Breakfast Forum newsletter – May 2009
Why do employers manage performance? This was the question posed to members at the last Breakfast Forum on 15 May. It resulted in a lively discussion, with answers ranging from “because everyone else does it” to “it has fallen into disuse because of lack of time” and “to have a happy successful company”.
A summary of the benefits of performance management for employees and employers is attached.
Of course when performance management has failed to improve you may need to take disciplinary action. Our next Breakfast Forum on Friday 12 June will focus on the management of a disciplinary investigation. The 2004 statutory disciplinary and grievance procedures were replaced last month (April) by the new Acas Code of Practice. The statutory procedures are abolished and employers are encouraged to look at mediation to resolve workplace disputes.
The situation is not yet clear cut. Employment tribunals will be dealing for some time to come with cases founded under the previous statutory regime, which will still need to be decided by the old rules. This is so where the disciplinary process or substance of a grievance predate the April changes. In new cases, failure to follow the Acas code may lead to a 25% increase in compensation payments.
The forum is an opportunity to discuss and share your experiences with other employers in the informal setting of the Rose and Crown in Elham, while enjoying the pub’s excellent cooked or continental breakfasts.
If you are interested in attending the next forum on 12 June, please contact anne@employment-relations.co.uk, tel: 01303 840001.
Performance management
What emerged from the last forum is that different companies have different reasons for managing performance – it’s not one size fits all. Members suggested they manage performance to set objectives, to define standards and competences so they can be accurately measured and performance improved, to provide excellent customer service, to improve communication within a company and to make their company happy and successful. Some were even honest enough to admit they did it because others did and they felt they should too. All agreed, however, that embarrassment was often a significant obstacle to effective performance management.
Peter Read of Eurotunnel explained the special issues facing a binational company because of different attitudes in the UK and in France.
The company took a close look at how it communicates to solve specific problems such as reduced performance from long-term staff, consistency of appraisals, and to clarify the different roles of supervisors and managers.
A staff survey revealed where management processes were lacking and where communication could be improved. A 360 degree process now addresses all aspects of communication. Poor performance is tackled through continuous communication rather than just once a year at appraisal time.
In contrast Linda Sinclair of ADM, a computer services company with about 40 employees, explained her company’s policy of continuous communication involving the customer. This requires appraisals to be done almost on a daily basis, to catch problems early before they become real issues. Linda has an open-door policy and meets staff in the informal setting of the customer area which promotes free exchange of ideas. She also firmly believes that customer feedback is an important part of appraisal. Appraisals are conducted annually but with a six month progress review as it is important to be seen to commit to what was agreed during the appraisal interview. The emphasis is on good, continuous, two-way communication to involve staff and make ADM a happy successful company.
Dr Daniel Simmonds of the Canterbury firm psicon that specialises in psychological and physical health and wellbeing, talked about the psychological aspects of performance management. Good performance management should lead to employees understanding that their performance affects the whole organisation.
To sum up it was agreed that establishing clear targets for the next six months or year and the business plan should be the starting point when designing any performance management system. Appropriate monitoring will undoubtedly lead to higher productivity through enhanced job performance and will increase profitability, but it must suit the needs of each individual organisation. It is better to have a simple assessment system that is easy to understand, commands respect and is delivered regularly, than highly sophisticated tools that neither appraiser nor appraised can comprehend. It will be immediately obvious even to the rawest recruit if line managers have themselves not been trained in effective performance management. There is surely nothing more counter productive than a training programme that attracts ridicule.
Benefits of Performance Management
Benefits for employees:
the opportunity for promotion and self-improvement;
improved job satisfaction through better job performance;
a challenge – the chance to learn;
adaptability – greater ability to adapt and cope with change;
establishes a capacity for ongoing learning;
builds individual confidence; and
it creates a climate for development and growth.
Benefits for the employer:
higher productivity through better job performance and more efficient use of human resources;
goals and objective are met;
reduced costs due to lower staff turnover, fewer errors and complaints, accidents and absenteeism;
staff are better able to plan for the future and cope with difficult challenges;
ensures it benefits from changes which can improve efficiency or its competitive position e.g. through legislative or technological change;
improved profitability;
improved management and leadership qualities motivation and attitudes; and
improved team working, loyalty and trust.
