Performance Management System

             Performance management system is a continuous process where managers and workers join efforts to ensure a company’s success by planning, observing and reviewing a worker’s goals and objectives. This helps to track the performance of an employee, department and the overall organization thus improving their effectiveness. Rewarding the staffs’ exceptional performance increases their motivation to work better. PMS also helps to empower managers and hold them accountable for managing their staffs. This paper studies the presentation of performance management system by the Human resource manager for Non-governmental organization’s Finance Assistant including the organizational strategy, system, implementation factors and the factors to consider for employees development.

Organizational strategies.

 The main goal of performance management is to help organizations goals achievement. These goals help to develop the company’s vision and mission. If effectively utilized, the performance goals join hands with the organization purpose thus promoting success. The purpose of the Non-governmental organization is to promote a specific cause including awareness, knowledge and acceptance by activist events. The NGO’s mission is to facilitate development of a community that is effective enough to influence the United Nation’s activities worldwide (Bourne, 2000). The organization’s vision is to provide support all communities globally which are committed to United Nations decision-making process focused on making the world a better place with economic stability and social justice.

System

Performance management system includes three steps:

 

Middle point review Enter mid-point comment View staff member comments and enter comments Finalize mid-point review

 

 

 

 

 

 

 

 

 

 

 

NB/The below terms of reference will assist in explanation of the three phase of performance management (Finance Assistant (cashier) in an NGO setting

                        Terms of reference

1. Posting accounting transactions (accounts payable) in SAP accounting system.
2. Review of travel claims and imprest accounts and verify authenticity of the supporting documents provided.
3. Timely dispatch of monthly accounts for the organization to Headquarters.
4. Ensure the office have some money for small items needed for the organization. Also control authorization and documentation in the company.
5. Create down payment request to vendors in the SAP system and ensure the request is supported by the relevant documentations and properly followed up for clearance.
6. Regularly review vendor accounts and items for ageing records and ensure outstanding amounts are cleared as per the financial Management rules and regulations.
7. Perform the organization’s bank reconciliations.

Initial Stage

        This is a stage that involves both the employee and the supervisor, it helps in development of a working plan that contains the objectives to be achieved, results expected from employee and the measures used for assessment of performance.

        An employee must identify three or four areas of key performance (objectives) within a year that will act as a measure to his or her performance which is either evaluated as satisfactory or un- satisfactory, this is determined by the employee’s terms of reference or the job description (Amaratunga & Baldry, 2002).

All set objectives must be SMART meaning; Specific, Measurable, Achievable, Realistic, and Timely. The work plan is always approved by the supervisor

1. Ensure timely payment and review of vendor accounts by timely confirmation of vendor’s bank details and posting accurate transactions to the SAP system upon a day of receipt of the accounts payable documents.

Indicators /measures

• Early identification of errors
• Reduce payments back loads.
• Reduce complaints from the vendors on late payments.
• To provide evidence in respect of existence, ownership, and accuracy (Bank confirmation)

2. To ensure timely dispatch of monthly accounts for the organization to Headquarters by the first week of the month.

Indicators /measures

• Assist in meeting the timelines for accounts closure in the head quarter.
• Early identification of errors

3. To review the imprest system within a month of travel claims in order to determine the company’s ability to support the travel and to verify the travel documents provided.

Indicators /measures

• Reduce posting errors& errors related to payments
• Enhance efficiency and effectiveness hence reducing audit queries.
• Timely payment of travel expense claims and charge to projects

4. Ensure the office have some money for small items needed for the organization. Also,

control authorization and documentation in the company.

 

Indicators

• Adequate financing in the cash office.
• Identify errors and correct them before month end closure.
• To ensure completeness and existence i.e. that there is no unrecorded cash

Middle-point review

        This stage entails monitoring of employee for the PMS to be effective. Monitoring does not mean watching every step of the employee by the manager but the results achieved, the employee’s behavior, and the factors affecting their working environment. During this stage, the HR and employee set meetings to: First, Evaluate the factors affecting the employee’s performance. This helps to improve the working conditions of workers (Bourne, et al, 2000). Second, share the feedback on the goal achievement progress. The manager should include the positive feedback to motivate the employee. Positive feedback involves letting the employee know their achievements in relation to the evaluation objectives. The manager’s feedback should also be honest in order to give the employee a room for improvement before their mistakes escalate.  Third, to evaluate the changes that may have occurred in the organization’s objectives and need to be added to the work plan. Finally, to helps the Human Resource manager to determine the extra support that he or she needs to offer to the employee.

End of cycle evaluation

        At this stage, the manager reviews the performance of the employee throughout the year. Self-evaluation is important for performance appraisal thus the managers gives the assessment form to the Finance Officer. This is to help the officer to evaluate his or her overall performance before meeting with the manager for the appraisal meeting. The manager should review their assessment form thoroughly before assessing the employee. The following should be covered during the Manager and employee’s meeting:

 

 

Give a brief summary of the accomplished objectives as compared to the previous assessment year’s objectives. Including the major achievements, the outcomes and challenges faced for the attainment of each objective.

