INTEGRATED PERFORMANCE
MANAGEMENT
The PBS dynamic integrated consulting concept recognises that as the
world continually changes and evolves, so must the organisation. An
organisation at one stage or another will be faced with the challenge
of how to attract, retain, motivate and manage the performance of
key contributors to the organisation's success. The PBS approach advocates
reward structures that reinforce both individual competencies and
performances, as well as those of the team and organisation. We design
them in such a way that they achieve the correct balance between the
shareholder value created by the employee and the rewards given in
both the short and longer term.
As the demand for performance continues to ratchet upwards increasing
demands are made on the senior management of enterprises to deliver
results - the quest for improved performance is never ending. One
of the most important opportunities that an organisation has to
increase organisational performance is through the way in which
it manages its people. The formal process for doing this is called
Performance Management. Accordingly, effective performance management
systems must become an integral part of routine organisational practice.
Emphasizing management process, performance management requires
strong management skills and commitment. Its goals are to:
- Translate organisational objectives into individual goals for
employees.
- Focus employee behaviour on key actions that will affect organisational
results.
- Facilitate the agreement between employees and the organisation
on goals and objectives.
- Establish a process for on-going communication and coaching
orientated around goals and performance levels.
- Foster a result-orientated dialog between employees and the
organisation.
- Promote a climate supporting superior performance.
The relationship between performance management as a management
process and other critical organisational levers is illustrated
below:
 Click image to enlarge
The corporate litany for the 21st century appears to be:
Companies require capital…
Capital requires investors…
Investors require performance…
Performance requires focused management
Within this litany there is the critical link between investor
expectations and senior management and executive pay. Current research
indicates that investors are not opposed to high levels of pay when
it is tied to equally high levels of performance and hence increases
in shareholder value. The process for linking these issues is performance
management.
PERFOrMANCE RELATED PAY & COMPETENCE RELATED PAY
The PBS Performance Related Pay (PRP) approach can operate on an
individual, team or organisation wide basis. Our advice to clients
is, PRP schemes need careful implementation to achieve maximum effectiveness
and acceptability.
Our experience in implementing this concept in companies in Africa
has shown that the concept of notching (previously held in high
regard in many companies in Africa) is rendered immaterial and a
non-issue. The notching system assumes that issues of tenure / number
of years served as well as qualifications acquired takes precedence
over performance issues. The latest thinking in Strategic Human
Capital Management regards notching as a traditional and outdated
tool that contradicts with the very nature of a Performance Management
Culture. At PBS we assist organisations to comprehend that the Competence
/ Performance Related approach is not just about paying for the
acquisition of the competence. It is about the effective use of
competence to generate value, the value - added differential concept.
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Performance management