Discussion
Examine the effectiveness of various performance measurement practices within the HRM system.
Performance measurement is a system of measuring the capabilities of the workforce from both collective and individual perspective that can enable the company to improve the overall productivity of by providing sufficient development and motivation. It is a specific practice of human resource management system aligned with the overall business strategies and optimisation (Davila, Epstein & Manzoni, 2012).
This paper has been discussed about the current performance measurement practices of the company CERA. CERA or Civil Engineering Research Association is a consulting company that guide their client about civil construction to eliminate the potential loss as the result of the earthquake or other natural calamities for civil building, roads, bridges, airports and other construction. Currently, the company is experiencing low productivity and employee performance that needs a close observation of their current employment policies to find the possible way of improvement.
This paper is focused on the human resource management of CERA that is affecting the overall organisational performance. One of the effective human resource management practices of CERA is performance measurement and rewarding system. The paper has examined the current performance measurement policies of employee relationship approach within CERA. Therefore, the possible way out from this current condition has been identified by analysing to alternative ways of performance measurement system that can be implemented in the HRM policies of the company. In this paper, the human resource management of CERA has been suggested to use two additional performance measurement systems within their HRM practices, namely Quality approach and Result recognition approach. In order to recover from the current state of performance declination, the advantage and disadvantages of these approaches are analysed to find out the correct implementation process within the HRM system of CERA.
The limitations of CERA’s individual performance measurement:
Performance measurement enables the management to introduce the company’s objectives to the individual employee regarding their job role and operational department. Performance measurement of any company should have a measurement and appraisal cycle. CERA follows these measurement cycle through three-stage architecture namely monitoring, planning and execution. In the planning section, the performance measurement of CERA has two parallel platforms those are Training for low performers and appraisals for quality performers. Although this systematic approach has some remarkable benefit on employee performance and employee motivation, the initial stage of the identification process is not satisfactory for the ground level employees (Schleifer, Sullivan & Murdough, 2014). The performance measurement that is followed by the human resource management of CERA is Management by Objective (MBO) approach.
The monitoring process is the primary and most important part of performance measurement system. Every company has their own monitoring system that helps them to observe the performance level of the employee irrespective of their departments and designation. The proper identification from the analysis of the monitoring report is the most significant duties of management of an organisation. Apart from that, there are two optional monitoring system namely primary monitoring and secondary monitoring system. In primary monitoring, the management observes the employees through performance score and surveillance system. This approach is the more close monitoring system secondary monitoring system. On the other hand secondary monitoring system based on the review based approach where the management has to collect feedback about operational anomalies from both leaders and subordinates (Davila, Epstein & Manzoni, 2014). The selection of appropriate monitoring system depends on the situation of the business operation and the collective performance of the workforce.
The limitations of CERA’s individual performance measurement:
In current human resource practices and policies of CERA, the management depends more on hierarchical feedback based performance identification. Although this identification process consumes less time and very effective in the fast-paced organisational environment, the demerits of this process can cause a severe collapse of operational workforce productivity. In many cases, it has been found that leaders provide vague and biased feedback about the subordinates or an individual. This problem not only makes the employee irritated, it also makes the management to waste time, energy and money for unnecessary training and development (Gamble & Beer, 2017). On the other hand the most important dilemma of this situation it reduces the employee satisfaction level and employee to employer relationship that can cause high employee turnover and low inbound manpower from narrow labour market. Because of low employee satisfaction, the faulty performance measurement system causes lower employer reputation in labour market.
Recently CERA has been failed in many cases because of their lack of employee count and unsatisfactory workforce performance. The above discussed approach of Human resource can be caused this type of discrepancy that has a strong impact on company’s profitability. The one sided feedback is the major limitation of this company which is causing unexpected turnover rate as well as low performance level of existing employee. Additionally, this condition also improvises the ethical aspect of the company which is under the regulation of ethical work environment maintenance (Otheitis & Kunc, 2015). Similarly, this anomaly in the primary section of recognition system has high negatively influenced the second and third stapes of the performance measurement system in CERA. Therefore, the traditional process of feedback collection from the immediate superior is not always beneficial; however, it can cause faulty recognition system. It is one of the significant disadvantages of management by objective approach for the performance measurement system of CERA.
