Agenda■Focus of Performance Appraisal Year 2014

■Understanding the Balance Score Card (BSC)■Use of Balance Score card■Elements of BSC

■Financial■Internal Business Process■Customer■Learning & Growth

■Link of four (4) elements in Balance Score Card■Performance Appraisal Year 2014

■ Sample KPI’s for Financial perspective■ Sample KPI’s for Internal Business perspective■ Sample KPI’s for Customer perspective■ Sample KPI’s for Learning & Growth perspective

■Competency■About competency■Performance Appraisal Year 2014■Core Behavioral Competency Dictionary

■Weightage■Percentage of division for each level of management

Focus of Performance Management

■Development & Growth of Company■Future Goal Commitments (Planned

Achievements)■Documentation of Good and Weak Performance■Feedback for Sub-Ordinate■Staff

■Talent development■Rewards

What is Balance scorecard■The Balance Scorecard is a strategic planning

and management system used to align business activities to the vision and strategy of organization by monitoring performance against strategic goals

■It’s a tool that provides stakeholders with a comprehensive measure of how organization is progressing towards the achievement of its strategic goals

■It balances the financial and non financial measures

■It improve internal and external communications, and monitor organization performance against strategic goals.

■Balance short and long term measures

Use of Balance scorecard:

■Information about Balanced Scorecards indicates:

– which will eventually lead to higher shareholder value (financial).

– that deliver specific value to the market (customer) – knowledge, skills and systems that your employees will

need (learning and growth) – innovate and build the right strategic capabilities and

efficiencies (internal processes)

Four elements in Balance scorecard

Financial perspective:■The financial performance perspective of the

balanced scorecard addresses the question of how shareholders view the firm and which financial goals are desired from the shareholder’s perspective.

■These financial goals are dependent on the company’s stage in the business life cycle.

Internal Business Processes perspective:

■Internal business process objectives address the question of which processes are the most critical for satisfying customers and shareholders

– A firm must concentrate its efforts to excel in these areas

■Metrics based on this prospective allow the managers to know how well their business is running and whether its products and services conform to customer requirements

Customer perspective:■With customer perspective managers and companies have to

be careful and make sure they are setting up their balance scorecard to help customers.

■Examples of things that don’t concern customers are profit per customer, revenue per customer, and improve profit per customer.

■These objectives don’t necessarily protean to the customer perspective but rather the companies perspective of the customer.

■Managers need to take a step back and look at how customers perceive your company and what they want to get out of your company.

Learning & Growth perspective:■The learning & growth perspective focuses on the

intangible assets of organization, mainly on the internal skills and capabilities of the employees that are required to support the value-creating internal processes.

■It must focus on measurable outcomes to move the company forward

■It focuses on:– Human Capital - Jobs and people issues– Information Capital – Systems and technology issues

How does Balance scorecard link:

PERFORMANCE APPRAISAL YEAR 2014

Samples of Financial perspective:

■Return of capital employed - ROCE■Return of equity – ROE■Return of investment – ROI■Maximize utilization of assets (include staffing)■Cost management■Risk management

Samples of Internal Business Processes perspective:

■Operations Mgmt– Supply– Produce– Distribute

■Customer Mgmt – Select Customers– Acquire New Customers– Retaining Customers– Business Growth

■On time Delivery ■Average Lead Time (No)■Contracts filed without error (No)■Lead time, product development (No)■Lead time, from order to delivery (No)■Lower error rate■Reduce rework■Improve quality

■Innovation process – New Opportunities– Design & Develop– Launch

■Regulatory & Social Process– Employment

Samples of Customer perspective:

■Annual sales / customers ($)■No of complaints ■Response Time■Customer retention■Annual Sales per customer■Brand Image index (%)

■Product / Service Attributes– Price– Quality– Availability

■Relationship – Services– Partnership

■Organization Image– Branding

■Customer Value – Selection– Functionality– Satisfaction

Samples of Learning & Growth perspective:

■Training hours per employee■Absenteeism / Illness rate ■Turnover Rate■Employee’s productivity■Leadership development■Internal promotions %

■Intangible Assets– Human Capital

• Staff Turnover• Retention• Staff productivity• Talent development

– Information/Knowledge mgmt• Delivery of internal

process• Knowledge sharing

■Strategic Theme– Culture– Leadership

Competency

About Core Competency■It is the ability of an individual to do a job.■It is a set of defined behaviors that provide a structured guide

enabling the identification, evaluation and development of behavior in individual employees.

■Competency include knowledge, skills, abilities, and attributes that form a person’s job

■Core competencies is the Strategic strength of an organization■It provide the way to define in behavioral terms what is that

people need to do to produce result that organization desires, in a way it keeps with it’s culture.

■It helps the organization to know potentially what resources might be needed to help on employee’s development.

■Competency aligns the performance management, learning & development and rewards practice to reinforce key behaviors for organizations values.