka )tock -$change on 10 7ecember, ./4& and its first trading of shares took place on / 6arch, .//2. ,ater on ' 6ay, .//1, II plc divested 4(8 of its shareholding to local management. )ubse9uently the company was registered in the name of Advanced hemical Industries ,imited. ,isting with hittagong )tock -$change was made on 11 :ctober .//'. )ubse9uently the company was registered in the name of Advanced hemical Industries ,imited *AI+ The trading subsidiary of AI represents in %angladesh principals like ici, e$$on;mobile, bayer, stahl and ici uni9uema. )trategic business unit< Pharmaceuticals onsumer %rands Agri %usiness rop are = Public "ealth Animal "ealth AI has the following subsidiaries< AI >ormulations ,td. AI Trading ,td. Ape$ ,eather raft ,imited AI )alt ,imited 3 AI >oods ,imited AI Pure >lour ,imited Mission Statement of AI ACIs mission is to enrich the quality of life of people through responsible application of knowledge, skills and technology. ACI is committed to the pursuit of excellence through worldclass products, inno!ati!e processes and empowered employees to pro!ide the highest le!el of satisfaction to its customers. !alues of AI "uality Customer #ocus #airness $ransparency Continuous Impro!ements Inno!ation "uman #esource $epartment of AI 4 AI "# works with a vision for creating a work;environment to foster creativity, innovation and productivity for achieving business e$cellence through dynamic and dedicated people. They believe that "uman #esources are the most important asset of the organization. They identify the training needs and provide trainings accordingly to develop the knowledge and skills of their human resources. Thought ,eadership and Team %uilding meetings are conducted on a regular basis. They provide an enabling working environment to unleash the full potential of the employees and a performance based career progression. AI has more than &'(( employees working in this organization. Their mission is to achieve business e$cellence through 9uality by understanding, accepting, meeting and e$ceeding customer e$pectations. They practice modern "# Policies and procedures for #ecruitment = )election, 6anpower Planning and succession planning. The "# department is run by 7irector orporate Affair is )hima Abed #ahman. ?nder her supervision )hamim >erdous manages all employees. Analysis 5 !hile conducting the report we got to know the motivation techni9ues of AI, their motivation and development programs and their salaries = bonus systems which motivate their employees. :ur analysis on these topics is e$tended in this section. AI%s Motivation &echni'ues Performance appraisal is the process of identifying and evaluating employee performance to make sure they contribute to the organizational goals. AI@s appraisal techni9ues are; (aired omparison) It helps to make the ranking method more precise. According to this techni9ue employees will be listed in all possible pairs for each trait *e.g. how much products are sold in one week+ and it helps to indicate which is better of each pair. This is practiced only for the sales people. (erformance Appraisal *orm) -ach employee is given a form which is filled in consultation with the supervisor to identify what are the needs of the employee to develop his skill further not only to perform his responsibility better but also for taking future responsibility. +eekly Meetings) 6 The organization arranges meetings for employees every week to review their performance throughout the week. The employees share their problems and ideas about work and other job related factors and the supervisors can have updates about how things are going on in each sector of the organization. S+O& analysis) %esides the management committee the employees also try to find out their strengths and weaknesses within the organization and the e$ternal opportunities and threats they may face. Scanning ,-ternal ,nvironment) AI often scans the e$ternal environment for comparing similar industry practices. AI revise the remuneration and compensation schemes of them by comparing the job facilities provided by the competing firms. AI practices it to increase employee satisfaction and decrease employee turnover rate. This is mainly used to decide the salaries of employees. ,mployee onsultancy) 7 onsultants talk with employees individually to know about their ongoing work; whether they are facing any problems or anything. The consultants try to figure out if an employee is facing problem in working with co;workers or having problem in adapting any new company policy. The consultants also try to point out if a particular employee is satisfied with his or her job responsibilities and performance. Brainstorming) -mployees arrange brainstorming sessions to share their ideas and knowledge about their upcoming works. They also discuss about their e$perience and problems of their current works with each other. In these sessions the employees are given a problem and each employee comes up with different types of solutions of the problem and from all these solutions the most feasible solution is taken up and employees all together start to work on that. Balanced Score ards) AI uses %) for its all business units e$cept the agro base sector to measure their employee performance. ,-ecutives . Managers Appraisal) 8 67, 7irectors and subordinates do this. This is a bottom;top approach of appraisal techni9ue. In this appraisal techni9ue subordinates@ performance affect managers@ performance appraisal e.g. if a sales manager is given a target of selling ten thousand pharmaceutical products in one week then he would assign his sales e$ecutives to