Performance Management Process of GlaxoSmithKline Bangladesh Limited

Executive Summary

Performance management system is management processes for ensuring employees are

focusing their work efforts in ways that contribute to achieving the agency’s mission. It

consists of setting expectations for employee performance, maintaining a dialogue

between supervisor and employee to keep performance on track, and measuring actual

performance relative to performance expectations. An organization’s success requires

when both supervisor and subordinates regularly evaluate their on-the-job performance.

So I think for an organization it is very important to have an effective performance

management system.

There is greater recognition that distinctive competencies are obtained through highly

developed employee skills, distinctive organizational cultures, management processes and

systems. To attain such recognitions HR plays a key role and one of the important aspects

of HR process affiliated with the above objective is performance management process. In

this study an attempt has been made to understand the performance management process

of pharmaceutical companies in Bangladesh and GlaxoSmithKline (GSK) Bangladesh

Ltd.; a subsidiary of GlaxoSmithKline plc. has been taken as a case study in this regard.

This report mainly covered five broad areas of performance management process those are

measuring performance, reviewing performance, rating performance, reward management

and feedback system. GlaxoSmithKline Bangladesh divided their total employees into

four divisions those are directors and managers, officers, sales force officers, non

management staff’s. All of those four divisions are under the same roof but their

performance measurement, reviewing, rating, reward and feedback systems are different.

The repercussion of this study reveals the performance management process and

eventually concludes with some implications for pharmaceutical companies of Bangladesh

to make the present performance management process more effective and objective

oriented.

2

Table of Contents

Topic Page Numbers

Introduction 7

Company Profile 8-9

Objective of the Study 10

Scope of the study 11

Limitation of the Study 11

Methods of data collection 11

Performance Management Processes of GSK Bangladesh Limited

12

Measuring Performance 13-15

Performance Review 16-17

Rating Performance 18

Reward Management 19-20

Feedback System 21-22

Recommendation 23

Conclusion 24

2

Introduction:

GlaxoSmithKline (GSK) is a world leading research-based pharmaceutical company with

a powerful combination of skills and resources that provides a platform for delivering

strong growth in today’s rapidly changing healthcare business environment.

In today’s intensely competitive and global marketplace, competitive advantage lies not

just in differentiating a product or service or in becoming the low cost leader but in also

being able to tap the company’s special skills or core competencies. Thereby skilled and

efficient employees of a company are now considered as one of the core competencies of

the company. Especially for pharmaceutical industry skilled and efficient employees are

must as it requires specialized, technical and, scientific knowledge and expertise and there

is zero tolerance in terms of developing quality products & services.

Performance Management process is a broader issue. Performance Management is a

strategic and integrated process that delivers sustained success to organizations by

improving the performance of the people who work in them and by developing the

capabilities of individual contributors and teams.

To attain such objectives HR plays a vital role and one of the most used tools by HR in

order to ensure skilled and efficient employees is performance appraisal. This is a part of

performance management.

Company Profile

2

G1axoSmithKline (GSK) International is a world leading research-based pharmaceutical

company with a powerful combination of skills and resources that provides a platform for

delivering strong growth in today's rapidly changing healthcare environment. GSK

International is now positioning as 2nd in terms of generating sales volume and 4th in

terms of generating revenue comparing to other multinational pharmaceutical player.

The company started its business in Bangladesh in 1947 at Chittagong by importing from

group companies. The Chittagong factory site of GSK Bangladesh Limited was

established in 1967. Name of company changed from "Glaxo Welcome Bangladesh

Limited" to "GlaxoSmithKline Bangladesh Limited" on 4th September 2002. The

company is located with its Headquarter in Dhaka and registered office in Chittagong.

GSK Bangladesh’s 81.95% market share is owned by GSK International, and rests are

owned by the ICB, general public and others of Bangladesh. This is a listed company

under Dhaka and Chittagong Stock Exchange. At present, in Bangladesh, there are 204

national pharmaceutical companies and only 7 multinational or foreign companies

operating. In Bangladesh although they are dominating on vaccination along with some

other group of medicine and health food drinks but in terms market share positioning they

were stood at 8th .The current portfolio of GlaxoSmithKline Bangladesh Ltd. covers

almost all drugs like Anti-bacterial, Respiratory, Vitamins, Gastro- intestinal, Oral steroid,

Eye/Ear drops, Anti-depressive, Cough and Cold preps, Anti-viral, Non- Pharma. Apart

from the above the most well known health food drinks brand is Horlicks from GSK

Bangladesh Ltd. With the ever committed 615 numbers of personnel all over the country

GSK Bangladesh Ltd., which now comprises of both pharmacy and consumer, continually

strive to meet the GlaxoSmithKline mission to improve the quality of human life by

ensuring healthcare products, health drinks and different corporate social responsibility

programs.

