Manage people performance (BSBMGT502)

Manage people performanceBSBMGT502

Student Workbook

1st Edition

Student Workbook BSBMGT502 Manage people performance

1st Edition 2015

Part of a suite of support materials for the

BSB Business Services Training Package

Acknowledgement

Innovation and Business Industry Skills Council (IBSA) would like to acknowledge HASCOM Pty Ltd for their assistance with the development of this resource.

1st edition writers: Andrea Wallace/Greg Darcy

2nd edition revised by IBSA Instructional Designer: David Grubisich

Revised for BSBMGT502 by IBSA (2015)

Copyright and Trade Mark Statement

© 2015 Innovation and Business Industry Skills Council Ltd

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Published by: Innovation and Business Industry Skills Council Ltd Level 11 176 Wellington Pde East Melbourne VIC 3002 Phone: +61 3 9815 7000 Fax: +61 3 9815 7001 Email: [email protected] www.ibsa.org.au

First published: April 2015

1st edition version: 1

Release date: April 2015

ISBN: 978-1-925123-68-5

Stock code: BSBMGT5021D

mailto:[email protected]

mailto:[email protected]

http://www.ibsa.org.au/

Table of Contents

Introduction ...........................................................................................................................1

Features of the training program ...................................................................................1

Structure of the training program ...................................................................................1

Recommended reading ...................................................................................................1

Section 1 – Allocate work ....................................................................................................3

What skills will you need? ...............................................................................................3

Performance management .............................................................................................4

Consult on work allocation and resourcing ................................................................ 10

Develop performance standards and work plans with employees .......................... 13

Develop performance indicators ................................................................................. 17

Manage performance management risk .................................................................... 25

Section summary .......................................................................................................... 29

Further reading ............................................................................................................. 29

Section checklist .......................................................................................................... 30

Section 2 – Design Performance Management Systems and Assess Performance .... 31

What skills will you need? ............................................................................................ 32

Design performance management processes ........................................................... 33

Train participants in performance management........................................................ 37

Implement performance management: monitoring performance ............................ 43

Section summary .......................................................................................................... 47

Further reading ............................................................................................................. 47


Section 3 – Provide Feedback .......................................................................................... 48


Provide ongoing feedback ........................................................................................... 49

Coach performance ...................................................................................................... 54

Conduct formal, structured feedback sessions .......................................................... 59

Section summary .......................................................................................................... 62

Further reading ............................................................................................................. 62


Section 4 – Manage Follow Up ......................................................................................... 64


Plan performance improvement and development ................................................... 65

Seek assistance ........................................................................................................... 67

Reinforce excellence .................................................................................................... 69

Manage poor performance .......................................................................................... 73

Counsel and discipline individuals .............................................................................. 85

Dismiss staff in accordance with legal requirements ................................................ 90

Section summary .......................................................................................................... 93

Further reading ............................................................................................................. 93


Glossary .............................................................................................................................. 95

Appendices ......................................................................................................................... 97

Appendix 1: Integrated performance management system ...................................... 97

Appendix 2: Example of a position description template ......................................... 98

Appendix 3: Example of a risk management plan/risk register .............................. 102

Appendix 4: Conducting an appraisal (sample procedure and template) .............. 103

Appendix 5: Skills audit/training needs analysis ..................................................... 116

Appendix 6: Example of a competency rubric for a customer service position ...... 118

Appendix 7: Example of probationary period assessment form .............................. 120

Appendix 8: Example of probationary period checklist ........................................... 130

Appendix 9: Performance appraisal planning checklist .......................................... 131

Appendix 10: Personal development plan template ................................................ 132

Appendix 11: Counselling template .......................................................................... 136

Appendix 12: Written warning template example .................................................... 137

Student Workbook Introduction

Introduction

Features of the training program

The key features of this program are:

● Student Workbook – Self-paced learning activities to help you to develop an understanding of key concepts and terms. The Student Workbook is broken down into several sections.

● Facilitator-led sessions – Challenging and interesting learning activities that can be completed in the classroom or by distance learning that will help you consolidate and apply what you have learned in the Student Workbook.

● Assessment tasks – Summative assessments where you can apply your new skills and knowledge to solve authentic workplace tasks and problems.

Structure of the training program

This training program introduces you to manage people performance. Specifically, you will develop the skills and knowledge in the following topic areas:

1. Allocate work

2. Design performance management systems and assess performance

3. Provide feedback

4. Manage follow up.

Your facilitator may choose to combine or split sessions. For example, in some cases, this training program may be delivered in two or three sessions, or in others, as many as eight sessions.

Recommended reading

Some recommended reading for this unit includes:

● Aguinis, H., 2012, Performance management, 3rd edn, Pearson Education Limited, Upper Saddle River, New Jersey.

● Armstrong, M., 2006, Performance management: key strategies and practical guidelines, 3rd edn, Kogan Page, London.

● Nankervis, A., Compton, R., and Baird, M., 2002, Strategic human resource management, 4th edn, Thomson Learning, Melbourne.

● Tovey, M., Uren, M.-A. L. and Sheldon, N. E., 2010, Managing performance improvement, 3rd edn, Pearson, Frenchs Forest, NSW.

BSBMGT502 Manage people performance 1st edition version: 1 © 2015 Innovation and Business Industry Skills Council Ltd Page 1 of 137

Introduction Student Workbook

● Fair Work Ombudsman, 2013, Best practice guide: managing underperformance, available online, Fair Work Ombudsman, viewed December 2014, <http://www.fairwork.gov.au/BestPracticeGuides/09-Managing-underperformance.pdf>.

● PeopleStreme, 2014, ‘What is employee performance management?’, PeopleStreme, viewed December 2014, <http://www.peoplestreme.com/what-is-performance-management.shtml>.

● PriceWaterhouseCoopers, 2008, Managing business performance: the metrics that matter, available online, PriceWaterhouseCoopers, viewed December 2014, <http://www.pwc.com.au/consulting/assets/publications/Managing-Business-Performance-Metrics-2008.pdf>.

Please note that any URLs contained in the recommended reading, learning content and learning activities of this publication were checked for currency during the production process. Note, however, IBSA cannot vouch for the ongoing currency of URLs.

Every endeavour has been made to provide a full reference for all web links. Where URLs are not current we recommend using the reference information provided to search for the source in your chosen search engine.

1st edition version: 1 BSBMGT502 Manage people performance Page 2 of 137 © 2015 Innovation and Business Industry Skills Council Ltd

Student Workbook Section 1 – Allocate work

Section 1 – Allocate work The focus of this section is on allocating work in the context of performance managing people. Section 1 outlines the process of setting work plans and allocating work in consultation with others and in accordance with organisational plans, setting performance standards and measures, and managing risk associated with performance management.

Scenario: Allocating work

Australian Hardware (a simulated business) is a large and expanding hardware and homewares retailer with approximately 140 stores located across Australia. In its vision statement, Australian Hardware outlines that it intends to lead the hardware and home improvement market in Australia within five years. In order to realise this vision, the organisation will take the following strategic approaches outlined in its business plan:

● increase sales revenue and gross profit

● maintain or increase market share

● control direct and indirect operational costs

● maintain superior product and service quality standards

● establish reputation of Australian Hardware as a socially and environmentally responsible company.

At Australian Hardware, performance management is implemented from the top levels of management down to the store and team levels. The implementation of performance management is designed to be integrated with other related management functions such as financial control, recruitment, succession planning, risk management, work health and safety, training, etc. to take a unified and holistic approach to the development of individuals and of a high-performing organisation.

Australian Hardware simulated business information, including business and operational plans, financial information, and policies and procedures (including performance management) can be located online at <http://simulations.ibsa.org.au/>.

What skills will you need?

In order to allocate work in the context of performance management and in accordance with operational and strategic planning, you must be able to:

analyse business strategy and operational plans to determine human resources requirements

review the external business environment and its likely impact on the organisation’s human resources requirements

consult line and senior managers to identify human resources needs in their areas


Section 1 – Allocate work Student Workbook

review the organisation’s requirements for diversity in the workforce

develop options for the delivery of human resources services that comply with legislative requirements, organisational policies and business goals

develop and agree on strategies and action plans for the delivery of human resources services

agree on and document roles and responsibilities of the human resources team, line managers, and external contractors.

Performance management

At the most basic level, performance at work can be described as the behaviour of delivering outputs on time, within budget and according to specification. Tovey and Uren suggest performance ‘relates to the carrying out of a work task, duty, or objective. It is implied that it will be done to a satisfactory level’.1 So what does it mean to manage performance? Armstrong defines performance management as:

a systematic process for improving organisational performance by developing the performance of individuals and teams ... a means of getting better results from the organisation, teams and individuals by understanding and managing performance within an agreed framework of planned goals, standards and competence requirements.2

Performance management is a human resources system, often overseen and administered by a dedicated HR function, which is designed to allow the organisation to meet goals that are set at the individual, team and organisational levels. Goals may derive from a number of important perspectives, including customer satisfaction, efficiency, learning and development and financial goals.

In fact, elements of performance management (such as setting targets, developing skills, monitoring performance and taking actions to improve performance) have a direct impact on profitability. A study conducted by Price Waterhouse Coopers3 in late 2008 of over 400 senior managers in Canada revealed that organisations with high financial performance were 26% more effective in planning, analysing, measuring and managing performance when compared with organisations of low financial performance.

1 M. Tovey and M.-A. Uren, 2006, Managing performance improvement, Pearson Australia, p. 84. 2 M. Armstrong, 2006, Performance management: key strategies and practical guidelines, 3rd edn, Kogan Page, p. 1. 3 PricewaterhouseCoopers, 2009, Performance management matters: Sustaining superior results in a global economy, PWC Canada, available online, viewed February 2015, <http://pickmybrain.org/wp-content/ uploads/2010/01/Performance-Management-Matters-Report-0609-en.pdf>.



Case study: Managing people for profit4

A 10-year study published by Kravetz in 1996 correlated people management practices with profit performance measures. This study covered over 200 organisations (150 of which were Fortune 500 companies), measured five key indicators of profitability and correlated them with companies with high people management practice scores compared to those with low people management practice scores.

Indicator of profitability Companies with high people management practices scores

Companies with low people management practices

Sales growth 16.1% 7.4%

Profit growth 18.2% 4.4%

Profit margin 6.4% 3.3%

Growth in earnings per share 16.7% 4.7%

Growth in total returns 19% 8.8%

The practices that predicted company financial success fell into the categories of management style, company culture and goals, organisation structure, communications practices, quality and customer satisfaction, recognition and reward practices, employee development practices, section/promotion practices and job design.

Overall, performance management is essential to the sustainable development of capacity within organisations. It has measureable impact on the job satisfaction and commitment of employees and the financial performance of organisations.

Let’s take a closer look at some of the main performance management concepts, namely, the performance management cycle, including the individual employee’s perspective, system components, coordinating performance management processes, and analysing business and strategic planning.

The performance management cycle On an individual level, the performance management cycle focuses on the time the employee is with the organisation and is developed by the organisation to achieve their potential and assist the organisation is meeting its goals. The three stages of the cycle are illustrated on the right.

Let’s look at these three stages in more detail.

4 K. Dwyer, ‘Managing people for profit’, Change factory, viewed February 2015, <http://www.changefactory.com.au/our-thinking/articles/managing-people-for-profit/>. Adapted with permission.

Manage

Review

Plan



Plan ● Review job descriptions, previous performance reports and any relevant awards or

codes of conduct.

● Create individual goals and objectives in consultation with the employee.

● Ensure a shared understanding exists of the level of performance expected, and how this will be monitored and measured.

● Ensure goals are measurable and aligned to the organisation’s strategic and operational plans.

Manage ● Continually monitor performance and measure results.

● Develop the employee’s performance through ongoing support, training, coaching and feedback.

● Provide regular feedback to discuss progress towards achieving goals and provide an opportunity to modify or change goals.

Review ● Conduct formal performance appraisals.

● Review performance results against set objectives.

● Acknowledge and reward excellent performance.

● Instigate measures to address poor performance.

● Identify areas of improvement and possibilities for further training.

It is important to view planning, managing and reviewing performance as not only separate stages in a repeating cycle but also as overlapping, integrated and simultaneous aspects of performance management. For example, as part of managing people, you should constantly review performance, adjusting your planning as required.

System components A performance management system is made up of many interrelated components. These include:

● documentation and policy frameworks, for example, performance management policies and procedures

● planning and goal-setting in accordance with strategic and operational planning and in consultation with affected stakeholders

● regular monitoring of performance

● ongoing informal feedback

● formal feedback in the form of regular performance appraisal, counselling and disciplinary processes, if necessary

● professional development planning

● support processes

● rewards and recognition for performance.



These performance system components will be discussed at length in this unit.

Integrate performance management processes You will need to integrate performance management systems and processes in order for them to be effective in building performance capability. Effective performance management processes ensure that activities at every level of the organisation are coordinated and align with organisational goals.

It is useful to think of performance management as being integrated both vertically – linking organisational, departmental, team and individual objectives and capabilities – and horizontally – linking aspects of HR processes and performance management of people.5

Importantly, while most organisational goal setting is top-down, goals at each level are best negotiated and agreed upon to ensure employee cooperation; hence vertical integration is two-way (see diagram below).

See Appendix 1 for an example of a fully integrated performance management system.

Let’s look more closely at how performance management can be integrated with strategic and operational planning.

5 M. Armstrong, 2006, Performance management: key strategies and practical guidelines, 3rd edn, Kogan Page.

Planning Managing Rewarding

Vision, mission, strategy

Operational plans, team/individual work plans

Reviewing



Analyse strategic and operational plans In order to develop integrated performance management systems and processes, you will need to analyse business plans, strategic plans and operational plans to understand the organisation. You will need to understand the vision and mission of the organisation, its goals and strategic objectives, its company structure and its operations at all levels in order to coordinate HR and performance management activities and processes that are practical and effective for the organisation.

Naturally, different organisations will require different goals, strategies and performance management processes. For example, the strategy of a low-cost airline would, in part, include having a higher proportion of variable costs compared to fixed costs.

The performance management system must support the overall strategy of the organisation. In our low-cost airline example, it must reinforce the efforts to keep costs low. This would potentially affect the reward and recognition scheme and the types of key performance indicators (KPIs) used to manage performance and remuneration.

Operational plans Operational plans define the day-to-day functioning of the organisation to achieve the strategic goals set by the organisation. The type of business typically defines the types of operational plans developed; however, generally operational plans include:

● Production and manufacturing – How do you produce the product/service that you provide to your customer? Whether it is a product or a service that you are providing, production and manufacturing focuses on how you meet the needs of your customer.

● Human resources – Ensuring you have the right number of employees with the right skills at the right time to produce the products or provide the services to your customers.

● Processes – Having processes in place to produce your product and provide your service. These processes determine requirements with regards to technology, quality, human resource needs, equipment, maintenance, etc.

● Distribution – How do you get your product or service to your customer?

● Location and facilities – Ensuring your operations are located near, and have access to, the facilities required to ensure the success of your business.

● Equipment – Having access to the equipment required to produce your product or service and conduct your business.6

Performance targets and KPIs for teams and individuals are often set at the operational level on the basis of identifying key operational activities that are seen to drive organisational success.

6 J. Heizer and B. Render, 1996, Production and operations management, 3rd edn, Prentice Hall, New Jersey, p. 31.



Learning activity: Raising productivity through better performance management

Watch the video ‘BSBHRM503A: Raising productivity through better performance management’ on IBSA’s YouTube channel at <http://youtu.be/j_ab-dFMPos>.

Answer the following questions:

● What changes have recently occurred in the workplace at Callaghan Collision Centre?

● What are the benefits to employees of the new performance management system?

● Apart from productivity, what are the other benefits that Callaghan Collision Centre has witnessed?



Consult on work allocation and resourcing

As a manager with responsibility for meeting team or departmental performance objectives and setting work plans for your employees, you will need to consult with a range of stakeholders to allocate work for individuals and determine the human, physical and financial resources available.

You may need to consult:

● HR business partners, for example, for recruitment advice

● colleagues and specialist resource managers

● health and safety committees and other people with specialist responsibilities

● your manager or supervisor

● other managers, project managers and supervisors your employee is responsible to in addition to yourself

● employees

● people from a wide range of social, cultural and ethnic backgrounds, and people with a diverse range of mental and physical abilities.

Consultation demonstrates your commitment to considering the needs of all employees – senior management, line management, workers and those affected by work allocations and targets – and will certainly help acceptance and employee support of performance management processes once it comes time to implement them. Consultation can complicate decision-making, but often results in more engagement and better decision-making and planning at the end of the consultation process.

Consultation skills You will need to possess or develop the following essential skills for consultation on work allocation.

Interpersonal skills

In consultation, it is important to understand how you relate to others within an organisation.

Consider the following essential interpersonal skills:

● Do you demonstrate professional respect?

● Do you work to foster positive interpersonal dynamics that lead to results?

● Do you recognise, respond and adapt appropriately to emotions shown by others?

● Do you respond constructively to feedback?



Teamwork skills

During consultation you will need to work with others as an effective team member, team leader and/or manager.

Consider the following essential teamwork skills:

● Can you build and facilitate teams, e.g. groups for consultation?

● Do you build support and engagement for team objectives?

● Do you demonstrate professional respect and respect for rules within teams?

● Do you share knowledge or hoard it?

● Can you organise detail and clearly communicate relevant knowledge?

● Do you use the skills and knowledge of others to their full potential, or try to do everything yourself?

● Do you work to develop skills and knowledge in others?

Technical skills

Knowledge of the process, products and services provided by the workplace.

● Do you stay abreast of workplace and technological developments?

Identifying stakeholders You need to identify all stakeholders who may be impacted by your resourcing and allocation of work to individuals, or who may have some impact on how you will implement work. Stakeholders include everybody who has an interest in performance management processes. To identify stakeholders, list everyone you can think of that is affected by the performance management and work plans of individuals.