In the second stage of performance measurement system, the human resource management of any company should focus on the planning for performance uplifting and encouragement (Bourne et al., 2017). As per the previous discussion about recognition process, there are other possibilities of wrong identification, where the management can have a week performing employee recognised as a quality performer. In this situation, the management of CERA usually treats the selected employee as other productive employee and provides additional incentives and appraisal in term of promoting the designation of the selected individual. As a result, inappropriate candidate for a designation can cause huge disaster in work environment and productivity which has been suspected as a core cause of the performance collapse of CERA. Similarly, the company can lose an appropriate leader who could boost up the departmental performance for this corrupted recognition system.
Another limitation of the HRM practices of CERA is its tool selection for employee appraisals, which has a significant influence on performance recognition system as well. The company often use internal recruitment approach as part of performance measurement and appraisal process. However, this process is not suitable for all situation, especially where a particular employee has high performing ability and low leadership quality (Ferson & Mo, 2016). Therefore, transparent recognition is not the only solution for performance development. On the other hand in a fast paced work environment, two parameters are used to measure the performance level of an employee, namely quality measures and quantity measure. In this current organisational structure, there is no different measurement process used for performance measurement which can also cause some decrements of overall productivity. However, the only solution of this faulty measurement system can be a proper amendment to the conventional HRM practices of CERA.
In the second stage of performance measurement system
Recommend two alternative measurement approaches and indicative methods:
From the previous discussion, it is clear that the human resource management of CERA majorly follows the management by the objective approach where the monitoring is conducted by collecting feedback from the immediate superior. However, some operational alterations can change the whole scenario of performance declination. These alterations can be implemented without changing the conventional model of the overall employee appraisal through making some changes in measurement parameters and tools (Larimo, Nguyen & Ali, 2016). In spite of having their current performance measurement CERA can add two additional performance management systems within their HRM practices, namely Quality approach and Result recognition approach. These recommended performance measurement approaches can help the basic performance measurement system of CARA along with their recognition, appraisal and reward procedures.
Quality approach:
Quality approach process starts from 360 degree monitoring system where the management does not judge the employee performance level only by the collected feedback from the immediate superior. Rather, in this system management applies a close and direct monitoring environment without involving any third party opinions (Järvinen & Karjaluoto, 2015). As a result, the management can have more clear and flawless idea about the performance quality of an employee and his or her potentiality. In order to implement variety of monitoring systems for 360 degree appraisal CERA can introduce some independent surveillance system in their office premises and in other operational areas. 360 degree monitoring is a multi-threaded observation technique where the management can simultaneously execute multiple monitoring tools. Therefore, in this system, CERA can have the variety of optional tools to choose the correct one for their organization.
Customizability is one of the major advantages of the Quality approach and 360 degree monitoring process. 360 degree monitoring based Quality approach can also allow them to encourage the ground level employee (Sainaghi, Phillips & Zavarrone, 2017). Some national and international companies often use a real time monitoring system by deploying a monitoring group and collecting feedback from them. The duty of this monitoring group is to monitor the employees when they are working and without any prior notice or alarming. This practice is also helpful to analyse the faults in existing work structure by collecting feedback from the ground level employees. In the Quality approach, the company not only collects the feedbacks from supervisors, the feedbacks from ground level worker’s are also prioritised for decision making process of individual performance measurement (Maruthappu et al., 2014). The Quality Approach mainly focuses on the use of Kaizen process that can consistently improve the work structure and productivity of the business organisation.
At the same time, 360 degree has some operational drawback regarding its recruitment of special workforce for successful execution of monitoring. This performance measurement system needs additional monitoring cost and workforce to get the most accurate information about the existing work environment, work structure, employee performance and operational dilemmas (Epstein, Verbeeten & Widener, 2016). All of this information is very helpful to gauge the potentiality of any individual employee or a group of employees. To avoid the additional expenditure for monitoring system CERA can depend more on online based review. In this strategy, the organisation can allow the employees to convey about their problems during the work in an online based employee forum. Then the organisation has to put all the reviews, complains and opinions together to get the valuable information about a particular employee and his or her current productivity and potentiality.
