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Performance Management SystemPerformance Management System&&
Creative Compensation StructureCreative Compensation Structure
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Purpose of PMS Purpose of PMS
To get better results for the organisation
To establish a improved work culture in theorganisation
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PMS Consist of PMS Consist of
Work plan
Corrective action plan
Individual development plan
Performance appraisal Performance documentation
Performance pay
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Performance Management FrameworkPerformance Management Framework
Performance Review
Corporate Strategies Business Plan Business Role
Performance AgreementObjective
Competencies Plans
Managing Performance throughout the Year
Feedback
Performance Rating
Performance Related Pay
Personal Development
Assessment Centre
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Cycle of Performance reviewCycle of Performance review
Communicate
ObserveEvaluate
Set GoalsSet Goals
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WhyWhy Measure Performance ?Performance ?
BecauseBecause
What you cannot measure you cannot improve.
Ifyou cannot improve you cannot grow. Measurement helps in objectively differentiating between
performers and non performers.
Pay for performance is possible only through
metrics.
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KEY RESULT AREA (KRA)
KRA is defined..
Process of measuring KRA is Appraisal.
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CreatingCreating SMARTSMART GoalsGoals
S pecific / StretchS pecific / Stretch
M easurableM easurable A greeable A greeable
R elevantR elevant T ime T ime--boundbound
Performance Objectives
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Who Will appraise
Appraisal by boss(es) or superior(s)
Appraisal by superior(s) and self
Appraisal by boss(es), self and one or two internal people
360 degrees performance appraisal
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PMS helps to decide
Training and Development
Career and Succession Planning
Rewards and Recognition
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FEEDBACK
Suggested feedback
Constructive praising
Constructive criticism
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Performance Improvement Plan
Coach & Mentor individuals to help them raisetheir performance
Identify and nurture talent in their area
Employ appropriate retention strategies Provide necessary training (Technical, Human &Conceptual)
Evaluate the effectiveness of learning
Formalise feedback with HR
Job Rotation
Job Enlargement:
Job Enrichment
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Salary
Compensation Strategies
Direct Compensation
Compensation System
Indirect Compensation
ProtectionProgrammes
Medical insurance
Life insurance
Disability income
Pension
Social security
Pay fortime notworked
Vacations
Holidays
SL
Services &perquisites
RecreationalFacilities
Car
Financial planning
Low cost or free
meals
Incentive pay
Bonus
Commission
Piece rate
Profit sharing
Stock option ESOP
Shift Differential
Differedpay
SavingsPlan
StockPurchase
Annuity
Merit
Pay
Base
Pay
Wages
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Final Thought
The conventional definition of management is getting
work done through people, but real management isdeveloping people through work
- Agha Hasan Abedi
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THANKYOU