Mapping stakeholders Once you have identified stakeholders, you may find you have a long list of people that are potentially affected by your performance management processes and allocation of work for individuals. The level of power, interest and influence of these people will vary. For this reason it is important that you complete an assessment to determine the level of consultation required for each stakeholder identified.

A stakeholder map records who your stakeholders are and their level of power, influence and interest. A stakeholder map allows you to see who you need to focus on to ensure the successful development and implementation of your work plans and special projects.



To complete this assessment, you should map out your stakeholders using your knowledge of their level of power (influence) and interest on a power/interest grid like the one below:

An individual’s position on the grid shows you the actions you will need to take with them:

● High power, interested people: These are the people you must fully engage with, and make the greatest efforts to satisfy.

● High power, less interested people: Engage enough with these people to keep them satisfied.

● Low power, interested people: Keep these people adequately informed, and talk to them to ensure that no major issues are arising. These people can often be very helpful with operational details and coordinating work.

● Low power, less interested people: Monitor input from this group of people, but do not bore them with excessive communication.7

Learning activity: Identify and assess stakeholders

Suppose you are planning on allocating work for a special project. Considering your current role, identify one example of a stakeholder for each quadrant on the grid provided. Detail why you have classified this person in this category.

Alternatively, research a business or simulated business and imagine you need to consult with various stakeholders to allocate work and develop a work plan in consultation with others.

Some examples of simulated businesses can be found online at <http://simulations.ibsa.org.au/>.

7 MindTools, ‘Stakeholder Analysis: Winning Support for Your Projects’, MindTools, viewed September 2014, <http://www.mindtools.com/pages/article/newPPM_07.htm>.



Keep satisfied Manage closely

Monitor (minimum effort) Keep informed

Develop performance standards and work plans with employees In order to allocate work effectively, you will need to develop work plans in consultation with your employees. In addition to being documents that are negotiated to some extent with your staff, work plans need to be developed in accordance with the employee’s position description and conform to performance expectations and standards required by the role, operational planning at higher levels, and the values of the organisation.

Confirm performance standards Performance standards may be qualitative (descriptive) or quantitative (numeric). Quantitative standards, as measured by KPIs, for example, will be discussed in more detail in the following section.

Performance standards are often set out in position descriptions. These describe, in a general way, the types of activities an employee may be expected to carry out on a day-to-day basis, under what conditions and to what level of proficiency. (An example position description is included in Appendix 2 of this Student Workbook.)

Some aspects of organisational roles may be ongoing and therefore difficult to define in terms of timeframed goals, objectives and targets. For example, ‘superior customer service’ may be essential to achieving strategic objectives. All customer service staff or any employee that makes customer contact may be expected to conduct themselves in accordance with company values and be friendly, courteous and helpful.

To assist performance management, job standards should be described in a way to facilitate measurement or observation. Let’s look at an example.



Example: Job standards – Answering the telephone

The most common ways to describe and measure standards of acceptable performance include: time, accuracy, quantity and quality:

● Telephones are answered by the third ring. (time)

● Callers are transferred to correct extensions. (accuracy)

● Customer service agents are expected to answer at least three enquiries per hour.

(quantity)

● All calls are answered with courteous tone of voice. Greeting includes employee’s name, department and ‘How may I help you?’ (quality)

Importantly, job standards do not need to include all types of measures; however, each job standard should be measurable or observable in some way.

When allocating work over a set timeframe and in the context of performance management systems, for example, between performance appraisals, you will need to refer to position descriptions or negotiate performance standards. You will need to ensure such standards are compatible with both the employee’s position description and operational planning.

Set work in in accordance with operational planning Allocating work needs to be negotiated with employees to ensure they agree and understand your performance expectations, and allocated in such a way as to advance the goals of the organisation overall. The easiest way to this is to develop work plans that are explicitly linked to operational planning at higher levels.

Consider the following work plan for a customer service employee at Australian Hardware:

Employee work plan: Customer service

Operational plan reference

Activity Standard/outputs/targets

Financial Generate sales revenue through customer interaction.

$10,000/month sales revenue and referrals (quantity).

Customer satisfaction

Provide product advice and work to understand and satisfy customer needs.

Customer service rating 8/10 (quantity).

Use Australian Hardware sales methodology to ask questions and provide solutions (quality).



Employee work plan: Customer service

Operational plan reference

Activity Standard/outputs/targets

Efficiency Provide quick service, accurate information and operate point of sale terminals.

Less than 5% error rate (accuracy).

Complete sales at terminal under three minutes (time).

Learning and development

Keep up-to-date with product knowledge, particularly new range of homewares products and Australian Hardware’s own-brand power tools.

Develop sales and service expertise.

20 hours of customer service training per quarter.

Remember that every work activity that an employee carries out, no matter how seemingly unimportant, needs to be a part of achieving the aims of the organisation. Misalignment of strategic and operational plans and employee work plans is a sure sign of trouble. At higher planning levels, it is important to determine what activities drive overall success and to ensure that these activities may be easily translated into the work of each individual within the organisation.

Learning activity: Allocate work

Suppose you are planning on allocating work to an employee for a special project or for ongoing work and:

● Identify how work is allocated in your organisation, for example, is it specified in organisational performance management policies and procedures?

● Source organisational work planning templates.

Complete the following:

● Set some provisional activities and standards for work in accordance with the employee’s position description.

● Explicitly link each activity or standard to the organisational, departmental or team operational plan.

● Plan a session with the affected employee to discuss and revise their work plan based on the employee’s input.

Alternatively, research a business or simulated business and imagine you need to consult with various stakeholders to allocate work and develop a work plan in consultation with others. Some examples of simulated businesses can be found online at <http://simulations.ibsa.org.au/>.



Code of conduct and organisational values In addition to making sure that you allocate work in accordance with organisational planning and position descriptions, you will need to ensure that the employee understands and is able to carry out their work in accordance with any code of conduct, business ethics or legislative requirements that that may apply to their role. More generally, as organisational values are aligned to strategic plans, employees should be made aware of those values.

Codes of ethics and codes of values often set out a number of principles that employees must apply to their work. Codes of conduct may be even more specific and prescriptive, than codes of ethics and may be mandated by legislation, or an industry requirement.

Industry codes of conduct may include:

● the Life Insurance Code of Conduct

● the Environmental Claims in Advertising and Marketing Code

Let’s look at an example code of ethics/code of conduct:

Example: Australian Hardware Code of Ethics

Employees and officers of Australian Hardware are expected to:

● Respect and support the core values of the organisation:

○ performance excellence

○ value for investors, customers and employees

○ personal and professional development

○ diversity

○ sustainability.

● Respect and treat others (colleagues, managers, reports, clients, customers and organisational stakeholders) with fairness.

● Act in accordance with relevant legislation, standards and industry codes of practice.

● Act honestly to protect the reputation of Australian Hardware; avoid the fact or appearance of conflict of interest.

● Protect the privacy of others in accordance with organisational privacy and recordkeeping policies.

How might the above code of conduct apply to the example work plan of the Australian Hardware employee above?



Learning activity: Review a code of ethics/code of conduct

Obtain a copy of your organisation’s code of ethics or code of conduct and review its contents.

Tip: If you are currently employed, you can use your organisation’s code of ethics/conduct; however, if you are not employed, you can obtain an example by searching the internet for ‘code of ethics/ code of conduct’.

The following sites may be useful:

● Monash University, 2014, ‘Monash University ethics statement’, Monash University, viewed December 2014, <http://adm.monash.edu/human-resources/ethics/>.

● The University of Western Australia, 2014, ‘UWA code of ethics and code of conduct’, The University of Western Australia, viewed December 2014, <http://www.hr.uwa.edu.au/publications/code_of_ethics>.

Answer the following question:

● How is the code consistent with organisational plans and goals?

Develop performance indicators

As a manager working in the context of a performance management system, you will need to set clear expectations for people working in particular roles. You will need to set a quantitative baseline for performance by developing performance metrics to enable monitoring, align performance metrics to organisational goals, and use tools such as balanced scorecards to track organisational and individual performance against key result areas.

Develop performance metrics In order for performance to be effectively monitored and evaluated, it needs to be measured. Performance is generally measured using key performance indicators (KPIs).

KPIs measure an organisation’s performance in critical areas, often called key result areas (KRAs). KRAs may include general areas of performance important to the business or the employee’s role, such as: financial measures, productivity, customer focus or training and development.



To be useful in the context of performance management, KPIs should generally conform to the following three requirements:

1. KPIs should promote common, clear understanding. They must be:

a. simple enough for anyone to understand

b. calculated in a standard way across the organisation

c. documented.

2. KPIs should correlate with performance. They must:

a. directly measure the results of a process

b. be directly affected by changes to that process

c. not be directly affected by factors outside of that process.

3. KPIs, even ‘soft’ KPIs, such as behaviours and attitudes, should be quantifiable; i.e. they should be expressed as a number or a percentage so that they can be measured.

KPI types Objectives, targets and the KPIs that measure performance against objectives and targets can be classified into three types: input, process and output.

● Input KPIs measure the activities that are designed to facilitate improvements in performance results. These activities include management actions to implement performance management and achieve organisational goals, such as holding performance review meetings, coaching or providing training.

● Process KPIs measure the efficiency of processes, for example, the number of times stock is sold or used over a period of time (inventory turnover or stock turn). Another example, more geared towards the measurement of individual performance, might be contribution to the improvement of team processes or the support of co-workers to do the same.

● Finally, output KPIs measure the results of inputs and processes. These could include, for example, productivity levels or number of sales per month.

KPIs are often said to be leading, in that they indicate future performance; or lagging, in that they reflect past performance. For example, sales training numbers may indicate future sales performance, while current sales figures reflect past activity.

While lagging indicators such as sales revenue are important for establishing where an organisation or employee is in relation to a set goal, leading indicators are essential tools in performance management. This is because they are both focused on the future (and therefore compatible with performance management practices, which seek to develop the potential of employees) but also because, more importantly, they identify what drives success – on the terms defined by the particular organisation.



Generating KPIs When generating specific team or individual KPIs, there are three commonly used methods:

● Setting KPIs at organisational, departmental, team, and individual level by identifying what success looks like at each level and what drives it.

● Setting KPIs based on different organisational stakeholder perspectives, e.g. ‘balanced scorecard’.

● Cascading corporate goals and objectives down by:

○ determining what drives corporate and departmental goals and objectives and break larger, more generic goals up into their component parts; namely, determine what the achievement of goals at that level in turn depends upon or is driven by, for example:

– sales = prospects x conversion rate x average sale

– average sale = average items per sale x average cost per item

○ designing the work of departments, teams and individuals based on cascading KPIs.

Let’s take a closer look at balanced scorecards and cascading KPIs.

Balanced scorecards The balanced scorecard approach, based on the work of management experts Kaplan and Norton, aims to measures organisational performance from several different stakeholder perspectives in addition to the financial perspectives of investors and shareholders. These latter are often lagging and they don’t therefore really capture the work of individuals that drive overall organisational success.

When using the balanced scorecard method of developing KPIs, seek out suitable KPIs that measure the following perspectives.

Area Description

Financial performance ● utilisation of assets

● optimisation of working capital

● focus on top 10% of customers, etc.

Internal operational performance

● delivery in full, on time

● effective relationship with key stakeholders

● optimising technology.

Customer orientation ● seamless service

● increased customer satisfaction, etc.



Area Description

Learning and growth ● empowerment

● increasing expertise

● adaptability, etc.

Environment and community*

● supporting local businesses

● community leadership

● environmental compliance and leadership.

Employee satisfaction ● positive company culture

● retention of key staff

● increased recognition.

Cascading KPIs Objectives and KPIs at a lower level of the organisation should be aligned with objectives and KPIs set at higher levels. In this respect, KPIs are said to ‘cascade’ from higher-level organisational goals. If the alignment is not clear, you need to question whether the KPI is appropriate. The simplest method of creating KPIs is to cascade them from the goals of the organisation as a whole, or the department/section that the individual or work team is a part of.



Let’s look at an exampleExample: Cascading KPIs from a numeric goal

Imagine that we want to develop KPIs for a sales team as part of their effort in achieving a profit after tax of $2 million. Lower-level KPIs (bolded) express team or individual sales team KPIs relevant to realising the organisational goal.8

8 K. Dwyer, ‘Cascading performance indicators from numeric goals’, Change factory, viewed December 2014, <http://www.changefactory.com.au/ourthinking/articles/ cascading-performance-indicators-from-numeric-goals/>. Adapted with permission.



Pitfalls Sometimes what is measured in terms of individual, team and organisational performance ends up being what is easy to observe and measure (or was has always been observed and measured) and not what it is important to measure. In other words, don’t measure an aspect of performance because it is easy to express as a number or ratio – measure it because it matters.

Let’s look at two scenarios in which the relation of KPIs to business goals is poorly understood or correlated.

Scenario 1: Credit management

One typical credit management organisation includes minimisation of Bad Debt Expense (BDE) as one of its principal goals; most people within this organisation have BDE as one of their department’s main KPIs.

Unfortunately, the definition of what constitutes BDE is neither widely known nor very standard; for example, own staff costs for dealing with bad debts is not included in the definition. One result is that substantial well-intentioned effort is expended in trying to improve this KPI, with unpredictable results.

To add to the difficulty, one element that is defined as being a BDE component is the change in provision for bad debt. This can significantly affect BDE on a quarterly basis; it is not unknown for the change in this component in one quarter to be reversed in the next.

Let’s look at a second example.

Scenario 1: Recruitment costs

Consider an HR process that manages recruitment of staff with a KPI of ‘Staff Recruitment Cost Percentage’.

The definition is ‘staff recruitment cost as a percentage of total annual staff cost’ and the calculation is:

100 x [staff recruitment cost per month] / [total staff cost per annum]

This looks reasonable at first glance. There is nothing wrong with dividing a monthly cost by an annual reference base, even last year’s annual reference base.

The fatal flaw, however, is that the staff recruitment cost is only partially dependent on the efficiency with which the process is performed; it can be highly dependent on factors external to the process, such as the rate of staff turnover, retirements, rate of business expansion, etc.

Consequently, in explaining variations in the KPI, the accountable manager for the process will often be explaining factors outside of the manager’s control and process’s control limits.



KPI examples Let’s look at some example KPIs and definitions.

Example: Definitions and calculations

KPI name Definition Calculation

Approved change orders per total ECO

Change orders approved by client as percentage of total requested engineer change orders (ECO).

100 x [approved change orders] / [requested change order]

Churn Loss of customers per year as a percentage of total customers.

100 x [lost customers] / [total customer]

Bad Debt Expense (BDE)

Write-offs occur ‘nn’ days after final billing with no payment:

● plus manual write-offs

● less recoveries made against previously written-off amounts (including sale of bad debt but excluding effect of expenses relating to sale of bad debt)

● plus all agency fees (including fees unrelated to recoveries plus change in provision for bad debt calculated at 6% of mass market debt)

● plus individual assessment for major accounts.

Note: In-house salaries and expenses excluded.

[bad debt write off] – [recoveries + sale of bad debt]+ [agency fees] + [provision for bad debt]



Learning activity: Research or develop KPIs

There are many standard KPIs used in industry, although care must be taken in defining measurements so that the KPIs are like-for-like if you are considering benchmarking.

There are many web resources available; just use an online search engine for the terms:

● ‘KPI forums’

● ‘KPI libraries’.

Consider your own role and answer the following questions:

● What KPIs are applicable?

● How are these related to organisational planning?

● How are KPIs in your organisation set: by perspective or by cascading?



● What KPIs are relevant to your organisation and your staff?

● How can you ensure that you set KPIs to:

○ measure what you need to measure in order to understand what drives success in your organisation

○ and to performance manage to achieve success through your people?

Manage performance management risk

Risk assessment is an essential component of all business planning. As such, it is an essential part of performance management. For instance, when allocating work, you will need to take into account the uncertainty inherent in planning for the future. How uncertain is the achievement of business goals through current or planned performance management practices? What compliance risks are entailed in managing people? What risks exist to the organisation, in terms of lost revenue or cost of training, in the course of developing people? What is the risk to the organisation of wasting effort to develop and train individuals who leave before the return on your investment in people is realised?



According to the risk management standard, AS/NZS ISO 31000:2009 Risk assessment – general comprises the overall process of:

1. Risk identification.

2. Risk analysis to determine the nature and level of risk.

3. Risk evaluation to determine the acceptability of the risk and the necessity for implementing controls.9

Importantly, since risks must be continuously re-evaluated, risk assessment is a continuous cycle. Whether you begin assessing risk before you set work or undertake performance management of people, you will need to continually revisit risk assumptions based on new information as it becomes available.

Let’s look at the basic questions you need to ask when performance managing people10:

● What are the priority work issues, strategies and objectives?

● What are the risks associated with the setting work or managing people? In other words, what could go wrong?

● What are the consequences of the risk to the organisation? Such consequences may be described as, for example, insignificant, minor, moderate, major, or catastrophic; they could also be given a dollar value.

● What are other consequences? Are there any other consequences? For example, to clients or customers, or perhaps an environmental or social impact?

● What is the likelihood or probability of the risk eventuating? As with consequence, likelihood may be described qualitatively; for example, as certain, likely, moderate, unlikely or rare.

Where possible, likelihood may be expressed quantitatively as chance or probability, for example, a 5% risk (p = 0.05). Both likelihood and consequence may be taken together to assess the risk level and evaluate the risk to determine the acceptability of the risk or possible actions.

● What is the mitigation strategy? Develop a mitigation strategy or contingency plan to reduce the risk.

Let’s look more closely at assessing the level of risk, evaluation, mitigation and contingency planning for performance management.

9 Standards Australia, 2009, AS/NZS ISO 31000:2009 Risk management – principles and guidelines, SAI global, Sydney, p. 4. 10 Adapted from: Standards Australia, 2009, HB 299-2008 Workforce planningSAI global, Sydney, p. 34.



Assess the level of risk The level of risk is determined by taking together the likelihood of risk and the consequence of risk. In qualitative terms, the level of risk may be determined by use of a matrix.