• Identify the problems faced throughout the performance year and evaluate areas for improvement.
• Identify and evaluate the barriers to achievement of objectives of the Finance Assistant.

        After evaluation, the overall performance of the Finance Officer was perfect. The organization should consider giving the cashier a salary increment and a medical cover for motivation.

        The manager need to consider some implementation factors. Implementation is the execution or practice of new ideas or plans for doing something. The HR implements the organization’s goals and objectives to the Finance Officer and ensures that the goals are achieved. There are several factors to consider during the implementation process: One factor is communication plan. The most effective plan would be all-team announcement Email (Franco et al, 2007). This is where all employees are called to a meeting one week before the launch and made to understand the program.  The manager should use this time to get the employee to buy the idea.

        In case the employee disagrees with the supervisor’s evaluation results he or she has the right to appeal. First, he or she should write to the officer of the HR ten work days from the date the manager signs the document. Secondly, a member of the HR department will conduct investigation on the supervisor and the employee and a resolution will be put forward. However, if an agreement is not reached during the investigation and the agreement signed by the parties involved, the assessment will be final and the appeal should be stopped (Evans, 2002). The assessment documents should be handed over to the HR department and should remain private. In case the employee wants to withdraw the appeal, he or she should write to the HR who will inform the other parties.

        The manager should consider some employee’s development factors. First, the managers should encourage the Finance Assistant to take his or her mistakes as a part of learning process. This encourages the employee to thrive on and learn from their mistakes (Bourne et al, 2003). Secondly, the manager should support the employee’s learning with resources. This can be achieved by budgeting for the resources annually. Finally, the manager should provide adequate time for the employee to get the necessary training for a successful employee program.

Learning Outcomes

        Some factors need to be considered when setting up pay plans. First, the organization should consider those employees who will participate. This is according to the employee’s eligibility and their capabilities. Secondly, organizations should determine the role of equity during a reward framework by gathering the employees and supervisors’ perspectives.

         An employer may use several application methods to reward employees. First, bonuses is a good a way to reward employees for a good job done. This mostly applies to sales persons to motivate them to generate more profit for the company. Organizations should be careful to ensure that they reward exceptional achievements rather than achievements in the basic functions. This helps to maintain the value of bonuses. Second application method is through profit sharing, this is where the company takes a certain percentage of its profit and disburses it amongst employees. This shows the company’s appreciation of employee’s efforts towards the achievement of profit goals (Evans, 2002). Unless well managed, profit sharing may not give enough motivation to employees as the reward is meant for anyone anyway. Another effective reward method is promotion. Employees who are exceptional and loyal to the company should be promoted to appreciate their efforts. However, the manager should be fair when implementing this method as the other employees may feel discriminated. Stock options is another effective way to reward employees. It allows employees to buy the company shares at a fixed amount for a certain period of time. Companies view stock options as an effective motivation strategy, and also, a token of appreciation to loyal employees. This method can be risky especially if the fixed price of the company’s shares is higher than that of the outside market. The shares become worthless to the employee.

        There are several team evaluation principles in PMS. First, performance standards is important during assessment. This entails the amount of effort an employee puts towards achievement of a certain goal. Second principle is unbiased evaluation. Biased evaluation is where a supervisor relies on the recent actions of the employee instead of evaluating performance for the last one year. Limited feedback is where the employee waits for a whole assessment year to give feedback to the employee instead of reminding him or her of the mistakes done for rectification. Supervisors should avoid biased evaluation in order to promote employee’s success (Amaratunga & Baldry, 2002). Thirdly, performance evaluation needs the manager and the employee to set goals which are attainable within the assessment period. These goals must follow the SMART technique to be effective to the organization. Also, communication is important during the assessment period. This helps the employer to get feedback from the employee in order to assess his or her progress and be conversant with the employee’s grievances. Finally, employees who perform well should be rewarded. This boosts their morale thus performing better in their duties.

        Performance management is necessary for any organization as it keep employees on their toes knowing that they are being monitored thus promoting success in an organization. Therefore, managers should be consistent in evaluating the employees’ feedback in order to help them improve before the final assessment review. Also, rewarding employees after a successful performance period encourages them to be more productive in a company.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

References

Amaratunga, D., &Baldry, D. (2002). Moving from Performance Measurement to Performance

        Management. New York: John Wiley.

Bourne, M., Neely, A., Mills, J., & Platts, K. (2003). Implementing Performance Measurement

        System. United Kingdom: Cranfield University Press                                               

Evans, J., & Lindsay, W. (2002). The Management and Control of Quality. Cincinnati: South

        Western.

Franco-Santos, M., Kennerly, M., Micheli, P. (2007). Towards a Definition of a Business

        Performance Measurement System. United States.