Performance Management System or PMS is believed to be an HR process to evaluate people’s performance in order to reward people, decide on increments, variable pay and promotions. Therefore, line managers see it as additional work. One hears a usual rhetoric, “Should I do my business or should I spend time on completing PMS on the HRMS or discuss performance with team”. I would strongly suggest that line managers should not waste time if PMS is for people. They should stay focused on business.
However, imagine a situation where an
organization employs 5000 people. Can a
CEO do everything to achieve his Objectives?
Or can the ten people in the leadership team do everything to achieve
their or CEO’s objectives? On the
contrary while the leadership can provide direction, the real work is done by
4500 people at the bottom of the pyramid – salesmen, production engineer,
maintenance engineer, bank teller etc.
Unless their objectives are aligned with objectives of the CEO, CEO
cannot deliver on the expectations of shareholder.
A. How does an organization align
the entire organization with the objective of a CEO?
PMS is the tool to align the
organization with the objectives of the CEO.
Therefore PMS is primarily a business tool and it may also provide
inputs for various HR processes.
B. How does business leadership
effectively use PMS to help CEO deliver on his objective?
1. Own: Business leadership
should own and drive PMS process.
2. Cascade: While everyone knows
the importance of cascading the CEO objective through PMS, it is usually
executed well in sales driven organizations.
The other businesses struggle quite a lot to effectively cascade the
objectives.
3. Helping people deliver: Having set the goals, aligned with organization,
line managers have to constantly help their team members deliver by:
i.
Providing
Constant feedback
ii.
Coaching
them on course correction
iii.
Demonstrating
how to execute, where needed
Obviously
this is again something line managers, who know their job, can do the best.
C. What should HR do in the PMS
process?
1. Custodial Service: HR should
provide the custodial service to line managers by program managing the process.
In addition, it should be the eyes and ears of leaders to ensure their
objectives are met.
2. Capability Building of people
managers:
HR should focus on capability
building of people managers to help:
i.
Cascade
the objectives seamlessly
ii.
Coach
their team
iii.
Provide
constructive feedback
iv.
Train
team through demonstration
D. What is their in PMS process for
people?
Primarily a PMS process helps
people to deliver on organization objectives, which in turn helps people, learn
and grow. The learning is based on what
they do, manager’s feedback and his coaching and guidance. This is the biggest source of learning for
people.
By the way, PMS also provides
input for:
1. Learning and development
2. Compensation
3. Career Growth through lateral
and vertical opportunities
So PMS is the mother of all HR
processes. But PMS itself is a business process.
Most PMS processes that fail are people
centric and do not deliver business results. Therefore business managers are
not interested. In the bargain people do not learn and grow. The input that
such a PMS process provides to all the other HR processes is not rich enough,
making all the HR processes redundant from business perspective.
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