Consider the following example risk matrix.

CONSEQUENCE

Insignificant Minor Moderate Major Catastrophic

LIKE

LIHO

OD

Almost certain

HIGH HIGH EXTREME EXTREME EXTREME

Likely MEDIUM HIGH HIGH EXTREME EXTREME

Moderate LOW MEDIUM HIGH EXTREME EXTREME

Unlikely LOW LOW MEDIUM HIGH EXTREME

Rare LOW LOW MEDIUM HIGH HIGH

In the example matrix above, the level of risk when the risk likelihood is moderate and the risk major is extreme. For example, an organisation may deem the understaffing of a sales team as major because it would reduce income by $1,000,000. The risk is deemed moderately likely because of uncertainty in the labour market and potential for the underperformance of the performance management system to reduce workforce attrition.

There are other ways of using a matrix to express the combined accounting of consequence and likelihood. For example, in the matrix below, business importance is compared to the chance of change; for instance, change to the labour market, business conditions, or to performance management itself.

MEDIUM RISK

HIGH RISK

LOW RISK

MEDIUM RISK

Chance of change

Bus

ines

s im

port

ance



Once you have determined the level of risk, different risks may be compared, assessed for acceptability, and then acted upon.

Evaluate risk Risk evaluation is the determination of the acceptability of the risk and the type of action to be taken on the basic of the level of risk. Consider the table below.

Extreme ● IMMEDIATE senior management action e.g. serious threat to business planning

High ● Action plan needed, allocated responsibilities e.g. damage to valuable assets

Medium ● Risk requires only monitoring and review e.g. loss of revenue due to inadequate performance management

Low ● Risk accepted – but not ignored e.g. risk of slight understaffing in non-business critical areas

The determination of the acceptability of risk and the general actions to take will be governed by the nature of the risk and organisational policies, procedures and strategies. For example, organisations may, as a component of workforce strategy, transfer the high risk associated with staffing, training and performance managing non-core aspects of the business to external organisations. For instance, a manufacturer and retailer may choose to focus on locating skilled shop labour and contract another organisation to conduct call centre operations on its behalf. Organisations may also take internal steps to reduce risk to the planning and development of performance management.

Develop mitigation strategies or contingency planning In order to reduce the impact of risks associated with the retention or development of the workforce, it is always a good idea to develop mitigation strategies or contingency plans. A mitigation strategy is an action taken to reduce the risk to an acceptable or manageable level.

A contingency plan, on the other hand, is a ‘plan B’; planned action to be taken ‘just in case’ a risk eventuates. For example, a mitigation strategy for reducing the risk to retention could include improvements to performance management, career planning, and training to encourage talent to stay.

A contingency plan could include potential changes to operations or business structure to minimise the impact of performance management risk on business plans or profitability. For instance, underperforming departments could be closed or sold to allow an organisation to concentrate its talent in staffing better-performing departments.



Policies, plans and procedures As part of managing risk associated with performance management, you will need to work within the risk management framework in place within your organisation. To manage risk, you will probably need to follow a risk management process similar to the process outlined above, itself based on AS/NZS ISO 31000:2009 – Risk management – general. You will also need to complete recordkeeping, such as updating risk registers. An example of an organisational risk register is provided in Appendix 3 of this Student Workbook.

Learning activity: Manage performance management risk

Consider your organisation or an organisation you would like to research. Imagine you are about to implement a performance management system or work within an existing system to manage your employees’ performance.


1. Identify risks associated with the strategies or objectives.

2. Analyse and evaluate the risks.

3. Using the risk management plan or framework in use within your organisation, identify risk mitigation strategies or develop contingency planning to reduce risk to acceptable levels. Ensure you follow recordkeeping procedures such as the completion of risk registers.

Section summary

This section provided an overview of performance management; creating work plans in consultation with others; developing performance measures; and managing risk associated with performance management. You should now understand how to allocate work in accordance with operational planning.

Further reading

● Armstrong, M., 2006, ‘Chapters 1 and 4’, Performance management: key strategies and practical guidelines, 3rd edn, Kogan Page, London.

● Australian Human Resources Institute (AHRI), viewed December 2014, <http://www.ahri.com.au>.

● Dwyer, K., ‘Cascading performance indicators from numeric goals’, Change factory, viewed December 2014, <http://www.changefactory.com.au/our-thinking/articles/cascading-performance-indicators-from-numeric-goals/>.

● Dwyer, K., ‘Essentials of performance management’, Change factory, viewed December 2014, <http://www.changefactory.com.au/our-thinking/articles/ essentials-of-performance-management/>.



● Dwyer, K., ‘Managing people for profit’, Change factory, viewed December 2014, <http://www.changefactory.com.au/our-thinking/articles/managing-people-for-profit/>.

● Heizer, J. and Render, B., 1996, Production and operations management, 3rd edn, Prentice Hall, New Jersey.

● Hill, P., 2010, Generating & selecting KPI sets (eBook), Modulus Pty Ltd, Brighton, Victoria.

● MindTools, ‘Stakeholder analysis: winning support for your projects’, MindTools, viewed December 2014, <http://www.mindtools.com/pages/article/newPPM_ 07.htm>.

● Mirror42, 2011, KPI library, viewed December 2014, <http://kpilibrary.com>.

● Monash University, 2014, ‘Monash University ethics statement’, Monash University, viewed December 2014, <http://adm.monash.edu/human-resources/ethics/>.

● PeopleStreme, ‘What is employee performance management?’ PeopleStreme, viewed December 2014, <http://www.peoplestreme.com/what-is-performance-management.shtml>.

● PricewaterhouseCoopers, 2009, Performance management matters: Sustaining superior results in a global economy, available online, PWC Canada, viewed December 2014, <http://pickmybrain.org/wpcontent/uploads/2010/01/Performance-Management-Matters-Report-0609-en.pdf>.

● Standards Australia, 2009, AS/NZS ISO 31000:2009 Risk management – principles and guidelines, Standards Australia, Sydney.

● Standards Australia, 2009, HB 299-2008 Workforce planning, Standards Australia, Sydney.

● The University of Western Australia, 2014, ‘UWA code of ethics and code of conduct’, The University of Western Australia, viewed December 2014, <http://www.hr.uwa.edu.au/publications/code_of_ethics>.

● Tovey, M., Uren, M.-A. L., and Sheldon, N. E., 2010, ‘Chapters 1–3’, Managing performance improvement, 3rd edn, Pearson Australia, Frenchs Forest, NSW.

Section checklist

Before you proceed to the next section, make sure that you are able to:

analyse business strategy and operational plans to determine human resources requirements

review the external business environment and its likely impact on the organisation’s human resources requirements

consult line and senior managers to identify human resources needs in their areas

review the organisation’s requirements for diversity in the workforce



develop options for the delivery of human resources services that comply with legislative requirements, organisational policies and business goals

develop and agree on strategies and action plans for the delivery of human resources services

agree on and document roles and responsibilities of the human resources team, line managers, and external contractors.


Section 2 – Design Performance Management Systems and Assess Performance Student Workbook

Section 2 – Design Performance Management Systems and Assess Performance

The focus of this section is on designing and adjusting performance management systems and assessing performance. Section 2 provides useful tips on designing performance management processes that are consistent with organisational objectives and other requirements, training others on aspects of performance management, and implementing performance management.

Scenario: Assess performance

Pat Lee is the Garden Products Manager at the Australian Hardware Wollongong store. Pat is responsible for following the organisation’s performance management policy to develop her staff and ensure her staff performs to the level required by the business.

As part of following organisational processes, Pat collaborates with each of her employees to set targets and KPIs. She ensures that employees understand what is expected of them and how performance will be measured over the period of appraisal. Development options depend on performance and the goals that are set for the monitoring or probationary period.

To keep employees on the path to success, Pat intends to take a proactive approach to managing; she coaches her staff as the need arises and before performance problems are allowed to worsen.

As part of organisational requirements, Pat needs to carry out regular performance appraisals. After each appraisal, she will then need to adhere to the relevant record keeping requirements, which include safe storage and forwarding of copies of development plans to HR.


In order to implement performance management and assess performance, you must be able to:

design performance management and review processes to ensure consistency with organisational objectives and policies

train participants in the performance management and review process

conduct performance management in accordance with organisational protocols and timelines

monitor and evaluate performance on a continuous basis.


Student Workbook Section 2 – Design Performance Management Systems and Assess Performance

Design performance management processes

You will need to consider the organisation’s business and strategic planning, organisational needs, and the components of performance management systems in order to develop effective performance management processes. You will need to develop and maintain policies and procedures, ensure compliance with legal requirements, ensure flexible processes and understand the drivers of performance among personnel.

Performance management system components Not every performance management system operates in the same way. There are some aspects of performance management that are essential for managing performance and some that are less critical. These are described below as ‘core’ or ‘optional’ inclusions.

Core inclusions Core inclusions are essential to most management systems. These include:

● job descriptions

● orientation induction and probation

● key performance indicators (KPIs)

● development and performance plans

● recruiting processes policies and procedures

● communicated goal, strategy and tactics

● reward and recognition schemes

● regular coaching and mentoring

● annual (minimum) formal individual performance reviews

● formal training and informal upskilling

● counselling, confronting and termination processes.

Optional inclusions Optional inclusions assist in the delivery of the core inclusions and are more appropriate in larger organisations. They include:

● succession planning

● employee surveys

● customer surveys

● annual training plans

● a competency framework

● policies on authority and behaviour

● written processes

● competency-based organisational design.

As described in Section 1, performance management systems and components need to be tightly integrated with other organisational systems and processes. For example, goal-setting needs to be vertically integrated with strategic and operational planning, while performance management activities need to be horizontally integrated with other management systems. A diagrammatic representation of a performance management system is provided in Appendix 1 of this Student Workbook.



Policies Many organisations choose to document performance management processes in the form of policies and procedures. Policies inform employees of the overall aims of the organisation (such as ensuring quality, consistency, fairness or legal compliance) with regard to particular aspects of operations and performance.

Policies generally include the following features:

In general, when writing policy, you should keep in mind the size and specific needs of the organisation.

Effective policies should:

● relate to organisational goals and objectives

● state the overall approach, principle or rule – but not deal with implementation

● define and explain specific or specialist terms.

Procedures Procedures support policy by providing employees with specific guidance on how to actually implement policy and perform particular functions. Procedures include the following, as applicable:

● step-by-step instructions for carrying out tasks and processes

● training requirements

● process for monitoring, reviewing and reporting

● requirements for documentation and recordkeeping.

Procedures are specified series of actions, operations or instructions that need to be followed correctly for a job to be done properly. Many organisations have procedures documented. These can be in the form of step-by-step instructions or a series of connected activities.

Purpose statement

• The context of the policy, why it is required, the desired standard or overall objective.

Scope • The application of the policy (the particular location, work group, department or clients to be affected).

Resources • Additional documents, related forms, etc.

Roles and responsibilities

• Who is responsible for what in the implementation of the policy.

Legislation • Identification of any legislation applicable to the policy.



Effective procedures should:

● relate directly to policies

● outline the implementation and application of the related policy

● clearly communicate step-by-step instructions that can be easily followed.

The language for policy and procedure documents should be simple and clear and not contain jargon or technical terms unless necessary. Procedures should use basic vocabulary where possible and simple grammar.

Develop processes for formal performance appraisal meetings

One example of a key process in a performance management system that may be documented in a procedure is the performance appraisal process.

The performance appraisal process (or performance review process) involves the evaluation of an employee’s performance as well as their development or training needs. Appraisals help develop individuals improve organisational performance, and feed into business planning. Formal performance appraisals are generally conducted annually or biannually for all permanent staff in an organisation. Each staff member is usually appraised by their manager.

During appraisals, managers should discuss with each team member:

● the goals set for the time period

● the key job performance requirements

● the agreed development activities

● any agreed actions as a result of coaching or counselling.

A performance appraisal meeting (or review meeting) is perhaps the most dominant component of performance management systems. They are also the most potentially stressful for both managers and employees alike. So it comes as no surprise that people often avoid them or conduct them in a way that will cause the least resistance and discomfort. You need to develop and maintain processes to ensure that performance appraisals happen on time and to the required standard of quality.

An example performance appraisal process is provided in Appendix 4 of this Student Workbook.

Ensuring compliance with legal requirements You will need to ensure performance management processes and policies and procedures conform to legal requirements and are reviewed and updated regularly as required. You will also need to ensure processes as described in policies and procedures – for example, performance appraisal procedures or grievance procedures – are consistent with, and supported by, other policies to avoid confusion over legal rights and responsibilities of managers or employees.

Schedule appraisals

Organise appraisal meetings

Allow time to prepare

Conduct appraisal

Document outcomes

Schedule follow up



Ensuring flexible processes It is important to ensure performance management processes are flexible enough to be applied to various roles and employment situations. Varied work situations may include:

● part-time work

● casual work

● contracted work

● job sharing.

Processes need to be flexible enough to be fair to employees. For example, performance reviews/appraisals, counselling or coaching sessions should be scheduled to allow part-time workers to participate at convenient times. Targets and performance metrics may also be adjusted to account for reduced hours or special circumstances.

Understanding performance drivers Performance management processes need to be cleverly designed in order to engage people, promote organisational learning and drive high performance. So what drives performance? In simple terms, there are three key drivers of behaviour. If people are going to change their behaviour or perform at their best, they need to believe that:

● The new behaviour is good for them in some way. ‘Good’ may come from a sense of belonging, remuneration, self-esteem, or many other personal motivating forces.

● Their peers and friends will support them in behaving in the manner required. People are affected by what they see as the ‘subjective norm’. If they believe that their peers and friends whose views they value do not support them demonstrating the required behaviour, they are unlikely to do so.

● They have the capability to behave in the way required. People need to believe that they have the necessary skills, knowledge, resources and authority to execute the required behaviour.

Therefore, performance management processes must be designed to take the psychology of people into account. Moreover, processes need to be promoted effectively to gain the support of personnel.

Learning activity: Enhancing performance through employee engagement

Watch the video ‘BSBHRM503A: Enhancing performance through employee engagement’ on IBSA’s YouTube channel at <http://youtu.be/XdF65iIZ-Ro>. Answer the following questions:

● How can employees at CPX Printing and Logistics communicate their improvement ideas?



● What is the main weakness of this system?

● What does Robert Emms from the Australian Institute of Management say is required to measure the gap between current performance and the target set?

● What advice does Robert Emms give James Bennett about how to make his performance management system work and how to engage all the employees in the system?

Train participants in performance management

Ongoing learning and development is essential in order to promote and implement performance management systems and provide participants with the skills they need to perform at the required level. Generally, training is important because it is a key part of the development of all individuals – both those who are managers and those who are team members.

Effective training:

● uses various training methods

● offers ongoing support systems, e.g. mentor, follow up

● uses ‘action learning’: tackling real issues in small groups called ‘action learning sets’



● caters for any special needs, e.g. language, literacy and numeracy (LLN) problems or disabilities

● complies with relevant legislation

● is monitored, evaluated and reviewed.

Let’s look at identifying training needs, training methods, arranging and delivering training, monitoring training effectiveness and specific management needs for training.

Identifying training needs Identifying the training needs is the first step in providing effective training for managers and employees participating in the performance management process. Before any training programs are developed, ask yourself: what are the skills that need to be developed and why? For example:

● a manager or management team needs to learn how to access performance management forms

● a manager needs skills for holding performance appraisal sessions to run sessions in accordance with organisational policy

● a manager needs coaching skills to develop their team.

To answer such questions, relevant individuals such as learning and development specialists, will carry out training needs analysis (TNA). A TNA should be conducted to identify:

● knowledge, skills, abilities and competencies required by managers or other participants; often set out in lists of competencies or competency rubrics, which compare competencies at different proficiency levels

● the personnel who are required to carry out relevant tasks

● the level of knowledge and skills among relevant personnel (skills audit)

● gaps between present knowledge and skills and skills required by the organisation

● learning styles, learning preferences, or special needs

● any support systems needed to allow new skills to be applied on the job, for example, regular monitoring, coaching and mentoring, access to procedures and templates

● the documentation needed for monitoring and evaluating training.

The key outcome of a TNA is a detailed understanding of any gap that exists between the level of present skills and the skills required by an individual to perform at the level required for the job and, ultimately, for the organisation to achieve its goals. With this information you will be able to develop training objectives, plan training to meet needs, and develop effective means of monitoring the success or failure of the training to achieve objectives.

An example of a skills audit/TNA template is available in Appendix 5 of this Student Workbook, while an example of a competency rubric is provided in Appendix 6.



Learning activity: Skills audit/training needs analysis

Review the skills audit/training needs analysis template in Appendix 5.

Perform a TNA on yourself with respect to the key performance management skill of identifying performance gaps.

Check out the ‘Workforce skills audit tool for planning function employees’ on the Local Government of South Australia website for a more detailed example that includes audit instructions by searching for ‘skills audit tool’ at:

● Local Government Association of South Australia, viewed December 2014, <http://www.lga.sa.gov.au/page.aspx?u=5271>.

Training methods and support In order to facilitate effective training and cater for various different learning styles, training methods need to be varied. In an ideal world you would conduct a thorough needs analysis on the learning styles of managers or employees, but this is not always possible in a large and busy workplace.

Some training methods and support include:

● Direct instruction – recognised TAFE and university courses, professional development workshops on-site or off-site

● accredited or non-accredited training

● e-learning – interactive, CD-ROM, DVD, online video demonstrations

● e-support, e.g. online tutoring, query logging forms

● presentation slides

● self-paced manuals – hard copy and online

● case studies

● simulation

● role-plays

● observation and feedback

● coaching

● shadowing

● mentoring

● staff meetings

● conferences and workshops with individuals or groups – face-to-face, tele/video/web conferencing, e.g. Skype.

You will need to ensure the practical delivery of training and learning outcomes. To do this, you will need to coordinate and schedule training, contract training providers and monitor the quality of delivery.