accomplish this job and in such case the manager@s performance would depend on how successfully the sales e$ecutives perform their jobs. Survey for diversified /orkforce) AI is an e9ual opportunity employer and it follows the principle of diversity in recruitment, training and giving opportunity to its employees for career progression and growth. The company has a mi$ed workforce from all parts of the country from different religious background. The employee benefits package of the company was developed with the intention for the entire employee to have access to his right as part of the AI family. #egular survey is conducted to find out whether diversified workforce is working as one single team. 0raphic rating scale) This appraisal techni9ue is to find out employees@ performance level. -mployee who is the highest or lowest on the characteristics are being measured. -ach employee is rated in the scale of .;/. Succession (lanning) 9 This techni9ue is conducted to fill e$ecutive positions. The employees who show promising performance are selected and given ade9uate training and provided with appropriate development sessions to improve their level of skill and be eligible for the future e$ecutives. AI prefer in succession planning rather than recruiting e$ecutives from outside because of its cost effectiveness and it takes less time to grip the job responsibilities for current employees. The succession planning is also helpful to develop morale among the employees and they become more dedicated towards their work. Monthly employee Meeting) The organization held meetings between supervisors and subordinates to review their performance throughout the month. These sessions are very effective appraisal techni9ue for the employees as these make flow of information and e$perience throughout the organization and help the employees to enrich their knowledge. Individual $epartment Survey) 10 These surveys are conducted at the end of every month. 6ainly sales department of every sector and inventory management department of chemical, pharmaceuticals and agro based business of AI need fre9uent review. MBO) This appraisal techni9ue is used primarily for the farmers under the agro;based unit and sales people. In this case the employees are given some specific task e.g. selling a particular product, measurable e.g. selling ten thousand products, achievable, realistic and within a time frame e.g. selling ten thousand product within a week for a very skilled group of sales e$ecutives, to accomplish. AI%s (erformance &raining and $evelopment (rograms 11 The term training refers to the ac9uisition of knowledge, skills, and competencies as a result of the teaching of vocational or practical skills and knowledge that relate to specific useful competencies. In another word training is he process of providing employees with the knowledge, skills and attitudes they need to successfully perform their job. At AI when a training program is run, an evaluation takes place not only after the training but also prior to the training to find the learning that the person got from the training. All training needs which are identified in the review are included in the training plan of the company to the development and growth of the employee. They can train 5((;2(( employees at a time. AI recognizes the responsibility to enhance the employee@s opportunity to develop competence level for ensuring satisfactory performance. The training program includes some of the following as mentioned below< Training Aeed Assessment = Performance 7evelopment Planning Training Plan Training 7esign = 7evelopment Training -valuation 6anagement 7evelopment Plan 12 Individual 7evelopment Plan oaching) oaching is an ongoing training process that is especially designed to promote work efficiency and makes the new employees familiar with the working condition of the organization. Actually it is a programme that makes the fresh recruits employees of AI limited. Actually it is a training method that is organized by almost all the standard organizations. The specialty of this process in AI is that it is an on;the;job training that takes place in the usual working condition. It is very effective in a sense that this method instills a sense of familiarity with the new environment in the minds of the new employees which is a must for the organization. Monthly Seminars) As the name suggests, monthly seminar is held once a month. It is a way of judge the continued functions of AI with that of its competitors. At present this business organization is running three business units< Pharmaceuticals, onsumer %rands and Agro %usiness. >urthermore, it has twelve subsidiaries and joint ventures. In the seminars, numerous data of AI and its competitors continuing business is presented before the employees. ,ater on analysis and comparison among various data is done to figure out the do@s and don@t@s of AI@s future business. Apart from future business planning, in the seminars, evaluating past performances and finding out the faults are also highly prioritized. 1ob #otation) 13 This particular method is an inter;organization process that is directed towards the prospective e$ecutives. >irst, the higher authority of AI limited selects some potential e$ecutives who have the 9ualities to lead AI in future from the front line. To make these future managers well ac9uainted with the different facets of AI, the higher authority rotates them to different departments on a fre9uent basis; sometimes on weekly and sometimes on daily basis. This techni9ue gives the probable e$ecutives better understanding about the diversified businesses AI is running. Skill $iversity) Although it has a different name, skill diversity is another form of job rotation that takes place in almost all the levels. To diversify the employers@ e$perience, rotation from one department to another related department takes place within the arena of the organization. #otating an employee from accounts to treasury department is one of the most common practices that can be categorized under skill diversity. 