Company Mission and Strategy:

2

Mission: Their global quest is to improve the quality of human life by enabling people to do more, feel better and live longer.

Company Strategy:

Since 2008, they have focused their business around the delivery of three strategic priorities, which aim to increase growth, reduce risk and improve their long term financial performance.

Strategies are:

Grow a diversified global business. (They give important to generate more growth with less risk)

Deliver more products of value. (To be successful in the healthcare marketplace in the next few years it’s all going to be about delivering value)

Simplify the operation model.(By simplifying our operating model I want to make it easier for our employees to make decisions)

Their Strategic Plan:

Focus on the best science. Diversify through externalization. Re-personalize R&D sector. Focus on return on investment. Drive growth in the pharmaceuticals business in their core markets. Fulfill the potential of emerging markets. Expand their business in Asian region. Build their leadership in dermatology. Grow the Vaccines and consumer healthcare business. Evolve their commercial model. Re-shape manufacturing. Streamline their processes. Reduce working capital.

Objective of the Study:

2

This report is prepared for the performance management course, and simultaneously to

explore the knowledge gathered throughout the program on to one specific sector and to

see how theory relates to practice. Therefore, the objectives of this report can be

subdivided into the following two categories:

Broad Objective

To discover the factual settings of how performance management system is conducted

within the organization and this affects the work activities and long term success of the

business and their practices for the organization.

Specific objectives

To understand the theoretical perspective of performance management system of an

organization.

To study the present performance management process of GlaxoSmithKline

Bangladesh Ltd. in order to retrieve the information regarding the performance

measurement, review performance, rating performance, reward management,

feedback system.

To know the international best practices on the Performance Management System.

To determine the policy and techniques GSK Bangladesh is practicing to evaluate

its human resources.

To examine the employee’s attitude towards the effectiveness of the performance

management system practiced by the pharmaceutical company.

To analyze the findings and thereby draw some implications in order.

To find out the success of this system in the field of pharmaceutical company.

To provide recommendation to improve the Performance Management System of

GSK Bangladesh.

Scope of the study:

2

It is obviously a great chance to work with this topic as it focuses practically on

performance management system of GSK Bangladesh Limited. I can collect information

from inside the organization as the environment of GSK Bangladesh is very friendly and

employees are very cooperative to each other.

Limitation of the Study

Time will be a major constraint in accumulating all sorts of information in an organized

way. There could be lack of information on the websites and from the organization. The

findings of the survey are based on the employee/manager response of the company so;

there can be some confidential data that may not be revealed because of GSK Bangladesh

limited’s secrecy.

Methods of data collection:

Primary Data:

Primary data has been collected through personal interview with the managers and employee of GSK Bangladesh Ltd. In order to discuss about the related matters before preparing the report.

Secondary Data:

We collected secondary data from:

Articles and researches available in the internet and other sources.

Information collected from previous prepared report on GSK Bangladesh Ltd.

Data also collected from GSK Bangladesh Ltd and GSK International website.

2

Performance Management Processes of GSK Bangladesh Limited:

GSK Bangladesh Ltd. has four functional sub-department of HR department. The

departments are HR Development, HR Services, Compensation and Industrial Relations.

GSK has divided its total employees into two categories for appraisal: (1) management

employees and (2) non-management employees. For management employees, it has been

splied into director, manager and officer. There are two categories of officer. One is office

based officer and another is field force officer. Office based officers are also of two types,

one is commercial officer and another is global manufacturing & supply (GMS)/ factory

officer. Covering the above categories in total six types of appraisal system is used under

performance management process in GSK Bangladesh Ltd. such as: (1) director, (2)

manager, (3) commercial officer, (4) global manufacturing & supply (GMS)/ factory

officer, (5) field force officer, and (6) non-management staff. All this appraisal process

has been conducted once in a year with a midyear review option.

Performance Management of GSK Bangladesh ltd. Maintain the standard of their parent

company GSK international. In the performance management process they mainly

emphasis on certain areas. Those areas are given bellow:

Measuring performance.

Review Performance.

Rating performance.

Feedback System.