Let’s look at these topics in more detail.



Coordinate and schedule training To ensure training activities are effective, you will need to implement training in a coordinated way. You will need to plan regular training, training evaluation and integrate training with existing operations and performance management processes. You will need to plan regular performance monitoring and audit training programs to ensure and maintain the necessary competencies across the organisation.

Integrating training with regular operations is a great way to embed a culture of learning. It may also be the only viable approach to take. For example, in many labour intensive industries, it is usually inconvenient to take people off-the-job or off-site to train them. Another reason to integrate training with existing day-to-day activities is that it can be more cost effective to do so. Training can be expensive when taken off-the-job.

Contract learning providers Although training provided from within the organisation (on-the-job and integrated with normal operations) is often cheaper and more effective, you may often need to contract external providers of training services. For example, your organisation may not have people with the requisite training skills or qualifications to deliver the required training.

Occasionally the entire process of training – from training needs analysis to training delivery – may be outsourced. Even in this case, however, you will need to ensure the training delivery strategy is designed to meet your organisation’s overall objectives for the training as well as evaluate the training program to determine if it is achieving what it was intended to achieve.

You will need to negotiate the provision of training with the provider in accordance with organisational goals and other requirements, such as organisational procurement policies. For example, your organisation may have lists of preferred suppliers of training services that you must consult.

Arrange training delivery Whether or not you are responsible for the actual delivery of training, you should be aware of its essential components. Consider the general process entailed in running training sessions as follows.

Explain Explain the learning process, including:

● objectives of the training session

● how long the session will take

● how the session will be structured:

○ demonstration

○ time to practise

○ feedback provided; and if required, further demonstration, practise and feedback

● how you will assess competency.



Demonstrate Demonstrate and explain each step in the managerial skill.

Practise Allow the individual to practise what you have just explained and demonstrated.

You could ask the individual to explain each step to you as they practise. This allows you to check that they do, in fact, understand what they are doing.

Provide Feedback

Once the individual has completed practising, provide them with feedback. This is a good time to remind them of safety elements.

You will now have to make a decision as to the next steps:

● If the individual demonstrated that they are competent in completing the task/process, you should provide them with positive feedback and complete the training session.

● If the individual cannot complete the task/process competently you could do either of the following:

○ suggest more practise

○ you could return to explaining and continue the training, focusing on the areas that need improvement.

Monitor learning and development activities to ensure outcomes As a manager responsible for the effective training of participants, you will need to regularly monitor the quality of training in order to trigger remedial processes if the training program is not delivering the required outcomes. A quality assurance process for training may include (but is not limited to):

● defined standards of learning outcomes

● templates for delivery; for example, facilitator guides and student workbooks

● standards of attendance

● standards of training delivery

● standards of assessment methods and, possibly, standards of assessment outcomes

● expected frequency and duration of training

● preferred facilitators and facilitator requirements, such as facilitator qualifications, where necessary

● remediation processes available if quality is below standard, which may include:

○ revision of the training material

○ review of the facilitator’s performance (for instructor-led training) with consequences for inadequate delivery of training

○ financial penalty for external training providers.



Quality assurance measures should include both outcome measures – for example, the learning outcomes, application of skills on-the-job, and return on investment – and input or management measures, such as compliance with standard templates for creating facilitator guides and student workbooks or online learning.

Monitoring of the outcomes of the learning intervention should be arranged to be conducted as much as possible as part of the training process. For example, attendance records should be collected during instructor-led training or as part of the log-on process for online learning.

Some aspects of monitoring quality, such as the learning outcomes, may need to be measured for up to three months after the learning intervention.

The quality assurance process should be clearly documented.

Manager competencies Training for managers is important to ensure that they have the knowledge and key competencies to implement performance management systems. It is important that managers have the right skills required to carry out performance management processes – setting objectives, defining capabilities, selecting and using performance measures and indicators and, of course, using skills in providing feedback, counselling and coaching.11 Employees may also require information and training regarding their role in the process.

You will need to identify training needs, and then provide effective management training.

In order to implement performance management processes, managers need to identify performance gaps, provide feedback and manage talent.

You will need to provide training to assist mangers to identify performance gaps. Performance shortfalls relate to:

● the essential job requirements as identified in the job description:

○ quality, e.g. costs above budget, not meeting operational objectives

○ quantity, e.g. productivity below required levels, work bans, employee turnover

● job knowledge

● goals identified in the regular formal appraisal

● performance elements of agreed actions from coaching counselling and confronting sessions

● company policy standards, for example:

○ not completing performance appraisals on time

○ quality, health and safety or environment failure.

11 M. Armstrong, 2006, Performance management: key strategies and practical guidelines, 3rd edn, Kogan Page.



In addition, managers need to be able to identify behaviour shortfalls that directly or indirectly affect performance. Behaviour shortfalls relate to:

● dependability

● adaptability

● initiative

● disruptive behaviour

● breaching company policy and standards, for example:

○ matters of a criminal nature

○ bullying and harassment

○ overreaching authority level.

Training may also be required on regular monitoring of employee performance and analysis of performance data and personnel scorecards. Training may also be required on aspects of managing talent, such as proactive managing and coaching and implementation of rewards and recognition programs.

Learning activity: Plan training

Imagine you are a learning and development specialist in the HR department of Australian Hardware. You have conducted a skills audit for five managers and have found they are unable to conduct performance appraisals.


1. Review performance management policies and procedures and other business documentation for Australian Hardware.

2. Plan a training session for managers on conducting performance appraisals.

Australian Hardware simulated business information, including business and operational plans, financial information, and policies and procedures (including performance management) can be located online at <http://simulations.ibsa.org.au/>.

Implement performance management: monitoring performance

After designing and adapting performance management systems to meet the specific needs of you organisation and training participants, you will need to implement the system effectively. This will mean planning and scheduling specific activities, including ongoing coaching and support activities (discussed in detail in the next section), and regular monitoring of performance through the use of tools, such as performance appraisal plans, probationary period assessment forms and balanced scorecards.



Performance appraisal plans and checklists A key tool for planning and monitoring performance appraisals is the performance appraisal plan.

At the beginning of a cycle (e.g. the financial year, calendar year or anniversary of employment), it is important to plan and schedule performance appraisals so that everyone knows a) when they need to appraise another employee; and/or b) when they will be appraised by their manager.

The plan will need to ensure that every stage of the appraisal process (pictured below) can be completed within the required timeframes:

Performance appraisal plans are usually designed so that all employees are evaluated around the same time. While the benefit of this is that all feedback sessions are completed over a short timeframe, a serious drawback in practice is that the time taken to prepare and complete as many as 15 or 20 feedback sessions competes with other work activities. If this happens, appraisal sessions could be late and/or compromised in quality. If possible, appraisal sessions should occur regularly for each individual, for example, annually, six monthly or quarterly, but managers may need to spread out their team’s appraisal sessions over several weeks, a month or even more.

Whether plans are scheduled to occur within a brief timeframe for the organisation or spread out over a longer period, managers need to be notified about the expected deadlines for performing individual or team reviews. Managers are expected to comply within a reasonable amount of time with their confirmed schedule. This schedule may be followed up by the HR department to ensure that reviews are being completed.

The HR department may provide guidance and training as necessary to managers on how to conduct a performance appraisal session.

Learning activity: A performance planning checklist

A properly completed and filed performance planning checklist will ensure that key dates are recorded and followed up. It also ensures that employees have undertaken a goal-setting exercise and understand the performance standards that are expected. An example of a performance appraisal planning checklist for new employees is provided in Appendix 9.

For your organisation or an organisation you are familiar with, develop a procedure for completing performance appraisals that will ensure that:

● a checklist is completed for new employees

● key dates are transferred to an electronic system

● the checklist is filed correctly in accordance with recordkeeping procedures.

Schedule appraisals

Organise appraisal meetings

Allow time to prepare

Conduct appraisal

Document outcomes

Schedule follow up



Probationary period assessment Managing employees through probationary periods is a special case of performance management. An extra layer of monitoring is often required for a period of usually three months. Probationary periods may run concurrently with regular performance appraisal periods and so will need to be coordinated and scheduled to be appropriately spaced out. Examples of a probationary period assessment form and checklist are provided in Appendix 7 and Appendix 8 of this Student Workbook.

Balanced scorecards As discussed in Section 1, a key performance management tool for the monitoring of performance at all levels of the organisation is the balanced scorecard. A balanced scorecard utilises KRAs, KPIs and targets to concisely set out the overall performance of an individual, team or even whole organisation.

A personal balanced scorecard is used both to set KPIs that take multiple organisational stakeholders into account and also as a method of tracking performance.

The following example shows what a balanced scorecard could look like for manager of a chain store.

KRA KPI Target Result

Financial $ expenses 4% reduction in operating expenses for store

$ value of travel receipts Reduce travel expenditure to $3,000

Process Number of completed performance appraisals

100% performance reviews completed biannually

Accuracy of workplace documentation

Recordkeeping requirements completed with 97% accuracy

Customer satisfaction

Number of complaints by number of calls

Less than two complaints per quarter

% of rejected deliveries Less than 2%

% of performance management processes carried out

Performance management processes should be carried out for all employees twice per year

Professional development

Hours of professional development and training on customer service and management provided for team

Five hours of professional development, including coaching, for each team member



As a manager, you may refer to balanced scorecards to regularly track the performance of employees against targets and intervene with timely feedback or support when needed. Information relevant to monitoring employees against balanced scorecards (or other agreed performance standards) may be found in a number of places, including HR management systems, accounting systems, learning management systems and dedicated performance management recordkeeping systems.

Learning activity: Balanced scorecards and performance management

Research the use of balanced scorecards in your organisation (or an organisation you are familiar with) for the purposes of performance management. Answer the following questions:

● Does your organisation use balanced scorecards as an element of performance management?

● What are the benefits of using balanced scorecards?

● How would you use balanced scorecards to improve performance in your team?



Section summary

This section discussed the design of performance management processes; training others in performance management; and implementing performance management, including monitoring and evaluating performance. You should now understand how to assess performance in the context of performance managing people.

Further reading

● Armstrong, M., 2006, ‘Chapters 2, 3 and 5’, Performance management: key strategies and practical guidelines, 3rd edn, Kogan Page, London.


● Local Government Association of South Australia, viewed December 2014, <http://www.lga.sa.gov.au/page.aspx?u=5271>.

● Nankervis, A., Compton, R., and Baird, M., 2002, Strategic human resource management, 4th edn, Thomson Learning, Melbourne.

● Tovey, M., Uren, M.-A. L. and Sheldon, N. E., 2010, ‘Chapters 4–9’, Managing performance improvement, 3rd edn, Pearson, Frenchs Forest, NSW.

Section checklist


design performance management and review processes to ensure consistency with organisational objectives and policies

train participants in the performance management and review process

conduct performance management in accordance with organisational protocols and timelines

monitor and evaluate performance on a continuous basis.


Section 3 – Provide Feedback Student Workbook

Section 3 – Provide Feedback The focus of this section is on providing feedback on performance. Section 3 discusses the importance of providing regular formal and informal feedback to employees, including on-the-job coaching and formal performance appraisal.

Scenario: Provide ongoing and regular feedback

Recall that Pat Lee is the Garden Products Manager at the Australian Hardware Wollongong store. As previously noted, Pat intends to manage proactively to ensure her staff is able to perform to their potential.

Pat recognises that there is a balance to be struck – between intervening whenever she notices poor performance and allowing the poor performance to continue and perhaps get worse. She will use her judgement to intervene as needed and provide ongoing informal feedback between performance appraisals.

Pat will also offer formal coaching to staff when required to discuss at length employee’s performance and career-related goals when appropriate.

It will be important to deliver both negative feedback and positive feedback as required to encourage continued high performance.

Finally, Pat will need to follow organisational requirements for performance management recordkeeping.


In order to provide feedback in the context of performance managing people, you must be able to:

provide informal feedback to staff on a regular basis

advise relevant people where there is poor performance and take necessary actions

provide on-the-job coaching when necessary to improve performance and to confirm excellence in performance

document performance in accordance with the organisational performance management system

conduct formal structured feedback sessions as necessary and in accordance with organisational policy.


Student Workbook Section 3 – Provide Feedback

Provide ongoing feedback

As a manager, it is important to provide ongoing and regular feedback to staff on their performance, not just at, for example, half-yearly intervals during formal appraisal sessions. You will need to take a proactive management style to monitor often and intervene as necessary to prevent small performance problems from becoming worse and harder to deal with later on. There are also compliance reasons for providing regular feedback. You may need to provide adequate warning to poor performers and establish a track record of poor performance to support disciplinary action if necessary (this will be discussed in more detail in Section 4).

Let’s look at proactive coaching and management as well as models for providing feedback that may be useful in providing some structure to more or less spontaneous coaching and feedback sessions as they occur.

Appraisal-only management You need to regularly monitor performance and undertake interventions as required to keep performance on track.

Appraisal-only performance management is like driving by looking in the rear-view mirror.

The performance appraisal process is only one part of a systematic approach to managing the performance of people. The process of performance management extends beyond the practice of regular appraisals as discussed in the previous section. Likewise, a systematic approach extends beyond formally planned coaching sessions.

It is important to conduct regular monitoring and provide continual feedback to team members to ensure the achievement of organisational goals. By the time appraisal period comes around, or formal coaching has been undertaken, it may be too late to take meaningful action to resolve performance issues.

Proactive coaching and management No manager can identify and solve problems with performance management from their desk alone.

Active management requires active information gathering. This is sometimes referred to as:

● Management by Walking Around (MBWA)

● ‘Gemba’, which is going to the source of the problem (a Japanese word meaning ‘at the site’).

It is important to be seen by employees to be actively engaged in their work. It may be easier to gain support and buy-in for your suggestion when delivered close or immediately after behaviour has been observed. More positively, when you notice outstanding performance you can note and reward it during a crucial window of opportunity in which recognition may more effectively reinforce great performance or behaviour.



Several spontaneous coaching sessions (known as side-by-side sessions) as they occur in a work setting may be much more useful at encouraging the most productive behaviour and climate than half-yearly formal sessions or more formal coaching.

Learning activity: MBWA and Gemba

Packard and Hewlett pioneered the concept of Management by Walking Around (MBWA) in the early days of Hewlett-Packard. This approach ensured that Hewlett-Packard managers were well informed and were able to devise effective management strategies.

Using the internet, research the topics of MBWA and Gemba and complete the following:

● Find a case study, or write your own fictional case study, for a business where the MBWA/Gemba approach has led to an improvement in management.

● How could this approach be applied to performance management?

Informal feedback It is important to use the circumstances of work behaviour to build understanding of what your expectations are in actual work contexts. This makes spontaneous, informal feedback an invaluable tool for performance management, even though it may not be a documented process. For this reason, informal feedback, despite the fact that it is less planned and more conversational, should be intentional and goal-focused. Some structure may be useful, therefore, to underscore your intentions and ensure the effectiveness of the feedback. Side-by-side sessions are usually conducted as opportunity arises in the workplace. Although they are informal and appear casual, they are much more effective when they are purposeful and considered beforehand.

Let’s look at two models of informal feedback.



The feedback sandwich approach A common method of delivering feedback and staying positive at the same time is to deliver a ‘feedback sandwich’. Delivering a feedback sandwich means:

1. Beginning your feedback with a positive comment.

2. Delivering negative feedback in the middle.

3. Ending by giving additional positive feedback.

This approach can be useful but, if overused, or used to create an artificial sense of achievement, may undermine the performance objective of giving feedback. In fact, misuse of this method will destroy credibility and trust and devalue praise.

Don’t use this method if you need to make up positive feedback for the sake of delivering bad news. Teams will quickly perceive the dishonesty. The last thing in the world you want to do is to devalue positive feedback or praise by signalling that praise will always be followed by criticism of performance. Perversely, team members may begin to fear praise and avoid all forms of feedback.

Learning activity: Feedback sandwich

Research the term ‘feedback sandwich’. Make notes on ways to deliver feedback to achieve the best performance outcomes.

Read the article ‘The feedback sandwich is out to lunch’:

● S. R. Charvet, 2011, ‘The feedback sandwich is out to lunch’, Success strategies, viewed December 2014, <http://www.successtrategies.com/media/articles-interviews/the-feedback-sandwich-is-out-to-lunch/>.


● What is the danger inherent in always adhering to the feedback sandwich approach?

● What is the importance of emotional states in changing behaviour?



● What method does the author suggest to deliver feedback?

AID feedback model Another way to deliver feedback on is to deploy the AID feedback model. The three phases of this model are described below.

Phase Description

1. Action Describe the employee’s actions. It is a good idea to focus on one or two actions or aspects of behaviour with so as not to overwhelm the feedback recipient. In this phase, focus on the facts of the behaviour, use concrete examples and provide context.

2. Impact Describe the impact on people – both the impact on their work and the emotional impact on others if relevant. It is best to describe the impact rather than judge the person or focus on blame. In this way, feedback recipients are less likely to identify with their behaviour and evaluate it and its impact on others more objectively.

3. Development Describe and/or collaborate on identifying a concrete course of action to take to modify or regulate the behaviour. It is best to focus on existing strengths to leverage or get better at than to focus on deficiencies and behaviours to eliminate.12

Probably the main benefit of this approach, particularly with respect to encouraging employees to self-manage their performance and behaviour at work, is that is provides explicit information on the behaviour of the employee, explicit information on the emotional impact on others and, most importantly, explicit information on what to do about it. Therefore, the AID model is a useful scaffold or mental model of self-reflective behaviour. If taken on board, the recipient may be able to internalise the AID model and apply it to other examples and situations, taking charge of their own development.

12 Adapted from: A. Roberts, 2013, ‘Effective feedback – AID model’, Master facilitator, viewed December 2014, <http://masterfacilitator.com/aidmodelforeffectivefeedback/>.



