Performance Management in the IT Sector

Company Objective for PMS

A process to Plan Implement Review Your performance & prepare you to
Take higher responsibilities Achieve personal & Organizational goals

Employee

Clarity on expectations Meet aspirations Transparency Frequent feedback Common standards

Organization

Healthy relationship Merit performance Align Organizational & individual goals Appreciative & developmental culture

Mentor developing & creating leaders Assessment recordperformance trend Clarity on goals set

Supervisor

Performance Life Cycle

Goals and Objective Settings immediately after

annual appraisal Confirmation Appraisal only for new hires (within 1 year of joining) Interim Appraisal October Annual Appraisal March

Process and Systems

Goal Setting
Done with employee and supervisors consent Individual goals set in line with department and organization goals SMART Goals

Mid-year Review

Re-look at the G&O set & assess performance and provide feedback

Self Appraisal

Self appraisal to be filled against each goal Key competency areas to be filled and self rated Reports or emails to substantiate the performance

Supervisor Assessment

Rates against each objective and gives overall rating Fair assessment of performance based on incident diary Strengths captured correctly

Review

Reviews done by next level supervisor and HR Ensuring that fair rating is given Subsequent review with supervisor on action on development areas

Know the strength and development areas Understand what went well and what could have been done better Appraisal Discuss development actions, aspirations & plan for next year Discussion Freeze objectives for the coming year Identify & plan Training & development initiatives for the year

The Performance Rating Scale

Outstanding-Contribution is recognized within

the group and through a wider population Exceeds Expectations-Continuously delivers with an extra bit Meets Expectations-Meets the objectives set Needs improvement-Needs to improve their performance. Done through performance plan and careful coaching and feedback

Implementation issues
Issues How Organizations Overcome Lack of willingness to fill the Communication from top appraisal forms which leads to delay management to carry out the in the process. process. This is done to ensure accountability. Supervisors assessment Training provided to supervisors to explain them the importance of Performance Management and how to assess the performance of the employees Initially it created a lot of problem in linking compensation and pay hikes etc to performance of an individual employee. It was done informally by respective managers and on an adhoc basis. Now they have developed a pay hike performance matrix. This is applicable for

Linking compensation to performance

Employee Motivation and its measurement

Employees are motivated because PMS Give feedback on performance which helps in self development Identifies the training needs of an employee. Maps career aspirations of the employee to growth opportunities in the organizations Form a basis for decisions like salary increases, promotions, performance bonus Recognizes and rewards exceptional performance of an employee

Employee Motivation and its measurement

Facilitate communication between employee and

manager. It helps in building relationships Measurement Motivation levels of employees are gauged by managers by having direct communication with them that is feedback from employees is taken to address issues if any. The motivation also is measured by conducting an Employee Perception Survey every year.

Use of Appraisal Data

Pay hike and bonus
Promotion T&D Training Need Identification Career Development

Map to Enterprise Performance

This mapping is ensured at the stage of goal setting-

Individual goals are aligned to Organizational goals. Organizational Goals & Objectives are fixed
These Goals & Objectives get trickled down to all

employees
Manager provides a framework of the G&O Team member drafts the G&O

Map to Enterprise Performance

Manager & team members discuss & moderate the

G&O and finalize

Team member updates this in the system (TED

Web>Goals & Objectives)

Manager approves the G&O for the year

The performance bonus, salary hikes etc are given as a

percentage of companys performance that year.

The Appraisal Form

Wipro form.doc

Goal Setting Process

Goal setting Personal Business Commitment
Set in January Mid year review in June

Goals
Business goals Development goals People management goals

Review done by 2 managers

Project manager
People manager

Goals
Business Goals project related goals, adhering

to IBM policies,
They are common to people in same project

Development Goals personal development

goals like certification, active contribution to technical forum

People Management Goals Mandatory only for

managers.

Performance Review
Self Assessment on PBC tool to record professional

contributions PBC rating based on results achieved, compatibility to IBMs values and relative to peers Results and ratings signed off by employee, manager and up-line manager During the year-end appraisal cycle, the manager participates in a meeting, facilitated by second-line manager, called a team-based decision making session This process helps to reach the consensus of who are the top and bottom performers

Ratings
Rating 1: Top Contributor

Rating 2+: Excellent performer Rating 2: Solid Contributor (Default rating) Rating 3: Average Contributor Rating 4: Poor Performer

PBC Goals on IBM Intranet

Business Goals

Development Goals

Goal Setting
Goal setting is majorly bottom up approach
Appraisal is top-down approach

E-PMS System
E-PMS: is an online performance appraisal

system The individual is assessed on competencies need to perform the job

These are behavioral and technical competencies As the level increases (hierarchical) the weightage

of the behavioral competencies increases It is a five point rating scale The final rating is the weighted average
Annual appraisal cycle is followed from Jan-Dec. Decisions based on the appraisal are

communicated in April

Steps in Performance Appraisal

In the E-PMS system the individual rates self and

the reporting officer also rates him. Then a feedback meeting is arranged between the employee and the reporting officer . In this meeting the individuals development plan is decided for the year This is followed by the normalization process and final ratings are assigned On the basis of the final ratings the decisions of succession planning , promotions and career planning are taken that impact the organization and the individual

 In April these decisions are conveyed to the

employees through written communication.(individual communication) After the normalization process there is another meeting held between the reporting officer and the employee where the ratings are conveyed. There is no readdressal mechanism to address the disappointed employees.

