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Presentation to the Portfolio
Committee on Public Enterprises
The Alexkor Performance Management Process
Presented By Arthur Sika & Yonella Nonyusa
19 March 2010
Executives Performance Management Process.
Board Performance
Management Process Process, Mechanisms and
Procedures Performance Objectives
Measurable objectives Evaluation of objectives
The Presentation Content
The Alexkor Performance Management Process - An Overview
Strategic Reward Management
Succession Planning
Performance Management
Job Evaluation& Broad Banding
Skills & Competency
Audit
ALEXKORBUSINESS
STRATEGY &VALUES
Retention Architecture
Career Ladder Development & Progression
Individual Development &
CoachingPlans
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The Alexkor Performance Management Process - An Overview
COMPETENCY MODEL
DEVELOPMENTJDs, JOB
GRADING & BROAD BANDING
INDIVIDUAL DEVELOPMENT & COACHING PLANS
CAREER PROGRESSION & SKILLS AUDITS
STRATEGIC REWARD MANAGEMENT
RETENTION RISK & SUCCESSION
DEPTH ANALYSIS & PLANNING
THE PERFORMANCE MANAGEMENT
PROCESS
STRATEGY
EXECUTION
ALEXKOR BUSINESS
STRATEGY
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The Background No Performance Management was in place Strategic Planning Vs Strategic Execution – The Integrated
Performance Management Model Strategy execution (through Human Capital) is critical to
strategic success; otherwise “plans will falter or wither on the vine because of poor execution,” i.e. poorly implemented Performance Management System.
Performance Management is the driving force or vehicle through which strategic plans are converted into deliverables
The Overview Of The Current System Performance management system for CEO & managers is
place. Performance contracts for CEO & Manager are in place. Performance review / appraisal takes place once ever 4
months Quarterly Performance reviewing is linked to rewarding
(Perf Based Pay) More details in this presentation……
The Alexkor Performance Management Process - An Overview
At Alexkor we view Performance Management as a process of
establishing a shared understanding of what is to be
achieved and how it is to be achieved and an approach to
managing people that increases the probability of achieving
success.
The Alexkor Performance Management Process - An Overview
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The Alexkor Performance Management Process - An Overview
1.Planning / Contracting
4. Rewarding / Recognition
3.Reviewing / Appraisal
2. Coaching / Feedback
Executing Strategy Through Performance Management
- Management Style –Creating Alexkor Climate / Culture
The Alexkor Business Strategy
PERFORMANCE
MANAGEMENT STRATEGY
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The Alexkor Performance Management Process - An Overview
The Performance Planning &
Contracting Phase
Alexkor Mission, Values & Strategic
Objectives
Performance Reward (Performance Related
Pay) Phase
Performance Appraisal As Per Balance Score Card
Measures Phase
Performance Feedback & Coaching
Phase
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The Alexkor Shareholders Compact / Corporate Objectives were cascaded into the CEO’s Performance Contract.
In the process the CEO’s immediate subordinates’ input was solicited (the bottom up approach) in the drafting of the CEO’s contract.
The CEO’s Performance Contract was then cascaded into the immediate subordinates’ Performance Contracts , the respective individuals were involved in this process.,
The respective manager’s Performance Contracts were then approved by the CEO before being signed by both the CEO & respective managers.
The various Managers’ Performance Contracts will be cascaded to their respective subordinates, again the respective employees will be involved in this process.
The employees Performance Contracts will also be checked & approved by the CEO, before being signed by the CEO, respective Managers & their respective staff.
The Alexkor Performance Management Process
- Performance Planning / Contracting Phase -
The measurable objectives as stipulated in the Shareholders Compact are as follows:
Continue operations as going concern and improvement of financial and operating ratios.
Revision of Alexkor Environmental Management Plan.
Conversion of old Alexkor’s old order mining rights to new order mining rights.
Transfer the converted land mining rights to Richtersveld Mining Company.
To enable the Pooling and Sharing Joint Venture between Alexkor and Richtersveld Mining Company
The Alexkor Performance Management Process
- Measurable Objectives -
Continued..... To transfer the specified immovable
properties ( farms and erven) Transfer all movable assets relating to
agricultural and maricultural businesses to the Richtersveld Agricultural Company.
Formal establishment in respect of the existing Alexander Bay village.
Compliance with MPRDA and any other relevant legislation and the terms and conditions of the mining rights.
Restructuring to achieve an optimum business model and establishment and implementation of appropriate control structure for Alexkor.
The Alexkor Performance Management Process
- Measurable Objectives -
Alexkor’s performance in relation to the strategic objectives is measured with reference to KPIs as set out on the Shareholder’s Compact which include the key items of the strategic objectives.
The KPI’s are included in Alexkor Corporate Plan and are reported on in the Quarterly Reports submitted to the Shareholder on periodical basis.
The measurable objectives as set out in the Shareholder’s Compact. These measurable objectives are cascaded from the CEO down to management and the entire organisation.
The Alexkor Performance Management Process
- Evaluation Of Measurable Objectives -
Revision of Alexkor’s Environmental Management Plan (EMP)
The revised EMP was submitted on November 2008 to the Department of Mineral Resources. We have so far not had any comebacks.
Conversion of Alexkor’s old order mining rights
The conversion was granted in December 2009. The execution should take place in about two to three weeks.