Like the feedback sandwich approach, the AID feedback model should be used in a reflective and intentional way, matched to the needs of the particular work context and individuals concerned. Overuse of the AID model may be inappropriate, for example, when you really need to help the team focus on the positive in the face of poor results, or when individuals are not ready or able to modify their behaviour. Overuse of the AID approach could also possibly mark you as emotionally cold, prescriptive or pedantic.

Learning activity: Reflect on feedback

Consider the last time you provided feedback to an employee and answer the following questions:

● When did you deliver the feedback? Was it delivered immediately after the behaviour you wished to modify or praise?

● What model did you use?

● What was your intention in delivering the feedback? Did you have a clear idea of what behaviour you wanted to encourage?

● How was the feedback received?

● Did you consider the recipient’s feelings?



● What was the result? Did performance improve? Did the employee maintain the high –performance?

● What was the effect on other employees?

● How would you improve your own performance in delivering timely feedback?

Coach performance

Coaching is a collaborative process in which a coach (often, but not necessarily, a supervisor or manager), works closely with a coachee to identify performance goals, establish the current reality and performance gaps or shortfalls, discusses various options for achieving potential, and helps to plan concrete actions aimed at achieving agreed performance objectives.

When should you coach? Coaching is different to formal training in that it can be relatively unplanned and spontaneous and opportunistic. But how do you know when you should step in, or let employees work through the problems for themselves?



Consider the following:

● Observe the employee’s work and be alert for certain triggers or signs. For example, you may notice an attitude or behaviour creeping in that will negatively affect performance, or you discover a slump in the weekly KPIs.

● Coach when you want to focus attention on any specific aspect of the employee’s performance.

● Don’t hesitate – do it now. Coaching is a process that is most effective when it happens daily.

● Be sure you document any key elements that come out of your coaching sessions and store them in the employee’s file.

Tip: Characteristics of good coaches

Good coaches:

● understand employees’ jobs

● are visible

● lead by example

● practise what they preach

● are sincere and honest

● make decisions on facts not feelings

● do not procrastinate

● listen more than talk

● seek assistance when necessary.

Coaching can be a more or less formal process: it can be side-by-side and spontaneous, or it could be more planned and formal, and even constitute a part of formal processes such as performance appraisal, counselling or disciplinary processes.

Scenario: Workplace coach

Steve is a Department Manager at Australian Hardware with a team of eight employees. He notices that one of his staff members, Alex, seems to lack direction, displays low self-esteem and has a number of performance issues (he regularly shows up late for work and takes more sick days that the other employees). Steve has tried a number of things, but has had little or no success.

Steve spoke to Connie in HR at the Australian Hardware head office, who suggested he might try coaching Alex. Steve approached Alex and asked if he wanted to try coaching. They both agreed it was worth trying and they agreed to work together once a week over three months.

The first thing Steve asked was for Alex to write a list of the things he was good at and the things he wasn’t good at. This gave them both a focus on the areas they could work on to help him improve over the coaching and monitoring period.

Six months later the improvements were noticeable. Alex is now the first one at work every day and is being recognised as a motivated team member. Instead of potentially losing a staff member, Steve has gained a valuable asset and is now looking at more training to help Alex develop his career.



The GROW coaching model GROW is a simple but effective model for running coaching sessions. GROW is an acronym that stands for:

G Goal

R Reality

O Options

W Will

Coaches use the GROW model to help structure their planning for formal coaching sessions, or even informal, side-by-side sessions. Advance planning is essential for a more formal remedial coaching session. You will need to collect data, materials and records; structure the message to suit the needs and experience of the employee; anticipate possible outcomes and reactions; and select a time and place for the coaching.

Note that the coaching session does not need to rigidly follow the order of steps described below. Any genuinely two-way coaching conversation will develop in unplanned ways. Remain open to input and negotiation. Nevertheless, each element of the GROW model should be addressed at some point in the coaching session.

1. Goal Getting to the root cause of problems means asking your employee about what is happening and how the problem is affecting them. Often managers can leap to a conclusion about solving a performance problem. Important information that can help to solve the problem is often missed.

First, consult with the coachee to establish or recognise existing performance goals. Ensure the performance goals are relevant to organisational plans, realistic and agreed upon. Before committing yourself to a remedial coaching initiative, confirm that such a session is necessary by considering the following questions:

● Is there really a problem where an employee is not meeting a performance standard or target, or is that employee simply not performing quite as well as another while still performing to an appropriate standard?

● If a problem exists, is the problem correctable? Have previous attempts failed with this employee?

● Is the problem beyond the control of the employee – i.e. poor work environment, faulty materials, late deliveries, lack of information, equipment failures, and unrealistic deadlines?

Coaching is not the solution to all performance problems. Consider the exact nature of the performance issue as discovered in your monitoring of performance. Establish the purpose and importance of the session clearly.

2. Reality Next, establish the reality of current performance and the existence of a performance gap to overcome. Obviously, if the coachee doesn’t believe there is a performance gap to overcome, the coaching process will stall. You may need to come prepared to coaching sessions with evidence of underperformance, such as balanced scorecard information.



Tip: Challenge employees to achieve potential

Note that, for coaching to be about maximising the performance potential of an employee, there should always be a gap between targets and current performance. One (short-term) approach is to increase targets (and financial incentives) to provide a challenge. Consider that, if an employee’s performance consistently outstrips targets, their role itself may need to change and advancement may be the only long-term solution to retaining an over-performing employee.

3. Options Once you and your team member have explored the current reality, it’s time to start exploring the alternatives for solving the problem. It should be a two-way process, so encourage the team member for their ideas and views about what might be done.

Ask questions like:

● What other options have you considered for how we might handle this?

● What are the alternatives?

● How else could we approach this? What risks are involved?

● What are the possible risks involved with these other options?

● What constraints exist?

Next, you should discuss options for closing the identified performance gap. It is important to use active listening skills (concentrating, asking questions, paraphrasing, interpreting meaning, and responding appropriately) to uncover root causes for underperformance – those perhaps not already uncovered through the process of monitoring performance – and talk through the possible options to generate effective solutions that will work for the team member.

Encourage employee participation by:

● asking open-ended questions

● discussing the pros and cons of each idea and examining possible options

● anticipating potential pitfalls and roadblocks and then identifying alternative strategies collaboratively.

Acknowledge good suggestions but be prepared to tell the employee if you disagree with a proposed approach. Build on as many ideas from the employee as possible. Now you are ready to decide on how the desired outcome will be best achieved. Both coach and coachee should agree on the best option/s for progress and measurable goals by which progress can be gauged.

4. Will Finally, and perhaps, most importantly, you need to establish the willingness of the team member to improve their performance. Remember, the best approach to performance improvement is likely to be the one that the employee feels committed to achieving.



You should establish willingness by encouraging the coachee to commit to taking practical, observable measures to achieve performance goals. In this way, the team member will be unable to hide a lack of commitment through making vague promises.

Establish and agree upon a schedule of review at the coaching session to ensure the plan of action is working. Recap the actions you have agreed on and check for understanding. Acknowledge the employee’s participation and contribution to the discussion and end on a positive note. Set a follow-up date to review progress and stress that you are willing to help if required.

Follow up to make sure tasks are accomplished and remember to acknowledge achievement through regular feedback.

Record options Importantly, after the coaching session has been completed, you will need to document the session. There are several reasons for doing this:

● First, documenting sessions, outcomes and agreements underscores the seriousness of the activity and both the organisation’s and the employee’s commitment to the process of development and performance management.

● Second, in cases where further coaching, discipline, counselling or even dismissal is required, having documented evidence of ongoing and regular attempts to remedy poor performance is essential to establishing the fair treatment of employees. This is important for both ethical and legal reasons. The Fair Work Act mandates the fair treatment of employees in managing underperformance.

● Finally, you will need to ensure you follow recordkeeping procedures when documenting and storing coaching evidence to satisfy all internal organisational needs for information gathering and organisational learning, and to satisfy external legal requirements.

Learning activity: Plan a coaching session

Imagine you wish to coach an underperforming employee in your organisation. Plan a coaching session using the table provided below. What questions you ask each stage of the coaching process?

Stage Questions

Goal

Reality



Stage Questions

Options

Will

Conduct formal, structured feedback sessions

Formal, structured feedback sessions may include, for example, highly structured coaching sessions, probation period assessment sessions, performance appraisals, or counselling or disciplinary meetings (the latter will be discussed in more detail in the next section).

You will need to follow processes for delivering formal feedback to meet organisational needs and to engage employees and drive high performance. Let’s look at some tips for effective formal sessions.

Tip: Formal feedback

When the feedback session begins, show that you are committed to working towards a beneficial outcome for both the employee and the organisation.

● Start by acknowledging the employee’s strengths.

● Be open to the employee’s input and ideas. Remind them it is a two-way conversation.

● Listen and ask for the employee’s opinions.

● Remember the objective is to evaluate the job performance and not the person.

● Remember to address what’s important to the employee.

● Avoid attributing motives to their behaviour. Focus on the facts, not on the person.

● Discuss the potential for further career advancement.

● Take a positive focus by looking towards the future and not where performance has been poor in the past.

● Build the conversation around the employee’s goals for the upcoming period.



Notice that delivering formal feedback is not all that different from delivering side-by-side coaching or informal feedback. The difference rests in establishing the right balance between setting a positive tone and managing both procedural requirements and the occasional need to deliver bad news.

Document outcomes securely You will need to ensure clear processes exist for recoding outcomes in accordance with the organisation’s recordkeeping system. Records of performance, particularly regarding the performance of individuals, may be sensitive. Processes should be built into appraisals procedures to ensure business, legal and ethical needs, such as records security and employees’ privacy, are adequately met.

As part of implementing the performance appraisals process, and performance management more generally, you will need to take a systematic approach to recordkeeping and security. The Australian and international standard for recordkeeping is AS ISO 15489:2002 Records management. According to the standard, records management systems are based on developing and implementing recordkeeping policies, procedures, and practices to meet operational needs and comply with externally imposed standards such as legislation.13 While adherence to the standard is not mandatory, organisations may consider voluntary compliance in order to better integrate recordkeeping with all other management systems to enhance organisational learning and contribute to a high-performing organisation.

Learning activity: Delivering formal feedback and recording outcomes

Review the sample procedure for completing an appraisal provided in Appendix 4. Alternatively, research a business or simulated business and imagine and locate procedures for delivering formal feedback. Some examples of simulated businesses can be found online at <http://simulations.ibsa.org.au/>.

Conduct a role-play performance appraisal with a fellow learner, colleague or friend in accordance with the procedure.

Based on your experience with the role-play, answer the following questions:

● How effective is the procedure in practice?

13 Standards Australia, 2002, AS ISO 15489.1 – 2002: Records Management, Standards Australia International, Sydney, p. 8.



● What changes would you make to the appraisals process to make it more engaging or easier to complete?

● What are the recordkeeping requirements, if any?

Now consider your own organisation:

● What processes exist for delivering formal feedback on performance?

● How would you/do you implement the process in a way that maintains a positive tone while completing requirements?



● What are the legal requirements that apply?

● What recordkeeping requirements exist?

Section summary

This section discussed the importance of providing ongoing feedback and taking a proactive approach to performance management; coaching employees using the GROW model; and providing formal feedback, including conducting performance appraisal sessions in accordance with organisational requirements, such as recordkeeping. You should now understand how to provide informal and formal ongoing feedback on performance.

Further reading

● Armstrong, M., 2006, ‘Chapters 6, 7 and 8’, Performance management: key strategies and practical guidelines, 3rd edn, Kogan Page, London.

● Cashman, K., 2008, Leadership from the inside out: becoming a leader for life, 2nd edn, Berrett-Koehler Publishers, San Francisco.

● Charvet, S. R., 2011, ‘The feedback sandwich is out to lunch’, Success strategies, viewed December 2014, <http://www.successtrategies.com/media/articles-interviews/the-feedback-sandwich-is-out-to-lunch/>.

● Cherry, K., 2011, ‘Hierarchy of needs – the five levels of Maslow’s hierarchy of needs’, About.com, viewed December 2014, <http://psychology.about.com/od/ theoriesofpersonality/a/hierarchyneeds.htm>.

● Daniels, A. C., 2000, Bringing out the best in people: how to apply the astonishing power of positive reinforcement, 2nd edn, McGraw-Hill, New York.



● Hollyforde, S., and Whiddett, S., 2002, The motivation handbook, CIPD Enterprises Ltd., London.

● Kotelnikov, V., 2010, ‘Structuring a coaching session – the GROW model’, 1000 ventures, viewed December 2014, <http://www.1000ventures.com/business_ guide/crosscuttings/coaching_grow.html>.

● Roberts, A., 2013, ‘Effective feedback – AID model’, Master facilitator, viewed December 2014, <http://masterfacilitator.com/aidmodelforeffectivefeedback/>.

● Standards Australia, 2002, AS ISO 15489.1-2002 Records management – general, Standards Australia, Sydney.

● Whitmore, J., 2002, Coaching for performance: GROWing people, performance and purpose, 3rd edn, Nicholas Brealey, London.

Section checklist


provide informal feedback to staff on a regular basis

advise relevant people where there is poor performance and take necessary actions

provide on-the-job coaching when necessary to improve performance and to confirm excellence in performance

document performance in accordance with the organisational performance management system

conduct formal structured feedback sessions as necessary and in accordance with organisational policy.


Section 4 – Manage Follow Up Student Workbook

Section 4 – Manage Follow Up The focus of this section is on managing follow-up activities when performance managing people. Section 4 discusses performance development planning, seeking assistance and expert advice, rewards and recognition, managing poor performance and dismissal in accordance with organisational and legal requirements.

Scenario: Manage follow up

After conducting performance appraisals for the previous period at the Australian Hardware Wollongong store, it will be important for Pat to follow up. Pat will need to:

● discuss future goals with employees and set new work plans where required

● provide opportunities for support and development

● complete recordkeeping requirements.

Pat will also need to counsel a poorly performing employee, whom she may need to dismiss. It is important that Pat conducts the counselling process fairly and in accordance with relevant legislation, such as the Fair Work Act unfair dismissal provisions.


In order to manage follow up to performance management, you must be able to:

write and agree on performance improvement and development plans in accordance with organisational policies

seek assistance from human resources specialists, where appropriate

reinforce excellence in performance through recognition and continuous feedback

monitor and coach individuals with poor performance

provide support services where necessary

counsel individuals who continue to perform below expectations and implement the disciplinary process if necessary

terminate staff in accordance with legal and organisational requirements where serious misconduct occurs or ongoing poor performance continues.


Student Workbook Section 4 – Manage Follow Up

Plan performance improvement and development

To promote the development of individual employees, in the context of performance management, you will need to support the personal development planning process. Personal development plans (PDPs) should be created by managers in consultation with their employees, taking into consideration:

● the performance appraisal outcomes

● competency evaluation/skills audits/training needs analysis

● succession planning

● employee-initiated requests

● 360° feedback, if available.

The objective of the personal development plan is to either improve performance in the existing role or to improve competence to ensure the employee can be considered for future roles.

The plan includes several key sections:

● personal and professional goals

● individual strengths and weaknesses

● action planning to address skills gaps and achieve development goals.

Let’s look at some key issues in personal development planning.

Building competency for roles As a manager, you might develop a PDP for employees wishing to advance their careers or as part of succession planning.

To use performance development planning in this way, you will need to consider competencies and standards for performance for the roles aspired to. This will help you undertake a training needs analysis (TNA), as discussed in Section 2, to determine skills gaps and possible development options.

In considering the competence improvement required for existing roles and future roles, a competency framework, or competency rubric, is a useful tool. Competency profiles developed for each role are used for comparison with the competency of the individual to determine competency gaps to be closed by the personal development plan.



Consider the following example.

Example: Building competency

For example, Pat has an employee in the sales team who aspires to the role of Sales Team Leader. The role has the following profile.

Example: Office-based sales team leader (level 4)

Competency 1 2 3 4 5

Relationship-building

Selling and negotiating

Coaching, training and development

Analysis/problem-solving

Customer value proposition

Business awareness

Market awareness

Customer management

Results orientation

Working in/leading teams

Managing performance – self/team

Entrepreneurship

Some key competency areas require a level 4 proficiency to carry out the role of team leader effectively. The employee’s competency profile shows that that she has a level 3 competency in all areas.

The key areas for development are:

● relationship-building

● analysis/problem solving

● business awareness

● results orientation

● working in/leading teams.

Pat and the employee agree on undertaking a Certificate IV in Leadership and Management at the beginning of the next quarter. This commitment is marked in the employee’s PDP.

Consultation and collaboration Remember that, as much as possible, personal development planning is carried out by managers and individuals in consultation and collaboration with one another. Importantly, personal development plans describe the actions that people intend to take to develop themselves. In other words, personal development planning is something done by individuals, for their professional benefit, in the context of the organisation, and with the support of management.



Living documents A PDP should be a living document that employees should take personal responsibility for maintaining with the support and collaboration of managers.

In many organisations and institutions, having a PDP is a mandatory requirement for employees and members. Maintaining a PDP ensures that evidence of professional development is kept and can be used to demonstrate adherence to the principles of continuous improvement.

Remember that, to keep performance management on track, you will need to ensure regular monitoring of personal development against plans. Keep written records of PDPs in accordance with recordkeeping and organisational HR policies and procedures.

An example Personal Development Plan template is provided in Appendix 10.

Learning activity: Learning and development plans

Meet with an employee or colleague. Together, complete the following:

1. Discuss career aspirations or a particular desired role.

2. Establish the roles requirements and standards of performance.

3. Establish competency gaps.

4. Discuss training or development options.

5. Decide on appropriate options.

6. Complete a PDP.

Seek assistance

When undertaking performance management and development of individual staff members, you may need to seek advice on a variety of issues. These include:

● policies and procedures for performance management

● development options

● rewards and recognition options

● advice for conducting counselling sessions, disciplinary meetings or terminating employees

● legal advice.

You will first need to identify sources of information and expert advice. Information sources may be internal to the organisation or external.



