Performance Management in Organizations by: Idumange John (1) High performing organizations consistently outperform competitors and realize bottom-line impact from their human functions. Scholars have identified five components or domains of a high performing organization. 1. Strategy: Strategy means how to use organizational resources skills and competencies to create competitive advantage. Strategy exists at three basic levels namely corporate Strategy, Business Unit Strategy and Team Strategy. 2. Corporate Strategy refers to the overall strategy of an organization which determines how the corporation supports the value of business. It addresses the question of how the structure of an organization creates more value for the individual and the organization. Corporate value enables an organization to know the resources to be deployed, to create the greatest possible value skills t be used and a combination of all variables to support the strategy goals of an organization. 3. Business unit strategy is concerned with how to win in the market here competitive analysis including gathering competitive intelligence, core competencies and SWOT Analysis are required. In smaller business, corporate strategy and business unit strategy overlap. For this overlap to be in Synch, it is important to have a clear definition of the business unit’s mission, vision and core values. 4. Team Strategy: Teams are working groups to which specific tasks have been assigned. Each team has its own team-level strategy-which is directly related to the achievement of business and corporate strategies. Each team must have a task, team character, operational dynamics and key performance indicators. 2. Leadership: Leadership must communicate expectation and develop and promote the right people. Leadership must initiate structure and consideration and show the direction to follow. 3. Talent: Talent refers to those innate capabilities with which an individual worker is endowed. Talent is necessary for a failed business. Talent closes the gap between where the business needs to go and what it takes to manage the business during tough times. Sound talent strategy starts with a clear picture of the business outcomes and defining the talents required to achieve the outcomes. Every organization must have a clear-cut policy of choosing the right talents that will align with the corporate strategy with accomplishing rewards, recognition, and compensation to drive results. 5. Organizational Culture: This is the behaviour of humans who are part of an organization and they are attached to the values, vision, beliefs, norms and habits of the organization. Organizational culture affects the way people and groups interact with one another, with clients, and with stakeholders. Ravasi and Schultz (2006) states that organizational culture is a set of shared assumptions that guide, define and interpret corporate behaviour organizational culture through communication and symbols, or competing. In modern times, organizational culture is seen as a network of shared meanings as well as the power struggles involved by creating similar networks of competition. An effective organization must have a mechanism of creating a new culture, changing weak cultures, maintaining new culture and establishing and keeping the new culture. Corporate culture is the sum total of the values, customs and traditions that make a company unique. Corporate culture is the “Character of an Organization” 5. Market: In organizational perspective, every employee should know the relationship between his or her job and its impact on business results. An organization has to apply marketing techniques such as competitive strategy, to analyze how the firm operates; value chain analysis, strategic group of competitors and market research within the context of SWOT analysis. It must also include brand audit, product differentiation and sustainable competitive advantage. Joshi (2005). Some high performance organization use customer data to identify job positions, design unique pay-for-performance. Performance should be centered on strategy, leadership, talent, culture and market to enhance the achievement of premeditated goals. Purpose of Performance Management (PM) Performance is the litmus test for organizational survival. High Performing employees’ contribute superior performance – giving the company a competitive edge. Every organization needs continuous improvement. This includes quality delivery of services. PM is an effort to maximize results of an organization and its units or departments. This is achieved through planning, monitoring organizational teams and enhancing individual effectiveness to optimize performance. PM also seeks to encourage individual and team development. Here, attempt is given to competence development, performance shortfall remediation and employee development – all geared towards positive performance outcomes. PM is all-inclusive as it involves communication among all stakeholders, executives, and workforce in relation to the company, teams and individuals commitments interests and values. It tends to satiate the desires of the various clienteles. PM entails collaboration of all segments of an organization and in the process builds cohesion, mutual understanding and respect among all units and parts of the organization. Against this background, PM leads to the following: Development of employees with robust skills and knowledge-base to support excellent performance Helps employees feel empowered and recognize employees achievements Helps the organization raise individual performance and increase the overall effectiveness. Planning based on insights of trends in the industry and events that impact on our business. Monitoring progress towards time-limited target or objective Report past, current or forecast conditions to stakeholders Providing a comprehensive feedback to all employees about their performance. Providing relevant data for training efforts through training needs analysis Constituting a source of information for reward, and Providing a basis for making other important administrative decisions such as deployment, staff re-assignments, task assignment and discharge. PM is guided by certain principles Corporate goals must be adopted as team and individual goals Objectives must be jointly agreed between supervisor and workers, not set assigned by former. Thrives on clarity and comprehensives of goals It relies on cooperation and consensus It emphasis feedback as a basis for assessment and development Strategies for improving organizational performance So many organizations are not satisfied with their current positions in terms of performance. As a result, some organizations truly to re-invent themselves by deconstructing ineffective organizational structures, redefining leadership and revitalizing business practices around management hierarchies. A huge number of organizations have had to make drastic budget cuts to negatively affect the health of the organization some organizations play the waiting game-the sedon look approach hoping that things will get back to normal rather than hit at the organizations reset button. Making an organization to function effectively is like overhauling an automobile: you change the oil; reset the carburetor, change the tiers, service the engine and re-align the car so it can maintain accelerated speed. Consequently, leaders use instability of the present to build on and create organizations that are capable of self-renewal in the absence of crises. Organization renewal involves changing key rules of the game, reshaping part of the organization, redefining the work people do to maintain citizen satisfaction. A well designed organization enemies that the form or infrastructure of the organization matches its purpose and strategy, meets the challenges posed by business realities and pool collective efforts towards desired results. For employees and organizations to achieve optimal performance, the individual employees, work process and organizational conditions must be in alignment. A breakdown of any one of the levels will prevent optimal performance. The organization not only lays the foundation for high performance work system as well as creates a purpose for the organization. Patrick Ibarra (2010) identifies three prominent factor namely organization process and individuals which are critical to the achievement of organizational goals. An organization must have a clear strategy, good organizational culture and modalities for operational efficiency. SWOT: Is the most renowned tool for audit and analysis of the overall strategic position of the business and its environment. The underpinning rationale for SWOT is to identify the strategies that will create specific models that can align an organization’s resources and capacities to the requirements of the environment in which we operate. SWOT helps us in predicting and forecasting trends for purposes of decision making in an organization. STRENGTHS: These are qualities that enable the organization to achieve its goals. Strengths can be tangible or intangible. Tangible strengths are the brainpower, human competencies, financial resources, products and services. Intangible strengths include customer’s goodwill, brand loyalty, staff commitment and psychological disposition of the personnel. WEAKNESSES: These are qualities that can prevent us from accomplishing our mission. Weakness deteriorates the success and growth potentials of an organization. They may be depreciating machinery, inadequate research and development facilities, narrow product range, poor-decision making. Others include huge debt profile, high employment turnover, complex decision making process, narrow range of products, and wastage of raw materials. OPPORTUNITIES: These are variables that can be advantageous to the organization. They are the add-ups to the competitive advantage of an organization. Opportunities may arise from market, competition, industry/government, technology and communication. The policy of deregulation is also a great opportunity to frims involved in service-based organizations. THREATS: There are conditions in the external environment that can jeopardize the reliability, profitability and integrity of an organization. Threats are controllable but when they come, the stability and survival of an organization is threatened. For example: industrial disharmony, change in technology, increasing competition, price wars, corruption within an organization. SWOT helps an organization to build organizations strengths, policy formulation, maximize its response to opportunities and help in strategic planning. SWOT helps an organization overcome threats, identify core competencies, set strategic planning and provide data to track progress. To be contd.
Posted on: Thu, 09 Oct 2014 07:47:11 +0000
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