Reward Management

2

Measuring Performance

For different level of employees performance measurement of GSK Bangladesh Ltd is

different. For measuring performance all of their employees have been divided into four

segments. Each segments measurement technique is different than other segments. But in

all cases Objective for employee is there. They have a specific target to hit. Whoever can

hit the target will be the good performer. They also consider qualitative measures to

measuring their employee performance.

Directors and Managers: To Measure directors’ and managers’ performance, GSK

Bangladesh Ltd. used a standard agreement form that is known as ‘Performance and

Development Plan’ (PDP) followed & practiced by all GSK International affiliates. In the

contract their objectives are written and through discussion it has been explained to the

management employee that what they need to achieve. Overall they followed the overall

process of Management by Objectives (MBO) method.

Performance and Development Planning (PDP) is an important step in the global effort to

engage and enable employees to deliver their contribution to GSK's business success.

Equally as important, PDP serves to enable employees to identify and realize personal

opportunities for development that are aligned to current and future business challenges.

PDP Form consists of seven sections. All of those sections are not involved for measuring

performance; few of them are involved for measuring performance. ‘Performance Plan

& Objectives’ clearly defines expected results and also conforms to as many of the

following criteria as possible which are Specific, Measurable, Action- Oriented, Realistic

and, Time-Based. These criteria are there to ensure what the employee wants to do, by

when and at what level of quality. Also it determines what to do in order to exceed his or

her manager's expectations. Here they have the flexibility to choose any number of

objectives, but not less than 3. ‘Leadership Essentials’ is there to find how work gets

2

done to achieve GSK goals and culture. Here employees’ agree up to 3 Leadership

Essentials which will directly impact achievement of their objectives.

Officers: Officer’s measuring performance is a formal process being conducted through

participatory manner. This is not viewed as an annual event rather it represents a

systematic year- round process. At the initial stage of the performance year, both

supervisor and supervisee discuss about targets to be achieved in the current year and

share mutual expectations. At this stage, objectives are set and action plans are developed.

There are two types of formats used for officer’s performance assessment (1) one is for

office-based officers and, (2) field force officer. HR checks and processes all documents

and communicates with the concerned employees in writing about the performance

outcome. For any discrepancy it has been discussed with the concerned line manager and

solved immediately. Office based officers are of two types – (1) commercial officer and,

(2) global manufacturing & supply (GMS)/ factory officer. The performance measurement

system of these two categories employees is almost same. The traits that have been

focused in both cases are knowledge/experience relating to job, self-expression speech,

self-expression writing, and application of intelligence, use of initiative, reliability, and

relationship with superior, co-operation with colleagues, leadership qualities, and success

in delegation. After assessing the mentioned adjectives, performance is measured. The

only difference in this case is that in case of Global Manufacturing & Supply (GMS)/

Factory Officer final approval must come from Technical Director.

Sales force Officers: In case of measuring the performance of sales force officer

following adjectives are considered: target achievement (give percentage if available),

product knowledge, market knowledge, customer relations (doctors, chemists etc.), selling

skills (detailing, listening & closing), knowledge of competition, achievement of work

assigned (doctors/chemist calls), ability to organize work, initiative, quality of reporting,

maintenance of MSL & call planners, attitude towards superiors & colleagues, active

2

participation in conference & meeting, effective utilization of promotional materials,

trustworthiness and integrity and, attention to safe working.

Non Management Staff’s: Performance management system of non-management staff is

different than that of management employees. Non-management staff (i.e. sweeper) to

confidential secretary is under non-management sector. In case of non-management

employees’ mainly two issues are considered. (1) Individual record: based on individual

record following items are considered - discipline, punctuality, leave record, monthly

medical visits, leave availed and, (2) Performance: in case of evaluating performance

following things are considered -knowledge of job, accuracy, neatness, dependability,

work speed, responsibility, adaptability, attitude to others, health & safety awareness,

leadership.

2

Performance Review

The following guidelines have been used by GSK Bangladesh for using and storing the

data of PDP:

It allows the employee to monitor and track their progress against their yearly

objectives and development plan.

The annual review portion of the form will feed into GSK's compensation process

as a variable for both bonus and salary increases.

The information form may be used in the talent review process to provide feedback

to the employee on their career development and to allow GSK Management to

forecast the future talent needs of the corporation.

‘Periodic Reviews’ set up reviews of employee objectives and essentials with their

manager several times throughout the year. This enables them to know how they are

progressing in both areas and allow time to adjust if necessary. Supervisors observe the

pattern of behavior of the subordinate in connection with job performance. This is process

of observation, follow-up, providing necessary support, counseling, coaching and

mentoring etc.