Transfer the converted land mining rights to the Richtersveld Mining Company (RMC)
The transfer of the rights will take place on execution.
To enable the Pooling and Sharing Joint Venture (PSJV) between Alexkor and the RMC
The DoS has certain suspensive conditions for the establishment of the PSJV
Revision of the EMP Conversion of the Old order Mining Rights Transfer of the Mining Rights to the RMC A mining plan is to be put together by the
interim joint board which does not include representatives of Alexkor. It is an independent Board which also has members of the Richtersveld Community.
The Alexkor Performance Management Process
- Evaluation Of Measurable Objectives -
Performance Contracts as cascaded from the CEO’s Performance Contract are all in place for the CEOs immediate subordinates as follows;
Mine Manager Financial Manager Mine Engineer Company Secretary IT Manager Human Resources Manager
The Alexkor Performance Management Process
- Performance Contracts For Management -
The Alexkor Performance Management Process
- Performance Planning / Contracting Phase -
Of essential significance in the Alexkor Performance Management Process is that both the Business Strategic Objectives & the Business Values were cascaded into the Performance Contract, as illustrated below.
Business Strategic Objectives
The Key Performance Areas
Behavioral Competency Model (Observable Behaviour –Living The Org Values)
Bottom Line Results Attained
Business Values
The Performance Contract
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The Alexkor Performance Management Systems encourages constant coaching & feedback in line with the Performance Contract.
T o ensure good understanding & proper use, the CEO & Managers were taken through the following
What is Performance Coaching? Guidelines for Effective Coaching (When To Coach,
How To Coach, What To Coach, Why Coach) Formal & Informal Coaching Guidelines for Providing Feedback (Positive Vs
Negative Feedback) Characteristics of Feedback for Improving /
Developing Performance Pitfalls to Avoid When Giving Feedback Guidelines for How Often to Conduct “Update
Review Discussions” Preparing for the Coaching Discussion Steps for Conducting the Coaching Discussion Key Communication Skills (Questioning Techniques
& Listening Skills) Tips for Observing and Documenting Behaviours
The Alexkor Performance Management Process
- Performance Coaching / Feedback Phase -
The Alexkor Performance Management Process
- Performance Reviewing / Appraisal Phase -
Performance Appraisals – On a Quarterly Basis
180% Performance Management Appraisal process is followed in Alexkor.
Manager review themselves first before sitting with the CEO to have a discussion on the overall performance review discussion for the entire quarter.
To ensure good understanding CEO & managers where taken through the following;
How to conduct a Performance Review? Overview of Steps in Performance Review Performance Reviewing – Guiding
Principles Preparing For A Performance Review What is the Quarterly / Annual
Performance Review Discussion? Steps for Conducting the Annual
Performance Review Discussion The Performance Ratings. Guidelines for Determining the Ratings Appraisal Pitfalls to be Avoided Dealing with Performance Review
Problems
In line with market related salaries & remuneration practices.
Fixed salary structure & Variable salary structure.
Linking Performance To Pay from the quarterly appraisals that are conducted.
Performance Based Pay System – the performance increment given is determined by taking note of current salary Vs the market & overall performance rating.
The Alexkor Performance Management Process
- Performance Rewarding Phase -
The entire Management team at Alexkor were then taken through Performance Management Training Program to ensure thorough comprehension of the following Performance Phases,
Performance Planning, Performance Coaching, Performance Reviewing & Performance Rewarding
The bottom line was to transfer expertise, ensure thorough understanding of the entire Performance Management process by the Alexkor Management to ensure effective application in Alexkor.
The rationale is that, Performance Management will never survive without Management thorough understanding & therefore support.
The Alexkor Performance Management Process - An Overview
When its implemented for the entire staff, they will as well be taken through a one day Performance Management Orientation Training Program to ensure understanding of the Performance Management Process
A Performance Management Policy & Procedure Guide for Alexkor – a procedural document that details the entire Performance Management System for reference purposes was is also in place.
The Alexkor Performance Management Process - An Overview
At the board meeting of February 2010 the board deliberated on the process for the evaluation of its performance.
The board agreed that a self –assessment of the board performance will be done and will be followed by an extensive board members performance evaluation by the Chairperson.
Thereafter and overall board assessment by an independent assessor. This process will take place during April 2010.
Board Performance - Implementing DPE Guidelines
The Remuneration of the Board of Directors is based on the DPE “ State Owned Enterprises: Remuneration Guidelines- Chairpersons and Non- Executive Directors”.
The SOE categorisation according to the Guidelines determine fee levels.
Board members are remunerated according to the Guidelines:
On retainer fee basis for Main Board Membership and Committee membership
At a median of the range for Alexkor size.
Board members are also reimbursed for the expenses.
Board Remuneration - Implementing DPE Guidelines
Turnover at Executive level
Turnover at Executive level
Financial Year
2008-2009 2009-2010
Exits 0 1
Headcount 0 6
Turnover 16.66
Demographics at Executive level
Demographics at Executive LevelFemal
eMale
African
African
White Total
31-Mar-10 1 2 3 6
16.67%
33.33%
50.00%
100%
Status on vacancies at Executive level
CEO Khetiwe McClain-Maseko
Security Manager (Consultant) C Wilmans
Mine Engineer M Mpanza
Company SecretaryT Kgari
CFO B Lategan
Acting Mine Manager W Basson
HR OfficerVacant
OCCUPIED
VACANT
Thank You