Another limitation of the HRM practices of CERA
Result approach:
Result approach is another performance measurement approach which is comparatively simple to implement than other performance measurement approaches. In result approach, the management of the company uses a periodical scoring system by including many performances measuring attributes in it (Dada, Stanoevska-Slabeva & Gómez, 2013). The popular attributes are the financial benefit, customer relation, internal operation, coordination, learning and growth. Just like a student’s scorecard, the scoring of all attributes is added in order to get the total efficiency of the employee of CERA and how much they are beneficial for the future growth of the business. Sometimes, the management of many organisation put another constraint with each attribute of this scorecard, which is weight. In this strategy, the organisation sets individual weights to individual attributes as per their influence on the overall performance of the employee (Bacon, 2012). In most of the cases, financial benefit is weighted higher than coordination attribute.
The Result approach can be applied to various practices. One of the approaches is known as Productivity Measurement and Evaluation System or ProMES. In this practice, all the employees are motivated by their leader to perform with their best, which allow the management to judge the potentiality of the employees and what could be the best technique for training and develop their skills (Kasie & Belay, 2013). In this approach, the management of any business organisation like CERA has to build a step by step workflow diagram. The diagram contains four stages namely, objective analysis, planning scorecard format, measuring employee performance and collecting feedback for the evaluation process. Sometimes these attributes differ as per different departmental activities. Before planning the scorecard format summarising the effectiveness of the selected attributes should be the major concern of a performance measurement system.
The main strategy of this scorecard based approach is to convert the performance measurement system into the performance stimulation. The employee motivation and resultant productivity are highly depended on the tone of the score sheet and the judgement process (Glykas, 2013). The selection process in this approach for CERA should be more encouraging rather than discouraging the failed individual. As a secondary development cycle, training is also a part of this approach, where any company can select the comparatively weak employee who has more potentiality than others. These employees can be highly beneficial for the company after receiving proper performance development and training programs. Additionally, this performance measurement approach allows the employer to adjust the pace of their performance measurement tools depending on their current employee strength, employee, satisfaction, financial condition and potential changes of CERA.
One of the essential disadvantages of this approach is this approach does not focus on the broader Human Resource Management aspect. This approach is suitable for only individual performance measurement and appraisal process (Torres, Gomes & Yasin, 2013). However, this process is not very beneficial for gauging the performance and efficiency of a group of employees or a department of CERA. Additionally, this performance management practice only focused on the primary stakeholder that limits the long-term benefit. Despite these disadvantages, this performance measurement approach also needs a strong evaluation and feedback collection procedure in each complication of the measurement cycle. These feedbacks are collected from the employees on whom the result measurement approach has been implemented. CERA can use this approach as a secondary approach with their conventional performance measurement approaches.
Conclusion:
From the above discussion, it can be said that performance measurement is a system of measuring the capabilities of the workforce from both collective and individual perspective that can enable the company to improve the overall productivity of by providing sufficient development and motivation within the organisation named CERA. The possible way out from their current declining condition can be identified by analysing two alternative ways of performance measurement system that can be implemented in the HRM policies. The proper identification from the analysis of the monitoring report is the most significant duties of management of CERA. As per the above discussion, it is clear that the most important dilemma of this situation it reduces the employee satisfaction level and employee to employer relationship that can cause high employee turnover and low inbound manpower from narrow labour market. Similarly, the traditional process of feedback collection from the immediate superior is not always beneficial; however, it can cause faulty recognition system.
From the previous discussion, it is clear that the human resource management of CERA majorly follows the management by the objective approach where the monitoring is conducted. In spite of having their current performance measurement CERA can add two additional performance management systems within their HRM practices, namely Quality approach and Result recognition approach. Customizability is one of the major advantages of the Quality approach with 360 degree monitoring process. On the other hand, the Result approach can be applied to Productivity Measurement and Evaluation System or ProMES. In Result approach, the management of the company uses a periodical scoring system by including many performances measuring attributes in it. CERA can also use these approaches as secondary approaches along with their conventional performance measurement approaches
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