6onotony is an outcome of any regular work. !hen an employee has to go through a specific work plan over and over again he or she may not find the job interesting. Through skill diversity this clumsiness in the work environment can largely be solved. Inside &raining) 14 It is specially designed to figure out the lacking of the e$isting employees and what sorts of measures are needed to develop their skills. This is mostly done by people from different private universities who are specialists in the respective field. )ometimes, e$perts from abroad also conduct this in;house training on performance measures. This training helps the employees to identify their weaknesses in their day to day job and grow e$tensively in their work. %esides, it assists them in learning the contemporary methods and thoughts regarding their job responsibility and team work which enables them to become more efficient and motivated. Outside &raining) This form of training takes place in organizations similar to AI or where the work environment and job responsibility are almost same. At first, the organization decides whether the training is relevant and valuable for the employees or not. After evaluating, if the training is found to be up to the mark, employees are chosen for the training. :ther organizations also practice this routine in terms of A. Training of this kind provides innovativeness and builds more efficiency as the training takes place in a new environment. -mployees can learn some new strategies which are not implemented in their organization and afterwards, if fruitful, they can use them in their work. In addition, AI also do not have to go through the hazards of organizing the training. *armer training) practical training 15 )ince AI puts a lot of emphasis on its agro products, it conducts a third form of training focusing on its agro;based consumers, farmers. It usually takes place nationwide, close to the farmers but occasionally, held inside the organization. 7uring the training period, farmers learn firsthand how to ma$imize the utility of seed, fertilizers and what time of the year is appropriate for planting. There is a special group of employees devoted to this cause only who train and teach the farmers all these. AI has a practical setup to simulate this process. This training enables the farmer to gain knowledge about scientific ways of cultivation and helps them enhance their productivity. Strategic Learning #oadmap) The in;house session sometimes also design a roadmap for some short; term goals which creates a path for the employee future development. >or e$ample, the trainers may set a goal which the employees have to achieve may be within two or three months. :nce it is done, then another roadmap may be set for another period of time in ne$t session. Leadership Skill) )pecial trainings are given to all the employee as per the job re9uirements and also to enhance their leadership skills for future developments. This is e$tremely necessary as AI wants its employees to develop themselves as the future leaders of the organization. Informal training for diversity) 16 This is done fre9uently without any prefi$ date or schedule. -mployees themselves conduct this training session among themselves where they talk about their strength and weaknesses and share there their e$periences and views on how to overcome the drawbacks. Another benefit of it is that it strengthens the bond among the employees and helps bringing a friendly work environment. AI%s Salaries2 Bonus and Other Benefits Salary) The salaries of the different levels of the organizational hierarchy are decided through e$ternal environmental scanning and industry standards. %y this method the company decides its position as an employer among other companies B whether it wants to pay more or less than another. Leave *air Assistance Bonus < -mployees are given a special ' days leave bonus as a sign of goodwill by the company, giving the employees a few days off to spend some 9uality time with their loved ones at home. The company encourages employees to take consecutively ' days leave. %ecause working through the whole month and year creates pressure on them which makes the employees dissatisfied. %ut AI want happy employees. That is why they give this bonus to have happy and productive workforce. &he Best ,mployee A/ard < 17 AI never overlooks employees@ contribution to the company. Their efforts are rewarded and well appreciated by the company. These employees are used be set as e$amples to others working in the organization. The employees are evaluated through 5&( degree scale rating system consisting of a total of / points. The highest rated ones are given the award. (erformance Bonus < Performance bonus and sales bonus are given to the employees, calculated by special formulas. These bonuses are decided by comparison of their target given to them at the beginning of the month and compared to their achievements to those targets by the end of the month. This bonus is a greater significant part of the income mainly for the sales people. *estival Bonus < >estival bonuses are offered to the employees on -id. This is usually a percentage bonus that is added to their salaries. >estival