Internal sources Sources of information or advice relevant to performance management may include:

● organisational documentation, for example, strategic plans, business plans, operational plans, policies and procedures, and codes of ethics

● training records

● HR information, often available through organisational recordkeeping software and human resources management (HRM) systems

● performance scorecards

● HR managers or business partners

● your immediate manager or supervisor

● the organisation’s legal team.

External sources External information sources may include, for example:

● private HR consultancies

● industrial relations lawyers

● national or state and territory regulatory bodies, for example, the Fair Work commission, or the Victorian WorkCover Authority (VWA)

● industry bodies and HR networks

● unions.

Once you have determined the available information sources, you will be in a position to select an appropriate source of expertise.

Learning activity: Seek assistance from internal and external specialists

Consider you are a manager responsible for performance managing individuals in your team for your organisation. For each of the following areas, note where you would turn for advice or information.

● recordkeeping requirements



● effective performance management

● conducting appraisals, counselling sessions or disciplinary meetings

● unfair dismissal laws

Reinforce excellence

There are two main ways in which high performance is rewarded to ensure continued high performance and fair remuneration:

● financial rewards

● non-financial rewards and recognition schemes.

Organisations may use each of these approaches effectively. It is important to remember that each approach works in different ways and may have different aims. Let’s look at each approach in more detail.



Financial remuneration Financial remuneration includes:

● regular pay or salary

● at-risk portions of pay packages or bonuses

● performance-based pay and commissions

● allowances, such as cars or training

● commissions.

Financial remuneration may be directly or indirectly linked to performance or particular aspects of performance. While financial remuneration can be effective and recognises people’s need for fair compensation for the value they contribute to organisations, it is important to recognise that people perform for reasons other than financial gain. Therefore, giving people more money may not actually improve performance, particularly in areas that require interpersonal skills and human interaction. Social skills may need to be rewarded with social rewards.

Note: Bonus schemes

Most bonus schemes work for the first year or two of operation but rapidly become ineffective at driving desired behaviours and can even become a negative influence.

Read the following article for further information on bonus schemes:

● ‘Recognising a turkey of a reward’, Change factory, viewed December 2014, <http://www.changefactory.com.au/our-thinking/articles/recognising-a-turkey-of-a-reward/>.

Recognise and reward success Bonuses and financial incentives can be effective in some areas of success, but if your goal is to build a positive emotional or social climate or good customer relationship building skills, they may be counter-productive. Susan Heathfield, a human resources expert suggests the following guidelines for recognising success:14

● Decide your goals for recognition. What do you want to achieve: Better performance? Encouragement and positive reinforcement? Improved climate and sense of recognition?

● Plan recognition activities that promote behaviours that drive the achievement of those goals. If, for example, you want to promote team-building, reward self-regulation, motivation and the display of social skills, you should avoid activities that undermine your message. For example, rewarding positive social behaviour with impersonal cards or gifts sends a negative message about what the organisation and its leaders really value.

14 Adapted from: S. Heathfield, ‘The power of positive employee recognition’, About money, viewed December 2014, <http://humanresources.about.com/od/rewardrecognition/a/recognition_ten.htm>.



● Be fair. Set guidelines for what to reward and how. Employee-of-the-month type programs often fail because they are perceived as inconsistently judged or popularity contests.

● Be inconsistent. Don’t always recognise in the same way or your attempts at non-monetary recognition will become another form of entitlement.

● Be specific about what the reward or recognition is for.

● Be timely. Offer rewards and recognition as soon as possible after the behaviour or achievement you want to recognise.

Think carefully about your performance goals and attempt to match those goals to rewards and recognition schemes that are most likely to drive performance.

Learning activity: Rewards and recognition

Read the following article:

● ‘Compensation methods; the pros and cons’, Change factory, viewed December 2014, <http://www.changefactory.com.au/our-thinking/articles/compensation-methods-the-pros-and-cons/>.


● What are the main options for compensating employees for high performance and desired behaviours?

● How do you decide on the best rewards and recognition scheme to match the circumstances?



● What are the advantages of salary as an incentive?

● What is the most popular scheme and what problems exist with it?

● What are the pros and cons of commission structures?

● What is a ‘salary plus pool’ system and why does the author recommend it?

● What variations of the pool system are available?



Manage poor performance

It is important to take immediate and strategic action to remedy poor performance. In other words, you will need to act in a fast enough timeframe to address the problem before it gets worse. You will also need to understand the overall purpose of performance management, legal and ethical constraints, and the most effective ways to bridge performance gaps in the interests of the organisation.

You will need to intervene in cases of underperformance in accordance with organisational policy and legal requirements. In this topic, we will look at best practice in managing underperformance, types of interventions aimed at improving performance and supporting employees, and ensuring appropriate recordkeeping.

Consider the six key elements in effective interventions.

Tip: Six key elements in early intervention

1. Clear policy or guidelines on supporting employees exhibiting early warning signs of not coping at work.

2. Line manager awareness of the early warning signs and how to respond appropriately (achieved through training, policy and guidance material).

3. Early contact with the employee to offer assistance.

4. Early and expert assessment to identify employee needs.

5. Employee and supervisor involvement in developing an agreed plan to enable the employee to deal with any identified problems.

6. Flexible workplace solutions to support the individual at work.

Best practice As a manager responsible for performance managing employees, you should attempt to implement best practice. Best practice in managing underperformance may be summarised as comprising management training, taking prompt action, and providing continuous feedback and a supportive culture of open discussion about performance.15

Tip: Best practice guide for managing underperformance

The Fair Work Ombudsman provides the following online best practice guide to managing underperformance:


15 Fair Work Ombudsman, 2013, Best practice guide: Managing underperformance, available online, viewed December 2014, Fair Work Ombudsman, <http://www.fairwork.gov.au/BestPracticeGuides/09-Managing-underperformance.pdf>.



Learning activity: Managing underperformance

Review the Fair Work Ombudsman’s guide to best practice for managing underperformance:



● What is underperformance?

● What are the causes of underperformance?

● How do you manage underperformance?



● What can be done if managers lack skills to manage underperformance?

Types of interventions To manage underperformance, you can undertake a number of interventions to both address underperformance and support employees to perform. These include:

● education

● sponsorship

● providing feedback

● counselling

● confronting.

These types of interventions are not exclusive and can potentially be combined in a program of performance management. The types may occur in an intervention in the order listed above or may not. Let’s look at the types of interventions in more detail.

Education Education means identifying the need for knowledge or skills and then providing it directly, or providing the means for learners to access knowledge or skills by themselves. Classroom-based training may be the most well-known form of workplace education. Educating employees can also take several on-the-job forms, including providing checklists, work instructions, online help, mentoring, buddying and coaching.

On-the-job group learning or communities of practice are also increasingly popular ways in which organisations promote performance by encouraging employees to learn from one another or from more senior members of the team or workforce. Communities of practice promote high performance by recognising an essential social component to work and learning in practice.



Learning activity: Communities of practise

Read the following article:

● J. Pesci, 2011, ‘Designing for communities of practice’, GenslerOnWork, viewed December 2014, <http://www.gensleron.com/work/2011/7/21/designing-for-communities-of-practice.html>.


● What are communities of practice?

● Are they a new phenomenon in vocational education?

● Why are large organisations looking at harnessing communities of practice to improve performance and maintain high performance?

● How does a community of practice work to improve individual performance?



● What do you think is more relevant to your organisation: people individually solving their own problems to perform better at work or teams sharing information and insight to improve both individual and team performance?

● How do communities of practice promote autonomy and personal responsibility for work?

● Does a community of practice exist in your workplace?

● If a community of practice exists in your organisation, is it based one work location or is it distributed across many locations, facilitated by online tools such as forums, project management software or shared knowledge management systems?



● How could you deploy a community of practice (or take advantage of an already existing informal community) to promote high performance in your organisation?

Another educational option for promoting is called action learning. Action learning is highly compatible with the performance management cycle in that it involves actually setting real work or business problem-solving tasks for individuals and teams, regularly monitoring progress and regularly providing feedback. Learners learn by asking questions and reflecting on performance in order to apply insights gained from previous practice to future work. The only real differences between action learning and regular work reside in that action learning: involves rapid, recursive cycles of planning, performance, monitoring, reflection and intervention; may involve the key role of a coach to facilitate problem-solving and reflection; and it is focused on particular key skills seen to drive overall competency for teams and individual roles.

Providing educational support does not always mean taking employees off-the-job and putting them into training rooms. Doing this may not be a cost-effective way of building skills. You may need to consider methods and tools that may be more effective and more easily integrated into performance management systems.

Learning activity: Education options

Brainstorm or research different means of transferring knowledge or skills from one person to another. Start with the list provided and see how many different forms of education and tools of education you can list.

Forms of education Tools Usefulness for supporting individuals to perform

Coaching checklists

work instructions

online help

Communities of practice



Forms of education Tools Usefulness for supporting individuals to perform

Action learning

Classroom learning

Self-paced learning

Self-paced e-learning

Webinars (synchronous e-learning)

Sponsorship In sponsoring an overachieving employee, you as a manager are entering into a kind of mentoring relationship with the employee, a relationship in which you provide performance or career advice to a less-senior or less-skilled individual.

Sponsoring, however, is more than mentoring. It includes putting employees in situations where they can be stretched to find the boundaries of performance for their current behaviour, skills, and knowledge set. A sponsored individual is also one you will have a professional or work-related stake in. An example of sponsoring would be to put a highly performing employee on an important cross-functional project team so that they can learn from the more-experienced employees performing different functions.

Providing feedback and encouragement Giving effective feedback requires providing information on performance when and how it is most likely to be useful.

When a specific problem occurs, or when you’d like to reinforce desired behaviour, it is best to give the feedback as soon as possible after the behaviour is demonstrated.



Remember that all employees need regular positive and constructive feedback to adjust and improve their performance. Positive feedback is best used when an employee is doing well, and you are trying to reinforce and encourage a particular behaviour or result from your employee.

The process for giving positive feedback is:

1. Identify the specific behaviour.

2. Describe the behaviour’s positive impact.

3. Look for ways to build on the behaviour.

4. Encourage the employee to share his or her views.

Negative feedback should be clear and constructive. It should be straightforward and honest in order to enable the employee to identify and correct the underperformance or its root cause. Negative feedback should be constructive in that it guides the employee towards concrete and realistic actions to improve performance. Take care to provide feedback in manageable chunks. Too much negative feedback can be overwhelming and have the effect of discouraging the employee from taking positive action.

The process for giving negative feedback mirrors that for giving positive feedback:

1. Identify the specific behaviour.

2. Describe the behaviour’s negative impact on performance or on the performance of others.

3. Look for ways to correct the behaviour or improve performance.

4. Encourage the employee to share his or her views.

Counselling If an employee is working at an unacceptable level, managers often have little option but to counsel the employee.

In these situations it’s important to be specific and focus attention on the cause of the problem and not personalities. Remember that the aim is to guide the employee to improve their performance, or correct any inappropriate behaviour, and not to simply punish them.

Nonetheless, employees need to know that their current performance is not meeting expectations and you are giving them a chance to improve. Reinforce your performance expectations and get confirmation that the employee understands those expectations.

An example of a record of counselling template is provided in Appendix 11.

The next topic in this section will look at counselling in more detail.

Confrontation or undertaking disciplinary processes It is important to make a distinction between counselling and confronting employees about performance. The major difference is that in counselling, the manager and the employee work together to solve a common problem. It is understood that the employee is potentially willing and able to perform, but needs help. For example, lack of training, experience or understanding of role requirements may be hampering the individual. In addition, environmental factors may be contributing to the employee’s performance.



When an individual’s performance does not improve, or there is an unwillingness to comply, or there is a serious breach of behavioural standards, you must be prepared to confront the employee and the focus then switches to the employee solving the problem about their behaviour. The responsibility shifts from being held jointly by employee and manager to being held only by the employee. You may need to take more serious actions if the employee doesn’t improve.

The disciplinary options range in terms of their severity:

● oral warning

● written warning

● suspension without pay

● reduction of pay

● demotion to lesser duties

● termination.

You may give oral and written warnings in the counselling phase. You will mostly use the other options only in the confronting phase. An example of a written warning letter template is provided in Appendix 12.

Later on in this section we will explore disciplinary processes in more detail.

Interventions summary Intervention aims to assist employees by supporting them through areas of their job with which they are struggling. Choosing the best form of intervention should be based on an employee’s performance and behaviour and will also depend on the nature of the performance or behaviour, the context in which it occurs, and the willingness and ability of the employee to take appropriate actions to improve their performance.

Line managers require a variety of skills to respond with an appropriate intervention. The interventions required, the circumstances in which they should be used and the performance management skills required by managers and coaches are summarised in the intervention matrix below.

Intervention required

When to use Desired outcome Skill required

Educate

New employees Develop new knowledge and skills

Communication skills

Experienced employees in new roles

Increase confidence and ability

Demonstration skills

New work processes or equipment

Pass on knowledge Training needs analysis skills

Sponsor Outstanding performers

Recognise the employee

Ability to release control

Hone a skill Mentoring





Test a skill in a new environment

Removing barriers to performance and progression

Encourage

When simple corrections are required

Increase confidence Active listening

Recognising and affirming good performance or behaviour

Improve skill Providing constructive feedback

When employees are trying a new skill

Improve performance or behaviour

Providing constructive feedback

Counsel

When performance or behaviour is below what is expected

Improve performance or behaviour

Active listening

Providing constructive feedback

Responding to setbacks in attempts to improve performance or behaviour

Establish trust Rapport building

Renew joint commitment to find and affect a solution

Problem-solving

Open up communication

Active listening

Confront

When performance or behaviour issues are acute

Change behaviour Active listening

When poor performance or behaviour is chronic and unresolved despite counselling

Transfer ownership of the problem to the employee

Firmness


When privacy can be assured

Establish mutual understanding of the problem, its cause and consequences of inaction

Rapport and trust building






When emotions are cooled down

Potentially redeploy or terminate

Ability to confront facts, reality


Critical thinking

Note that the approach you take to performance managing underperforming employees requires them to be both willing and able to improve. The shortfalls in performance may show themselves in two ways:

● an employee’s ability to perform or behave in accordance with company policy and standards and their specific job requirements

● an employee’s willingness to perform or behave in accordance with company policy and standards and their specific job requirements.

The appropriate intervention for employees who exhibit different ability and willingness is depicted below in the following matrix.

Ensure appropriate recordkeeping for interventions There are three components of a performance management system relevant to performance management interventions, which must be documented and stored in compliance with an organisation’s policy and system for document management. They are:

● formal performance reviews

● learning and development plans

● training records and results

● counselling, disciplinary and termination records.

Educate and encourage Confront

Able

Willing

Counsel and then confront if no improvement

Sponsor

No

Yes

No

Yes



Learning and development plans should include:

● employee name and location

● current competence level

● competence improvement required

● anticipated career options

● suggested learning interventions and timeframes.

Employee attendance at formal interventions should be recorded; for example, in their personnel file.

The results of interventions, including any performance assessments, should be recorded in the employee’s personnel file and in the file of the intervention service provider whether external or internal.

As discussed previously, records should be stored securely and in accordance with internal business needs and external legal requirements.

Learning activity: Provide support

Consider an occasion when you needed to improve the performance of an employee and answer the following questions:

● What methods of intervention or support were available to you?

● What method of intervention did you use?

● Was it effective?



● Why was it effective or ineffective?

● What would you do differently today?

Counsel and discipline individuals

From time to time, you may need to conduct counselling or disciplinary processes as part of an intervention to remedy a performance issue. In this section, we will explore a typical counselling process.

Tip: counselling

When undertaking counselling, make sure that:

● it is conducted in a private location

● it is scheduled and the employee has prior knowledge that it will occur

● the employee is notified that they are to be counselled

● the employee is aware of what may be involved in the counselling

● you check with HR records to confirm: processes, any previous counselling of the employee that has occurred, and action to be taken if counselling is unsuccessful

● you check that the employee is aware of the performance standards expected of them, and the standards that have not been met

● you are aware of factual evidence that demonstrates the employee’s underperformance rather than just other employees’ opinions.

Let’s explore the process of undertaking a counselling session.



Counselling process To undertake counselling with an employee, you should:

1. Define the nature

of the problem

2. Ask employee to provide reasons for the behaviour

3. Determine action

required

4. Agree on an

improvement plan with the employee

1. Define the nature of the problem The first step is the most critical, because it sets the tone of the meeting and explains what is going on. It is also often the most difficult step for both managers and the employee. The problem or performance issue needs to be defined very clearly and specifically. You will need to back up your understanding of the issue with data, for example, recorded evidence or your own observations. If for example, there has been an allegation of misconduct, and it is not sufficiently backed up with hard evidence, explain that it is an allegation that needs to be investigated. Review any written standards of performance with the employee to be sure that they are clear.

Once you have explained exactly what the problem is, describe the impact – on both the organisation and on individuals – of the problem or issue. Let the person know the consequences of the problem or issue continuing.

Finally, explain what you want to achieve from this meeting. This may be as simple as hearing the employee’s comments and doing some further investigation to agreeing on a plan to resolve the problem.

Here is an example of how this step can be conducted:

Amanda, I have asked you to come and see me today about your continued late attendance. Over the past week, I have observed that you have been up to 15 minutes late for work on five out of six days. By you turning up late to work, the opening procedures are delayed and the impact is that your team mates have to make up for what you are not completing. If this behaviour continues, you are in jeopardy of being dismissed; so, to avoid that, I would like to spend this session coming up with a plan on how we can get you to make it to work on time.

2. Ask for reasons for the problem In this step you are trying to find out the reason for the issue or problem. This step requires you to provide the employee with every opportunity to respond and explain what is happening. Make sure that you allow the employee enough time to respond to the issue.

During this stage, you should ask open questions so that you receive as much information as possible and use active listening skills to ensure that you accurately understand what is being said. You should also take detailed notes so that you can a) ensure you understand the employee correctly and b) if the issue needs to be followed up, you have a record of what was said.

Find out if there are reasons for the issue and if something outside work influenced the problem’s occurrence.