‘Annual Review’ takes place at the end of the year. Here the manager first evaluates each

objective and essential. It is important to note here that the manager's overall review of an

employee's, performance will be an important, but not the only, element in making

compensation decisions. In this review specific objectives are considered as their key

achievement.

2

‘Development Plan Periodic Reviews’ is there to review their progress on their

development plan several times a year with their objectives and Leadership Essentials.

Development enlarge their responsibilities which lead them to achieve their objectives

more easily.

‘Development Annual Review’ is to take place at the end of the year and may take place

at the same time as the review of their objectives and Leadership Essentials or at a

separate time if an employee and their manager prefer. Here too, it is important to get

customer input to help them assess how they are progressing on their development.

‘Talent Review’ is another form of review the performance of top-level i.e. executive

employee. The purpose of Talent Review is to focus on the development of leaders to

meet future business challenges and to make key talent more visible across GSK. The

process also ensures that organizational changes are anticipated and successors identified.

Both PDP & Talent Review are designed to help retain key talent. In world class

organizations, top performers are motivated by challenging work that is aligned with

corporate objectives, opportunities to learn and develop, and compensation packages that

reflect their performance.

GSK Bangladesh Ltd management maintains ‘Annual Confidential Report’ or ACR to

assess annual job performance of each and every Officer, Sales Force officer and non-

management staff. Job performance of officers, sales force officers and non-management

staffs is evaluated once at the end of each financial year. In ACR, every departmental

heads put their remarks about the individual's job performance and efficiency. This is

necessary to keep the record and prove of their activities.

2

Rating Performance

For rating the performance of their managers and officers they use six point scale -

Outstanding, Good, Average, Poor, Unsatisfactory and +/- Last. Those scales used to rate

their performance. Based on their given objectives this rating has been done. If an

employee fulfills and achieve given objective then rating comes out outstanding. Rating

for performance of GSK Bangladesh is very much transparent. They follow the

international standard. Also in this case they are aligned with their parent company.

For rating sales force officers adjective rating scale method is used as well. Here

evaluation is done on each of the items on a point scale – Outstanding (A) Very good (B)

Good (Performance superior to expected standard) (C) Satisfactory (Expected standard of

performance) (D) Marginal (Not entirely satisfactory) (E) Unsatisfactory (Requires action,

assistance & training) (F)Poor

For non management staff evaluation is done on each of the items on a five point scale –

(A) Very Good, (B) Good, (C) Satisfactory,(D) Poor, and (E) Very Poor.

2

Reward Management

It is important to note here that the manager's overall review of an employee's,

performance will be an important, but not the only, element in making compensation

decisions. ‘Development Plan’ is to develop knowledge, skills and behaviors that will

enable an employee to be successful in their current position, as well as prepare them for

future roles to which they aspire. In this part they look at how they can leverage their

strengths to achieve their current goals and plan how to address development needs.

The success of their business depends on getting the best from our people. They do this by

creating a positive working environment, offering competitive reward packages that

emphasize performance, providing opportunities for training and advancement, and by

listening and responding to employees’ feedback.

There are two kinds of reward management followed by GSK Bangladesh. One is

financial reward and another one is non-financial rewards.

Financial reward:

Target based incentives- They offer competitive salaries that are based on industry

benchmarks and achievement of their targets.

Performance based incentives- They compensate employees by rising their salary

as well as incentives that acknowledge employees’ good performance against

annual objectives and actual company performance.

Responsibility based incentives- Based of the responsibilities that can performed in

the given time period are compensated with smart salary upgrade.

2

Non-financial reward:

Rewarding employees for their contribution to the company and recognizing their

achievements help them attract, retain and motivate the best people.

Share ownership schemes, open to GSK managers worldwide and all employees in

some markets.

Pension provision, retirement plans, health life insurance, life insurance, disability

insurance.

Healthcare, vacation, childcare support and employee car ownership programmers.

Recognition for specific projects and for demonstrating high performance above

and beyond the day job.

Healthcare Plan, Health MOT, Holidays, Employee Assistance Programme, Tax-

free: Plans, Discounts

Promotion and praise.

Their share ownership schemes help to create a culture of ownership among their

employees. GSK managers worldwide are eligible to participate in share programmers as

part of their reward package. In countries where all employees have the opportunity to

own shares, there is a high level of participation.

