Manzoor Tallat HRM/531 March 26, 2014 Malcolm Mumford PERFORMANCE MANAGEMENT PLAN 2
Performance Management Plan To: Mr. Bradley Stonefield From: Manzoor Tallat (Atwood and Allen Consulting) Date: March 26, 2014 Subject: Performance Management Plan For the success of a business, a strong performance management framework is necessary. Strong performance management plan includes alignment with the business strategy, considering an organizational philosophy, performing job analysis, choosing methods to measure employees skills, determining a process for addressing skill gaps, and an approach for delivering effective feedback. This memorandum will provide some suggestions on how to create a resilient performance management framework, which will set Landslide Limousine on the path to success. Organizational Business Strategy In prior communications we were informed that your business location is Austin, Texas and that providing first-class personal transportation to the customers is your business strategy. Furthermore, you stated your projected first year net revenue will be approximately -$50,000, and you expect a 5% net revenue increase over the next few years, and you estimate a 10% turnover rate. Based on your projections we believe Landslide Limousine has realistic goals for the first few years of business. A well thought out performance management framework will align these goals, encourage employee loyalty, and set the basis for future financial growth.
PERFORMANCE MANAGEMENT PLAN 3
Organizational Performance Philosophy As part of Landslide Limousines performance management framework, it is vital to identify your organizational performance philosophy. In order to establish limousine business in Austin, Texas, amongst an existing competitive market, the philosophy must be built on top- notch customer service. To build a positive reputation in the market employees must understand what is expected of them. Behavior-oriented rating method is recommended in order to evaluate the employees. Capturing customer satisfaction is the key to performing behavior-oriented ratings. A simple, yet effective approach would be to create a behavioral checklist based on questions asked on Landslide Limousines customer satisfaction survey (Cascio, 2013). Another effective method would be to evaluate each employee using a graphic rating scale. Graphic rating scales are set up with rating factors down one side, such as attendance, appearance, and relationships with people, and level of performance across the top (Cascio, 2013). This information can be obtained from customer feedback and individual evaluation. Job Analysis The next step in creating a solid performance management framework is to decide on the job analysis you will complete in order to identify the skills needed by your employees. According to Cascio, job analysis is the procedure of obtaining information about jobs and includes information about the responsibilities to be performed on the job, as well as the individual characteristics (education, specialized training, experience, personality) necessary to do the task, (2013, p.165). There are several methods that can be utilized to determine the necessary skills for your employees, but we suggest the observation and critical incidents methods. The observation method requires an analyst to observe a worker and records the, why, PERFORMANCE MANAGEMENT PLAN 4
what and how of different components of the job, (Cascio, 2013, p. 172). In order to accomplish this method you should use the services of other limousine companies in the area and record the information in a standard format (Cascio, 2013). The critical incident method is comprised of concise actual reports that demonstrate particularly effective or ineffective employee behaviors, (Cascio, 2013, p. 173). You can accomplish this method by recording situations that you encounter while using other limousine services. This information will give you a clear picture of job requirements and assist you in developing customer service that out performs your competitors (Cascio, 2013). Skills, Skill Gaps, and Feedback Once you have determined the necessary skills your employees must have you need to establish methods to measure the skills, how you will address skill gaps, and your approach for delivering effective performance feedback. Previously Atwood & Allen suggested that you use Behavior-oriented ratings in order to measure your employees skills and performance. In order to establish this method Landslide Limousine must set goals for each employee. Goal setting has a proven track record of success in improving performance in a variety of settings and cultures, (Cascio, 2013, p.333). To effectively evaluate each employee consider assigning each goal a value. When it is time for evaluation you take the numeric score, based on goals achieved, and customer satisfaction input and you have established the basis for the evaluation. This approach allows you to see where each employee ranks against other employees within your organization. Benefits such as bonuses and pay raises should be tied to performance and the evaluation. Atwood & Allen recommends quarterly performance evaluations in order to assess employee performance and keep business on track with the companys strategic goals. If skill PERFORMANCE MANAGEMENT PLAN 5
gaps are identified it is important to address them immediately. The most effective way to address skill gaps is with training (Cascio, 2013). There are several training methods, but the simulation and On-the-job training methods are appropriate considering the business. The simulation training method uses techniques such as role playing and behavior modeling, which are appropriate to improve skill gaps with customer service issues. Additionally, on-the-job training (OJT) is another training method that you can utilize. A good time to use this method will be if you have an employee that isnt getting good customer feedback. You can place the employee with an employee that has exceptional feedback to let him/her see how to better handle situations and interact with customers. Lastly, to complete your performance management framework you must deliver effective performance feedback. Landslide Limousines reputation and place in the market depend on superior customer service. Frequent feedback will assure management and employees are working together to meet the organizations strategic goals. Atwood & Allen recommends formal quarterly and annual written evaluations. Additionally, it is imperative that Landslide Limousine keep the informal lines of communication open with employees to include, providing immediate feedback to employees based on customer comments. Management and employees should have regular meetings to discuss goals and strategy. Frequent communication and feedback will assist Landslide limousine with performance management. The performance management framework suggestions laid out in this memorandum are provided to assist you in getting Landslide Limousine off to a successful start. Please do not hesitate to contact us if you require any clarification or have further information.
PERFORMANCE MANAGEMENT PLAN 6
References Cascio, W. F. (2013). Managing Human Resources: Productivity, Quality of Work Life, Profits (9th ed.) New York, NY: McGraw-Hill/Irwin How to Start a Limo Company in Austin, Texas. (n.d). Retrieved from http://smallbusiness.chron.com/start-limo-company-austin-texas-17300.html