At the completion of this stage you need to both reach agreement on what the problem or issue is and what the reasons for the problem are. In rare cases where the situation is very serious, the employee may need to be suspended from work until an investigation is completed. This would need to occur if the employee’s presence at work could pose a threat to the safety of others, or if the employee may take actions to cause harm to the reputation or property of the organisation. If this is the case, then discuss your issue with more senior employees and the organisation may need to seek expert advice about legal and health and safety implications of suspension or failing to suspend an employee in certain circumstances.


Amanda, given that you are aware that your start time is 8.30 am each morning, what are the reasons for your late attendance?

OK, so we both agree that you have been late for work and you are saying that the reason for your late attendance is that you are finding it difficult to get your family up and out of the house in time for you to get to work. Is that right?

3. Determine the action required On gaining all the facts from the employee, sometimes you may need to schedule another meeting so that you can consider options or investigate further. However, if you have enough of the facts, you can begin discussing appropriate actions with the employee.

In this stage, you should reiterate what the problem is and why it is considered serious, the expected standards that you are asking the person to achieve and the consequences of not meeting those standards.

If you are going to terminate the individual’s employment, then this should be stated when discussing consequences.

4. Agree on an improvement plan Finally, you need to assist the employee to come up with an agreed plan of action to help them achieve the expected standards. You should discuss and select options that best fit the employee’s needs, job role, and learning style. The best way to agree on the actions to take is to involve the employee in making decisions about the best course of action.

At this point, you should make efforts to build the employee’s self-esteem. Management of underperformance can be discouraging for an employee and so it is critical to encourage and demonstrate your support of the employee. Acknowledge their commitment and cooperation in coming to a resolution.

Once actions have been agreed upon, you need to discuss how achievement of the target will be assessed and work out follow-up dates and times.


Amanda, I’m sure that the plan that we’ve put in place will be able to rectify the problem, we will review the plan together in a week to see how you are progressing with it and if you still have any issues. I am confident that we will be able to put this behind and move on, so if you need or want to chat, or if you think of any other ways that we can work towards it, then please come and see me.



The disciplinary meeting If other methods, such as counselling, warning, or coaching have been ineffective, and in cases of serious misconduct or apparent unwillingness to improve performance, you may need to hold a formal disciplinary meeting to confront employees. You will need to consider legal issues around disciplinary procedures, (particularly to do with unfair dismissal), such as the Fair Work Act.

You will also need to consider who will attend. Disciplinary meetings may require attendance by a:

● union representative

● legal representative

● HR department

● witness.

You will also need to consider your overall approach. Consider the following tips:

Tips for holding disciplinary meetings

Consider the following tips for disciplinary meetings:

Enlist the help of your human resources team or senior managers to assist you in the meeting.

Allow the employee to bring a support person to the meeting (such as a union representative or co-worker).

The process begins with a formal letter and/or email to the employee notifying them that they will be required to attend a disciplinary meeting and that they may organise a support person to attend if they wish.

When the meeting begins, work towards cooperation, NOT confrontation.

The discussion should focus on telling the employee exactly what must be done to bring their performance up to an acceptable level. This should be done by discussing specific examples of performance issues that have occurred and suggesting ways that performance can be improved.

State the performance expectations and seek a confirmation from the employee that they understand these expectations.

Make a dated note to document the matters that have been discussed and any assistance offered.

It is important to ensure disciplinary meetings have clear objectives. Objectives may include, for example:

● the employee recognises their own poor performance

● the employee takes responsibility and undertakes to improve.



During the meeting, it’s important to be specific and focus attention on the cause of problem and not on personalities. Remember that the aim is to guide the employee to improve their performance or correct any inappropriate behaviour and not to punish them. Nonetheless, employees need to know that their current performance is not meeting expectations. Reinforce your performance expectations and get confirmation that the employee understands those expectations.

Actions and outcomes If the outcome of the disciplinary meeting is positive, i.e. the objectives for the meeting are achieved, then you may need to ensure that you put in place:

● agreed steps to improve

● careful monitoring

● employee assistance programs.

However, you may need to take more serious actions if the employee subsequently doesn’t improve their performance. The disciplinary options range in terms of their severity:

● verbal warning

● written warning

● suspension without pay

● reduction of pay

● demotion to lesser duties

● dismissal.

Note that before you initiate any of these actions, you should ensure that any actions you take are fair to the employee as well as fair and safe for other employees in the workplace.

Learning activity: Counselling/disciplining

Consider your organisation or an organisation you would like to research. If you need an example organisation, try IBSA simulated businesses, including Australian Hardware and CoffeeVille at <http://simulations.ibsa.org.au/>.


● What counselling or disciplinary processes exist?



● How would you improve performance management processes to ensure counselling was undertaken in the most effective way?

Dismiss staff in accordance with legal requirements

In extreme cases, you may have no other choice but to terminate an employee’s employment. If it comes down to dismissing an employee due to performance issues, the law requires that the employee is first given adequate warning of their unsatisfactory performance and given opportunities to improve.16 Standard practice is to give staff up to three written warnings to improve their performance. Written warnings will provide sufficient documentation of the employee’s performance issues, the steps taken to improve them and the outcomes that resulted from these steps.

This type of written evidence can be critical if the situation escalates and moves into, for example, formal arbitration; for example, through the Fair Work Commission, the national workplace relations tribunal.

A written warning template is provided in Appendix 12.

Termination process Termination processes are usually a five-step process or variations of a five-step process, comprising:

1. Verbal counselling about poor behaviour or poor performance with a verbal agreement on what actions needed to be taken by both parties to improve performance or behaviour. A file note may be kept.

2. Feedback and counselling on the actions taken or not taken with a further agreement on actions to be taken if the poor performance or poor behaviour is not corrected. A note is written containing what actions are to be taken by both parties to improve performance or behaviour and is signed by both parties.

3. Feedback and counselling on the actions taken or not taken with a further agreement on actions to be taken if the (what now appears to be) chronic poor performance or poor behaviour is not corrected. A clear indication is given that if the poor behaviour or performance is not corrected there may be serious consequences, such as redeployment or termination. A written note outlines the actions both parties will take to improve performance/behaviour and is signed by both parties.

16 D. Tovey and M.-A. Uren, 2006, Managing performance improvement, Pearson Australia, p. 265.



4. Feedback and confrontation on the issues that remain unresolved is given. An agreement is sought from the employee regarding what they will do to resolve the within a specified timeframe or face redeployment or termination. A written note is made of what actions the employee will take to improve performance or behaviour and signed by both parties and, potentially, HR or a senior manager.

5. Feedback on the failure to resolve the issues is made and the redeployment or termination is made.

Unfair dismissal The Australian Government Fair Work Ombudsman maintains that an employee has been unfairly dismissed when the dismissal was harsh, unjust or unreasonable and is not a case of genuine redundancy.

Note that, if the employer is a small business and employs less than 15 full-time employees or equivalent, they should follow the Small Business Fair Dismissal Code when dismissing an employee.

The Fair Work Ombudsman considers the following points when determining if an employee has been unfairly dismissed.

● Is there a valid reason for the dismissal that relates to the employee’s conduct or ability to do their job?

● Was the employee notified of the reason for their dismissal and given an opportunity to respond?

● In cases of unsatisfactory performance, was the employee warned about it before the dismissal?

The Fair Work Ombudsman does advise that employers have the right to summarily dismiss an employee for serious misconduct.

Note: Summary dismissal

While it is important to always be fair to an employee, there are circumstances in which summary dismissal is justified. Summary dismissal is the dismissal of an employee without notice or warning. Summary dismissal is only justified when the employer has reasonable grounds to determine that the employee’s behaviour is ‘serious misconduct’. According to the Fair Work Ombudsman website, serious misconduct includes theft, fraud, violence and serious breaches of work health and safety procedures. To be deemed fair, it is sufficient, though not essential, that an allegation of theft, fraud or violence be reported to the police.17

17 Fair Work Ombudsman, 2014, ‘Termination of employment fact sheet’, Fair Work Ombudsman, viewed December 2014, <http://www.fairwork.gov.au/ArticleDocuments/723/Ending-Employment-Fact-Sheet.pdf.aspx>.



Learning activity: Termination: Fair Work Act compliance

Effective industrial relations policies can assist an organisation to comply with fair work legislation when terminating staff. Policy examples include a redundancy policy and a performance management policy.

Locate your organisation’s policies and procedures for redundancy, termination or performance management. Alternatively, use the internet to find an example of each.

Fill out the table below, outlining how these policies ensure an organisation’s compliance with the Fair Work Act when terminating an employee.

Note that performance management and disciplinary policies for the Australian Hardware Wollongong Store are available from the IBSA simulated business website at: <http://simulations.ibsa.org.au/australian_hardware/secure/documents.php>.

Policy How does this policy assist the organisation to comply with fair work legislation?

Termination

Redundancy policy

Performance management policy



Section summary

This section provided information on planning employee development; seeking assistance from internal and external sources of advice; rewards and recognition; and managing poor performance and termination in accordance with relevant organisational policy and legislative requirements. You should now understand how to manage follow-up activities to performance management.

Further reading

● Armstrong, M., 2006, ‘Chapters 9–16’, Performance management: key strategies and practical guidelines, 3rd edn, Kogan Page, London.


● Change factory, n.d., ‘Compensation methods; the pros and cons’, Change factory, viewed December 2014, <http://www.changefactory.com.au/our-thinking/articles/compensation-methods-the-pros-and-cons/>.

● Change factory, n.d., ‘Recognising a turkey of a reward’, Change factory, viewed December 2014, <http://www.changefactory.com.au/our-thinking/articles/recognising-a-turkey-of-a-reward/>.


● Fair Work Ombudsman, n.d., ‘Unfair dismissal’, Fair Work Ombudsman, viewed December 2014, <http://www.fairwork.gov.au/ending-employment/unfair-dismissal>.

● Pesci, J., 2011, ‘Designing for communities of practice’, GenslerOnWork, viewed December 2014, <http://www.gensleron.com/work/2011/7/21/designing-for-communities-of-practice.html>.

● Standards Australia, 2002, AS ISO 15489.1-2002 Records management – general, Standards Australia, Sydney.

● Tovey, M., Uren, M.-A. L., and Sheldon, N. E., 2010, ‘Chapters 10–12’, Managing performance improvement, 3rd edn, Pearson Australia, Frenchs Forest, NSW.

● Wenger, E., McDermott, R. and Snyder, W. M., 2002, Cultivating communities of practice: a guide to managing knowledge, Boston, Harvard Business School Publishing.



Section checklist


write and agree on performance improvement and development plans in accordance with organisational policies

seek assistance from human resources specialists, where appropriate

reinforce excellence in performance through recognition and continuous feedback

monitor and coach individuals with poor performance

provide support services where necessary

counsel individuals who continue to perform below expectations and implement the disciplinary process if necessary

terminate staff in accordance with legal and organisational requirements where serious misconduct occurs or ongoing poor performance continues.


Student Workbook Glossary

Glossary

Term Definition

Accredited training

Training that leads to a formal qualification, such as a Certificate, Diploma or Advanced Diploma. In Australia, these qualifications are recognised Australia-wide and are underpinned by common standards and assessment guidelines.

Balanced scorecard

A method of using KPIs and targets to measure and present performance information for an organisation. The scorecard measures organisational performance across several perspectives: financial, customers, internal business processes, and learning and growth.

Capability Capability may be used as a synonym for competence when applied to individuals; however, it is often used in the context of discussing the potential of a workforce for implementing strategic directions. Unlike competence, capability can apply to organisations as a whole.

Competency/ competencies

A competency is the ability to perform a job role or function to a desired standard or level of proficiency. A job role or function may require the demonstration of a range of competencies. Competencies can include demonstration of knowledge, skills and behaviours.

Continuous improvement

Continuous improvement is a systematic approach to making things better. It involves making constant, small changes that improve a task, process or system.

Integration Horizontal integration: ensuring that all policies and processes that exist for a single level of the organisation (such as a single team or department) are developed so that they complement and inform each other.

Vertical integration: ensuring that policies and processes at every level of the organisation (such as at a senior management level and a team level) are all informed and influenced by the work requirements and individuals at every level.

Key performance indicators (KPI)

Performance measures that focus on achieving results that are seen as critical to the success of the organisation.


Glossary Student Workbook

Term Definition

Learning styles Learning styles refer to the different styles adopted by individuals to learn knowledge and/or skills.

A number of theories of learning styles claim that learners learn better when information is presented to them in specific ways. For example, some learners are said to learn better when information is presented to them visually; other learners are said to learn better through hearing information. Although many of the claims of increased learning associated with matching individual learning styles to teaching methods remain unproven, many trainers apply some form of learning style theory – some for the sake of variety; some for the sake of stimulating learners – to vary their presentation methods.

Line manager A line manager is a person who is directly responsible for managing the output (work) of an individual or team. A line manager would commonly be responsible for allocating tasks, scheduling deadlines, monitoring work and reviewing individual and/or team performance.

Non-accredited training

Training that does not lead to gaining a formal qualification. Non-accredited training is usually used to give employees/ learners specific knowledge or skills that they require for their day-to-day work. Non-accredited training can be more efficient and cost-effective method of training employees because it can focus on the specific gaps in employees’ knowledge, rather than covering all the material and administering assessments required for gaining qualifications.

Performance appraisal

A formal review of employee performance. Also known as a performance review.

Performance management

A management system to boost employee performance and the productivity of the organisation.

Performance Management System (PMS)

A management system for performance that encompasses setting performance goals, creating performance standards, monitoring performance, rewarding excellence in performance and working towards continuous improvement.

Self-appraisal Employees provide feedback on their own performance.

Stakeholders All those people who have an interest in a task or system you are completing or modifying. These may include customers, partners, employees, shareholders, owners, government, and regulators.

360º review A performance management appraisal technique that draws feedback from a variety of separate perspectives.


Student Workbook Appendices

Appendices

Appendix 1: Integrated performance management system

Reproduced courtesy of the Change Factory <http://www.changefactory.com.au>.


Appendices Student Workbook

Appendix 2: Example of a position description template

Position Description

Job title: Date:

Job level: Reports to:

Department/division:

Summary of position Describe the position briefly. This information will be used for internal and external job advertisements.

Essential job requirements List the position’s essential job tasks. State what is done and to what standard.

Required competence/education

What are the minimum competence/educational requirements for this position?

Competence Level

Product knowledge Accomplished

Up-sell and cross –sell Exemplary

Health, safety, security and environment Exemplary

Superior service Exemplary

Equipment maintenance Accomplished

Interacting with customers Exemplary

Education Level

Training and assessment Certificate IV

Physical requirements List physical job requirements for this position. For example, ‘must be able to lift 50 pounds’, ‘must be able to drive a car’, ‘must stand for seven hours a day’.

Mental requirements List the mental demands of the position. For example, ‘must be able to do simple maths’ or ‘must be able to carry out complex written instructions’.



Equipment used List the kinds of equipment used in this position. For example, computer, telephone, forklift, fax machine, or power tools.

Supervisory responsibilities List the number of people supervised, along with their job titles, if applicable.

Working conditions List examples of the typical working conditions for this position. For example, ‘works primarily outdoors’, ‘works in cold temperatures XX% of the time’, or ‘exposure to chemicals’.

Signature: _______________________________________________________________

Date: ___________________________________________________________________

Checklist for completing the effort/environment factors of a job description Use this checklist to help complete the physical and mental requirements of the job. Only fill in the job description heading if the level of effort required or environmental factors are a significant part of what the job is.

Physical effort

Number of hours/days

N/A 1–2 3–4 5–6 7+

1. Sitting

2. Standing

3. Walking

4. Bending over

5. Crawling

6. Climbing

7. Reaching overhead

8. Crouching

9. Kneeling

10. Balancing

11. Pushing or pulling



Physical effort


N/A 1–2 3–4 5–6 7+

12. Lifting or carrying:

a. 5 kilograms or less

b. 5 to 10 kilograms

c. 10 to 16 kilograms

d. 16 kilograms or more

13. Repetitive use of hands/arms

14. Repetitive use of legs

15. Hand/eye coordination

Physical effort Yes No

1. Driving cars, trucks, forklifts and other equipment

2. Being around scientific equipment and machinery

3. Walking on uneven ground

Mental effort


N/A 1–2 3–4 5–6 7+

1. Directing others

2. Writing

3. Using calculations

4. Talking

5. Working at various tempos

6. Concentrating amid distractions

7. Remembering names/details

8. Discriminating colours

9. Making decisions

10. Working rapidly



Environmental factors


N/A 1–2 3–4 5–6 7+

1. Inside

2. Outside

3. Humid

4. Hazards

5. High places

6. Hot

7. Cold

8. Noisy

9. Wet

10. Dirty/dusty



Appendix 3: Example of a risk management plan/risk register

Risk Risk Risk impact Controls Monitoring Timelines Responsible

Difficulty sourcing or training skilled and experienced staff.

Medium High Targeted advertising in trade magazines and online.

Promotional focus on training and development opportunities.

Regular training for existing staff.

Regular investigation of competitor wages, seeking to match or better if viable from a budgetary perspective.

Monthly and quarterly.

Human resources manager, store general managers and general operations managers.

Wastage or unsaleable stock from poor inventory maintenance and sales monitoring.

Medium High Continuous monitoring using in-house ERM system.

Daily contact with suppliers.

Daily automated monitoring (with alerts for issues) and anticipation of demand through ongoing research and analysis in consultation with market research consultants.

Daily monitoring.

Monthly and quarterly sales and demand analysis.

Store general managers, general operations managers, COO, and marketing general manager.



Appendix 4: Conducting an appraisal (sample procedure and template)

Performance appraisal instructions (If you are using this template to complete a performance appraisal, delete these instructions before filing the copy of the template.)

Step 1: Enter job performance requirements into template Fill in the job performance requirements (JPRs) in Section 1. Fill them in for both Part A (employee’s view) and Part B (manager’s view). The JPRs should be derived from the following areas:

● the employee’s job description document

● goals agreed at the employee’s previous appraisal

● any operational goals that have been discussed and agreed with the employee as being a job performance requirement.