2

Feedback System

Feed back to the individual and relevant decision-makers. In a performance management

system, feedback plays an important role both for motivational and informational purposes

and for improved communications between management and employees. GKS

Bangladesh strongly consider that supportive feedback can lead to greater work

motivation for employees and feedback discussions about pay and advancement can lead

to greater employee satisfaction with performance management processes. In effect,

providing people with feedback about their performance will have positive effects on their

future performance.

Feedback system of GSK Bangladesh Limited follows smart techniques. Those are given

bellow.

GKS global intranet site provides news and updates and a Q&A section where

employees can put questions directly to the CEO and other senior executives. Up to

100 questions are answered each month.

During the year, supervisor provides performance feedback to the employee.

Directors and above have to pass under 360 degree feedback systems.360 Degree

Feedback is a system or process in which employees receive confidential,

anonymous feedback from the people who work around them. This typically

includes the employee's manager, peers, and direct reports. A mixture of about

eight to twelve people fill out an anonymous online feedback form that asks

questions covering a broad range of workplace competencies. The feedback forms

include questions that are measured on a rating scale and also ask raters to provide

written comments. The person receiving feedback also fills out a self-rating survey

that includes the same survey questions that others receive in their forms.

2

Managers and leaders of GSK Bangladesh use 360 feedback surveys to get a better

understanding of their strengths and weaknesses. The 360 feedback system

automatically tabulates the results and presents those in a format that helps the

feedback recipient create a development plan.

Townhall sessions for employees at all levels of the company, hosted by senior

management including the CEO. Employees have the opportunity to discuss the

progress of the business, raise questions and give feedback.

Employee surveys are carried out regularly throughout the organization to enable

staff to give feedback. A global survey of managers is carried out every two years.

Confidential feedback mechanisms enable employees to raise concerns. These

include our integrity helpline.

They also keep employees informed about their corporate responsibility programmes. All

senior employees will receive a copy of their CR Overview. The Overview will also be

included in Spirit, our internal magazine, which reaches around 50,000 employees. They

track the effectiveness of communications through questionnaires and employee surveys.

Through survey they found that:

• 61% of respondents believe their communications are open, honest and objective

• 75% feel they have access to the information they need to be an ambassador for GSK.

2

Recommendation:

Recommendation of this report has been made on the basis of the analysis and proposed

changes on the current performance management process and management philosophy. It

is very difficult to recommend about this issue because this issue is very sensitive, directly

related to the management of the organization. Despite of these matters there is something

that I want to recommend to GSK Bangladesh that they should look at-

As a multinational pharmaceutical company GSK Bangladesh Ltd. should develop

the ‘Internet Based Performance Management’. Where employees can find out

there present performance status by login in and from that place they will find out

their agreed objectives and overall suggestions from the company higher

management. This can speed up the performance management process.

It should also include some factors like- commercial judgment, creativity, problem

solving decision making, steadiness under pressure, personal appearance and

image.

They can introduce two way judgmental approaches. Where beside superior

subordinates can give their suggestion and evaluation for their superiors. This will

create impact on the rating of the superior performance.

2

Conclusion

Performance management process of GSK Bangladesh Ltd. could be a role model for

many other organizations in this country especially the international standardized PDP

form and other process mentioned in this report.

The goal of GSK International is to be indisputable leader in the field of world

pharmaceutical companies. To achieve this goal, GSK has to develop a global set up for

each operating country office with local competencies. Keeping this target in mind GSK

Bangladesh Ltd. realizes the indispensable need of identification of potential employees

and placing the right people to the right position. They recognize that only those people

can achieve their goal whose potentiality is well identified by the company. The

performance management process is thus playing an important role for this company. In a

conclusion note this is just to mention that the organization conducts an ‘Employee

Satisfaction Survey’ every year to understand their perception and expectation. The

organization seemed pleased about the fact that the perception was enthusiastic and

generally positive.

2

Bibliography

Armstrong, M. Baron. A, Managing Performance, Performance Management in Action, P23-40

Zaman, L. Case Study on GlaxoSmithKline Bangladesh Limited; Vol. 1, No, 1; September 11

Dessler, G.(1999). Human Resource Management (7th Edition), N.J: Prentice Hall Inc., P345-367

Employee Guide to Business Conduct; Ninth Edition. P32-35

GSK Corporate Responsibility Report; 2004; 12-16

Vanguard University; Performance Management Process; P2-10

En.wikipedia.org

www.gsk.com.bd

www.gsk.com

2