bonus does not include yearend bonus which is actually a case of profit sharing that I will discuss later in the presentation. #egular Sales Bonus < %y the end of the year, employees get a percentage of their annual achievement that gets added to their salaries. This initiative unifies the employee@s individual goals to the company@s. Thus 18 having them to work harder to get more profits by the end of the year because they will earn more. 0ratuity Scheme < A gratuity is paid to employees at the end of a fi$ed term contract and is often based on their remuneration and length of the contract. %y setting up and participating in a Cratuity )cheme, AI can prepare and plan for their contract gratuity obligations by building up a special fund that is managed and looked after by investment professionals. (rovident *und < -mployeesD Provident >und )cheme means an employee who having been a member of the fund has withdraw the full amount of accumulation in the fund on retirement from service after attaining the age of '' years. At AI it mainly deals with retirement. Medical #ules for all (ermanent Management Staff) AI is giving .(8 of their basic salary as medical treatment to the employees. In any emergency, they are getting a large sum amount from the employee fund. Annual (ayments to Management Staff) This company is giving various types of compensations to the workers at the end of the year. 19 &elephone at #esidence< AI is giving land phones to the residence of the employees especially the higher ranked officers for immediate contacting to them and for their personal service at home. (olicy on Mobile (hone< In modern age cell phone is necessary to maintain communication with the employees who are working at outside or mobile workers and to contact the officers especially marketing and sales officers who are outside the office often for official purpose. They are getting a fi$ed charge of cell phone bill based on their salary. (rocedure for Staff anteen< They are supplying foods at canteen for only for their employees at a very cheap rate where foods are made inside the canteen and made by a clean process for a better health. Scholarship Scheme< The children of employees who have e$tra merit are getting scholarship from the company so the employees get motivated in their works and they can feel pure loyalty for the company.
The performance of the organization@s people is what actually generates money for the company to work on. It is necessary that they be kept well and their needs be looked upon carefully and 20 fairly. Periodical audits are done by the "uman #esources department to ensure that all these techni9ues are rightly implemented and monitored at all levels to boost the performances of their employees. This keeps the company well aligned and robust. *indings After all these analysis we have found some information which are the key to the success of AI limited. They are; AI consider its workforce the most valuable asset to the organization :ne of their missions is to achieve business e$cellence through 9uality by understanding, accepting, meeting and e$ceeding customer e$pectations. They are continuously identifying their employee needs and performance and according to them developing plans to improve the efficiency of their employees. All of their training, appraisal, and benefit packages are to maintain a happy, productive and successful workforce. AI ,imited is committed to provide a working and social environment in which the rights and dignity of all its members are respected, and which is free from discrimination, prejudice, intimidation and all forms of harassment. 21 AI is an e9ual opportunity employer and it follows the principle of diversity in recruitment, training and giving opportunity to its employees for career progression and growth. onclusion of Analysis After all these analysis, we have come to the idea that; even though AI have a big workforce with more than &'(( employees, it successfully run the training programs for them by identifying their needs during appraisal session. !hich results in very low employees turnover rate and powerful workforce. #ecommendations :ur recommendations include Training on -thical %ehavior, -$tra 6edical facility and )afety and "ealth bonus for workers under the pharmaceutical unit, and more training for diversified workforce to reduce the differences. It is very tough to recover a ruined image caused due to unethical practices done by employees. )trict measures need to be taken to resolve that which may include supporting other employees to state their complaints on unethical practices to the "# and Admin. )afety precautions are needed where dangerous e9uipments are handled at the pharmaceutical unit. )ome employees are e$posed to numerous chemicals which may pose threat to employees@ health. This may need to be taken into deep consideration. 22 There has also been a lot of cases where employees do not perform at the same level they are suppose to in even some of the simplest of tasks. This is primarily attributed to the lack of training given to the employees. The training and development of AI for the employees should be made more through and tougher in ways that makes all employees@ performance same across the company. This would help keep performances measureable by the upper management which is very important in planning. onclusion -ven though AI face some problems like every other organization, it manages to deal with the employee problems effectively which ensures the employees@ satisfaction and company@s success and thus has made the organization one of the leading companies in our country. 23