Step 2: Employee self-appraisal Provide Section 1 Part A to the employee at least one week before the scheduled appraisal meeting.

The employee should appraise the quality of their own performance by assigning weightings to each job performance requirement, and ticking the box which matches their perceived performance. Ratings should be expressed as a percentage and should add up to 100% across all five JPRs.

Once the JPRs section is completed, the employee should assign themselves a rating out of 5 for their overall performance:

Rating Meaning Detail

1 Inadequate Consistently unable to do the job.

2 Needs training Needs additional training or other development to meet job requirements.

3 Good Met all job requirements and may exceed them at times.

4 Outstanding Regularly exceeds the requirements of the job.

5 Exceptional Far exceeds requirements and expectations.

For the remainder of the items in Section 1 Part B, the employee only needs to make comments and assign a rating.

The employee may make their own comments if they wish.



Step 3: Appraise employee Complete Section 1 Part B.

Assign a weighting to each job performance requirement (JPR), and tick the box which matches the employee’s performance. Ratings should be expressed as a percentage and should add up to 100% across all five JPRs. The relative weighting of the JPRs should be clear from the previous appraisal and from informal feedback and discussions between appraisals.

Once the JPRs section is completed, you should assign the employee a rating out of five for their overall performance:

Rating Meaning Detail

1 Inadequate Consistently unable to do the job.

2 Needs training Needs additional training or other development to meet job requirements.

3 Good Met all job requirements and may exceed them at times.

4 Outstanding Regularly exceeds the requirements of the job.

5 Exceptional Far exceeds requirements and expectations.

For the remainder of the items in Section 1 Part B, you need only to make comments and assign a rating.

All written comments should explain the factual basis of the rating in each category, including the overall appraisal.

You may add additional comments if you wish.

Step 4: Conduct appraisal of past performance Meet with the employee to discuss the appraisal. Discrepancies between the employee’s view and the manager’s view of performance should inform the beginning of a discussion about performance, seeking at first to eliminate misunderstandings about judgements.

Step 5: Set future plans Section 2 of the document concerns setting plans for the future including any developmental work appropriate to prepare the employee for career progress or remediate inadequate performance or perceptions (on behalf of the employee or the manager) of inadequate competence. Job performance requirements are also set for the next six months. It also includes a section for comment about the employee’s career desires and prospects.

Both the employee and the supervisor must remember an appraisal is a time for clarity and honesty about performance and competence and the development work required to allow an employee to fully reach the potential they desire and are able to reach. An appraisal should reinvigorate employees at all levels of performance to take the next step in improving their performance in an existing role or accepting a challenge in a new role.



Step 6: Obtain signatures and process appraisal Obtain the employee’s signature on the front of the appraisal form, then sign and date the form before forwarding it to your manager for approval and records storage.

Section 1: Evaluation of past performance

Part A: Employee’s view Please complete the following tables.

Evaluation of quality of work Evaluate the quality of your work.

Job performance requirements (JPRs) Ability to meet standards

Does not meet standards

Meets standards

Exceeds standards

JPR #1:

Weighting:

Comments:

JPR #2:

Weighting:

Comments:





Meets standards

Exceeds standards

JPR #3:

Weighting:

Comments:

JPR #4:

Weighting:

Comments:

JPR #5:

Weighting:

Comments:





Meets standards

Exceeds standards

Other factors contributing to overall evaluation:

Overall evaluation of quality of work


Meets standards

Exceeds standards

Quantity of work Do you meet deadlines and output expectations?

Comments:

Overall evaluation of quantity of work

Rating

1 2 3 4 5

Job knowledge Do you understand your duties? Do you have the required skills to execute your duties to Coral Cape Lodge standards?

Comments:

Overall evaluation of job knowledge

Rating

1 2 3 4 5



Initiative Do you begin and complete assignments on your own?

Comments:

Overall evaluation of initiative

Rating

1 2 3 4 5

Dependability Do you reliably complete assignments and responsibilities?

Comments:

Overall evaluation of dependability

Rating

1 2 3 4 5

Adaptability Do you accept and understand new methods and approaches?

Comments:

Overall evaluation of adaptability

Rating

1 2 3 4 5



Overall appraisal

Rating

1 2 3 4 5

Part B: Manager’s view Please complete the following tables.

Evaluation of quality of work Evaluate the quality of the employee’s work.



Meets standards

Exceeds standards

JPR #1:

Weighting:

Comments:

JPR #2:

Weighting:

Comments:





Meets standards

Exceeds standards

JPR #3:

Weighting:

Comments:

JPR #4:

Weighting:

Comments:

JPR #5:

Weighting:

Comments:





Meets standards

Exceeds standards

Other factors contributing to overall evaluation:

Overall evaluation of quality of work

Rating

1 2 3 4 5

Quantity of work Does the employee meet deadlines and output expectations?

Comments:

Overall evaluation of quantity of work

Rating

1 2 3 4 5

Job knowledge Does the employee understand your duties? Do they have the required skills to execute their duties to Coral Cape Lodge standards?

Comments:

Overall evaluation of job knowledge

Rating

1 2 3 4 5



Initiative Does the employee begin and complete assignments on their own?

Comments:

Overall evaluation of initiative

Rating

1 2 3 4 5

Dependability Does the employee reliably complete assignments and responsibilities?

Comments:

Overall evaluation of dependability

Rating

1 2 3 4 5

Adaptability Does the employee accept and understand new methods and approaches?

Comments:

Overall evaluation of adaptability

Rating

1 2 3 4 5



Overall appraisal

Rating

1 2 3 4 5

Section 2: Future performance and development

Goals for the next six months Set performance goals for the next six months

Goal Performance standard Review date

Suitability and desire for progression Yes No

Is the employee capable of further progression now?

Does the employee desire a career in hospitality?

Associate’s comments on career goals:



Manager’s comments on career goals:

Development areas to aid career progression

Development area Project/training Review date

Job performance requirements for the next six months Set job performance requirements for the next six months. These JPRs may be drawn from the employee’s job description or from any goals or development targets set in this appraisal. Refer back to this document when conducting the next appraisal.

JPR #1: Weighting:

JPR #2: Weighting:

JPR #3: Weighting:

JPR #4: Weighting:

JPR #5: Weighting:



Overall comments

Associate’s comments:

Manager’s comments:

Signatures and approvals

Employee name:

Employee department:

Reviewer:

Signatures

Appraisal completed

Employee Supervisor Date

Appraisal approved

Manager Date

Appraisal processed

HR Manager Date



Appendix 5: Skills audit/training needs analysis

Name: .....................................................................................................................................

Manager: ................................................................................................................................

Skills to be developed Training activity/method

Actual skill level

Desired skill level

Scheduled date/time

Team member has no proficiency.

Basic proficiency: Team member can’t perform task independently.

Working knowledge: Team member can perform task independently with supervision.

Can do/proficient: Team member can perform task independently.

Exemplary, role model: Team member can train others to perform task.



Definitions for proficiency levels A level of proficiency is a defined range of ability within a skill or competency.

Basic

proficiency

Performs own work with daily supervision by others, demonstrating:

● fundamental knowledge and applies this with coaching and supervision support

● performance impact limited to own work

● structuring of own work, generally determined by others.

Working

knowledge

Plans and performs own work independently or by interacting with others, generally receiving little direction, demonstrating:

● fundamental knowledge and can apply with minimal coaching and supervision

● planning and organising own work

● performs and drives own work forward

● ensuring quality of own work, normally getting it right.

Can do/

proficient

Works independently and helps to plan and guide the work of others:

● possesses the behaviour, skills and knowledge and can apply without any coaching or supervision

● resolves problems of others

● proficient, takes responsibility, flexible.

Exemplary, role model

Leads the direction of the work of others and teams:

● helps plan and drive forward the work of others/team by being proactive

● can look at the wider picture and is able to resolve significant business and people issues

● possesses specialised knowledge; applies knowledge without supervision

● develops new strategies, new initiatives and new approach to work

● uses external contacts and influences to drive change process within the organisation

● recognised internally as a role model and is sought by others for expertise

● influences others at a high level and is able to build co-operative relations across the business.



Appendix 6: Example of a competency rubric for a customer service position

Competence Developing criteria Accomplished criteria Exemplary criteria

Customer management systems operation

Navigates system to conduct transactions.

Trains others in how to conduct systems transactions with a customer.

Troubleshoots problems and issues with system functionality.

Customer service

Describes the use of the company services from a customer’s view.

Describes the standards which apply to their role.

Meets the minimum standards for their role.

Describes the steps to resolve customer conflict.

Recognised by customers as consistently meeting customer expectations.

Resolves customer conflict independently.

Recognised as consistently exceeding customer expectations.

Coaches others in delivering exceptional customer service.

Decision-making/ problem-solving

Breaks down problems into components and recognises interrelationships.

Shares the problem and solution with other people or parts of the organisation, where appropriate.

Escalates issues to appropriate level of decision-making.

Compares data, information, and input from a variety of sources to draw conclusions; takes action that is consistent with available facts, constraints, and probable consequences.

Conducts analyses that include an accurate assessment of risk and identification of worst case scenarios.

Ensures recommendations are carried through to successful completion.

Develops unique problem-solving analytical approaches.



Competence Developing criteria Accomplished criteria Exemplary criteria

Delivering results

Describes the results they are required to achieve.

Achieves targets.

Designs results for others to achieve.

Delivers team results.

Uses mastery of their discipline to develop new strategic directions.

Delivers above target results across departments or significantly (> 20%) exceeding team targets.

Engaging with respect

Builds rapport with others.

Treats others with respect.

Engages a wide variety of behavioural styles of people with equal ability.

Engenders respect from others.

Develops high achieving teams.

Manages relationships with people assertively.



Appendix 7: Example of probationary period assessment form

Associate name:

Associate department:

Appraisals conducted by:

Signatures

Goals established

______________________ Associate

______________________ Supervisor

______________________ Date

Six-week appraisal completed

______________________ Associate

______________________ Supervisor

______________________ Date

Twelve-week appraisal completed

______________________ Associate

______________________ Supervisor

______________________ Date

Probation completed

Successfully ______________________ Department Manager

______________________ Date Unsuccessfully

Development plan completed

______________________ Associate

______________________ Supervisor

______________________ Date

Quality of work

Is the associate’s work of good quality, requiring little re-work and featuring few mistakes?



Goals

Set the goals for the associate’s quality of work at the end of their 12-week probationary period.

________________________________________________________________________

________________________________________________________________________

________________________________________________________________________

________________________________________________________________________

Six-week review

Does the associate’s quality of work meet expectations?

Has not reached goals Reached goals Exceeded goals

Associate’s view

Supervisor’s view

Agreed view

Comments

________________________________________________________________________

________________________________________________________________________

________________________________________________________________________

________________________________________________________________________

Specific areas of improvement required

________________________________________________________________________

________________________________________________________________________

________________________________________________________________________

________________________________________________________________________



Twelve-week review

Does the associate’s quality of work meet expectations?


Associate’s view

Supervisor’s view

Agreed view

Quantity of work

Does the associate meet expectations in terms of meeting deadlines and the volume of work done?

Goals

Set the goals for the associate’s quantity of work at the end of their 12-week probationary period.

________________________________________________________________________

________________________________________________________________________

________________________________________________________________________

________________________________________________________________________

Six-week review

Does the associate’s quantity of work meet expectations?


Associate’s view

Supervisor’s view

Agreed view



Comments

________________________________________________________________________

________________________________________________________________________

________________________________________________________________________

________________________________________________________________________


________________________________________________________________________

________________________________________________________________________

________________________________________________________________________

________________________________________________________________________

Twelve-week review

Does the associate’s quantity of work meet expectations?


Associate’s view

Supervisor’s view

Agreed view

Job knowledge

Does the associate:

● demonstrate knowledge of company standards

● understand his or her duties

● have the skills required to execute his or her duties to company standards?



Goals

Set the goals for the associate’s job knowledge at the end of their 12-week probationary period.

________________________________________________________________________

________________________________________________________________________

________________________________________________________________________

________________________________________________________________________

Six-week review

Does the associate’s job knowledge meet expectations?


Associate’s view

Supervisor’s view

Agreed view

Comments

________________________________________________________________________

________________________________________________________________________

________________________________________________________________________


________________________________________________________________________

________________________________________________________________________

________________________________________________________________________

________________________________________________________________________



Twelve-week review

Does the associate’s job knowledge meet expectations?


Associate’s view

Supervisor’s view

Agreed view

Initiative

Does the associate demonstrate an ability to make decisions on her or his own, and complete assignments despite minor obstacles by using her or his judgement?

Goals

Set the goals for the associate’s initiative at the end of their 12-week probationary period.

________________________________________________________________________

________________________________________________________________________

________________________________________________________________________

________________________________________________________________________

Six-week review

Does the associate’s initiative meet expectations?


Associate’s view

Supervisor’s view

Agreed view



Comments

________________________________________________________________________

________________________________________________________________________

________________________________________________________________________

________________________________________________________________________


________________________________________________________________________

________________________________________________________________________

________________________________________________________________________

________________________________________________________________________

Twelve-week review

Does the associate’s initiative meet expectations?


Associate’s view

Supervisor’s view

Agreed view



Dependability

Does the associate:

● reliably complete assignments

● arrive on time

● demonstrate a willingness to ask questions when he or she is unsure?

Goals

Set the goals for the associate’s dependability at the end of their 12-week probationary period.

________________________________________________________________________

________________________________________________________________________

________________________________________________________________________

________________________________________________________________________

Six-week review

Does the associate’s dependability meet expectations?


Associate’s view

Supervisor’s view

Agreed view

Comments

________________________________________________________________________

________________________________________________________________________

________________________________________________________________________

________________________________________________________________________




________________________________________________________________________

________________________________________________________________________

________________________________________________________________________

________________________________________________________________________

Twelve-week review

Does the associate’s dependability meet expectations?


Associate’s view

Supervisor’s view

Agreed view

Adaptability

Does the associate:

● demonstrate an ability to adapt to changing circumstances

● complete tasks despite changing conditions

● demonstrate resilience to unexpected changes or difficulties?

Goals

Set the goals for the associate’s adaptability at the end of their 12-week probationary period.

________________________________________________________________________

________________________________________________________________________

________________________________________________________________________

________________________________________________________________________



Six-week review

Does the associate’s adaptability meet expectations?


Associate’s view

Supervisor’s view

Agreed view

Comments

________________________________________________________________________

________________________________________________________________________

________________________________________________________________________

________________________________________________________________________


________________________________________________________________________

________________________________________________________________________

________________________________________________________________________

________________________________________________________________________

Twelve-week review

Does the associate’s adaptability meet expectations?


Associate’s view

Supervisor’s view

Agreed view



Appendix 8: Example of probationary period checklist

Supervisor’s probationary performance appraisal checklist This checklist provides a guide to supervisors when completing performance appraisal activities during new associates’ probationary periods.

Task Date completed

Set goals and dates for meetings

Set goals with new associate

Obtain signatures and date template

Organise six-week and 12-week appraisal dates

Provide copy of template to associate

Conduct six-week appraisal

Ask associate to complete their section of template

Complete supervisor section of template



Provide copy of template to associate

Conduct 12-week appraisal

Ask associate to complete their section of template




Forward template to Department Manager for final approval

Complete development plan



Submit paperwork to HR




Appendix 9: Performance appraisal planning checklist

Supervisor’s performance planning checklist This checklist provides a guide to supervisors when completing performance appraisal activities during new employee’s probationary periods.

Task Date completed

Set goals and dates for meetings

Set goals with new employee


Organise six-week and 12-week appraisal dates

Provide copy of template to employee


Ask employee to complete their section of template




Provide copy of template to employee


Ask employee to complete their section of template




Forward template to Department Manager for final approval








Appendix 10: Personal development plan template

Name

Date of development Date to be reviewed

Discussed with mentor/colleague

Name:

Discussed with manager

Name:

Goals

Timeframe

My personal goals are (learning objective/s and action/s required)

These should relate to objectives in the individual performance plan.

My professional goals are:

These should relate to objectives to maintain current competence in the job role or future career paths.

Next 12 months

This will depend on type of activity priority/importance of undertaking it



Timeframe

My personal goals are (learning objective/s and action/s required)

These should relate to objectives in the individual performance plan.

My professional goals are:

These should relate to objectives to maintain current competence in the job role or future career paths.

Next 5 years

This will depend on type of activity priority/importance of undertaking it

Strengths and weaknesses

Timeframe Personal Professional

Required knowledge/ skills

Consider:

● required competencies

● job description ● service plans and

frameworks.



Timeframe Personal Professional

Strengths

Consider:

● your views ● recent

tests/appraisals ● other people’s

views.

Gaps/barriers/ obstacles and solutions

● gaps in knowledge/skills

● changes to systems/services requiring new skills

● what will help you to progress in your role?



Professional development activities

Identified gap Development activity

Details (provider, location, etc.) Objective of development activity Timeframe Cost

1.

2.

3.

4.



Appendix 11: Counselling template

Record of Employee Counselling

Employee name: ID#:

Position title: Dept:

Supervisor: Date of counselling:

Reason(s) for counselling:

Correction agreed:

Date to review progress:

I have been counselled by my supervisor. I am committed to make required correction(s). I understand that failure to do so may result in disciplinary action.

Employee signature Supervisor signature Date



Appendix 12: Written warning template example

Employee name: ID#:

Position title: Dept:

Supervisor: Date:

This is a written warning and notice to correct deficiencies.

Detail deficiencies or rules involved (who, what, when, where, why, how).

Actions agreed to correct deficiencies using measurable outcomes and specific timeframes.

Date of follow-up or further evaluation.

Failure to correct the deficiencies cited above will result in further disciplinary action up to, or including, termination.

Employee signature Supervisor signature Date

Record of previous action (if applicable):

Type Date Issued by