Actions Based on the Normalization Process

In the normalization process the top 20% are

considered for promotion and pay-hikes The bottom 20% are critical of these the extreme bottom 5% are managed out The rest of the 15% are monitored for 3-6 months in which they are also given coaching and mentoring to help them improve their performance. If no noticeable improvement is observed then they are also subsequently managed out.

Performance Feedback Process

The performance appraisal system and feedback

system are different In Performance feedback the individual is assessed on the KRAs every quarter but this is strictly performance based unlike the annual appraisals. These ratings are considered for performance bonus payouts These ratings are also on a five pointer scale There are also informal feedback system based on the supervisors discretion.

Feedback Meeting(Performance Appraisal)

In this meeting the two discuss the development

plan of the individual for the next one year after discussing the performance of the employee and giving him appropriate feedback based on his competencies The KRAs of the manager include to see to it that the employees have successfully completed his development plan actions E.g. Sap certifications and other training that need to be provided since it is an IT organization.

Implementation Issues
Though there is acceptability of the system the

assessment is done on competencies and the managers and the employees are facing a difficulty in understanding the competencies in the same language/terms. There are training programs to spread awareness on these issues but still each individual understands competencies in different terms. Also different supervisors would be rating the same person differently based on their understanding of the competency.

Company Objectives
The quarterly KRA system is to manage the

performance of the employees and monitor the results in accordance with the goals set and subsequent revisions in the goals if any needed The annual feedback is for retaining and enhancing the in-house talent pool of the organization.

Impact on Employees
Since both the employee performance and the

behavioral aspects are taken care of the employees are more satisfied as their personal growth is also taken care of. In case of disagreements there is a greater impact(negative) on the employee morale as there is no readdressal system.

About the company:

Winshuttle, Inc. provides software products that

enable business users to work with SAP directly from Excel, without any programming. It was founded in 2003.
It has an employee strength on 85.

The PMS Process

Filling the appraisal form and self rating

Rating scale of 1 to 7 (1 poor, 7 excellent) Timeline 3 days

One to one rates the employee on the basis of the same form meeting The form is sent to the MD with Developme nt Manager

A discussion on all parameters tales place. The DM then

Final Process

The employees meet with the MD and a discussion takes place regarding feedback, grievances etc After this meeting, the rating is fixed.

Applications
Salary increments
Promotions

Both these are subjective, and are decided based on the DMs inputs by the MD.

Advantages
Very open and transparent process.

Since its a very small company, there are no disagreements on the rating. Everyone is aware of what work is done by whom in the team. Easily establish a link between your results and their contribution to the company.

Implementation Issues
Since its a small company, there are no fixed

processes and policies for performance management. It is done in an informal way. No proper scale is defined for increments. It is based solely on the managers judgment.

The Appraisal Form

Winshuttle form.xlsx

Objectives for PMS

About EA Sports Major American developer, marketer, publisher and distributer of video games.
Overall performance cycle Compensation planning & bonus Career development

Process of PMS
Goal Setting

Goal setting is done yearly. Progress is checked monthly/bi monthly depending upon the manager Goals are cascaded down form the vision and mission of the company to every business unit and employee

Self Appraisal

Self assessment is done on both goals and the competencies relevant for that role Employee has to substantiate their assessment with evidence like reports, mails etc

Managers assessment

Manager reviews assessment done by the employee and gives a final rating

5 Point Scale for Rating

1. Significantly Below Target 2. Below Target 3. On Target 4. Above Target 5. Significantly Above Target

Use of Appraisal Data

Bonus-A part of the revenue is distributed among

each SBU. The SBU Head has to distribute the allocated amount among employees based on their respective performance ratings. Target bonus is set for each employee in beginning of the appraisal cycle. Depending upon the rating the actual bonus can be greater than or less than the target bonus.
Career Development- During the review process the

career aspirations of the employee are discussed and the action plan is set. This helps in career development.
Compensation planning and performance

management go hand in hand. This is used to determine the salary increments for the year

Challenges in Implementation
Inadequacy of managers in effectively rating the

employees
- HR mentors the managers to rate the employee

correctly and provide them with the skills to prepare the compensation package.

Motivation for Employees

Training and development programs for

employees Career Development opportunities Promotions and bonus for employees

The Appraisal Form

EA form.docx

Thank You