Performance Management System at the Colbran Medical Institute - Case Study Example

Performance Appraisal and wider performance management system at the Colbran Medical Institute Introduction The role effective human resource and the human resource management plays in an organization are important and are associated with increased performance and improving the competitiveness of an organization. The two are the most reliable and consistent asset to an organization (Peiseniece, 2009). To ensure high performance, modern business organizations are establishing human resources that are unique, quality, incomparable, non-substitutable and that are motivated and committed. More often than not, management personnel and organizational leaders may assess the performance of those working under them and use of inadequate systems to guide the assessment of performance may compel the management to review performance unofficially, casually and arbitrarily. Assessment of performance is also, referred to as performance appraisal. Performance appraisal is an essential element in motivating employees, improving the conduct of employees and safeguarding against un-productivity. Performance appraisal is supposed to be unbiased, objective, reliable, legal, and accurate (Rao, 2004). Appraising performance is vital in analyzing productive and non productive workers, assessing conduct of employees, assessing the reward outcomes, strengths and weaknesses of employees and it helps in identifying areas that need more focus and employee training (Grote, 2002). This report will critically analyze the role of effective performance management in the future success of the Cobran Medical Institute. The report will define performance management; discuss the components of performance management and analyze performance appraisal issues at Colbran Medial Institute. In addition, the report will offer recommendations and proposals for change and Performance Appraisal System at Colbran Medical Institute and offer reasons why the selected performance appraisal systems have been, chosen. Performance management Performance management entails proper planning, organizing, and overseeing and rewarding work performance for the labor forces. Performance management comprises of systems and activities that guarantees anticipated outcomes are continuously, attained effectively and efficiently (Murphy & Cleveland, 1995). Performance management deals with improving the productivity of an individual employee, work processes, a segment of the organization, the entire firm as well are production infrastructures among others. Through effective performance management systems, the human resource management is able to improve the commitment of employees that increases the chances of retaining trained, valued and skilled employees. Commitment of employees to the assigned tasks and working towards achieving the goals and objectives of the organization are, influenced by affective, continuance and obligation commitments (Gellatly, et al., 2009). To initiate voluntary employee commitment and to enhance work performance, the human resource management has no option but to align the goals and objectives of the organizations with the goals and objectives of the labor force. This is an attribute of effective performance management. Components of performance management The purpose of performance management to an organization and to its internal environment is to help establish the training needs of the labor force and offer the labor force a chance to review and reflect on their work performance (Grote, 2002). It is useful in developing standards for giving rewards, it helps the organization analyze its strong, weak points and point of opportunities that can be used to enhance performance and improve the efficiency and competence of employees in carrying out their assigned duties. There are varied components of performance management that ensures the process is not compromised, biased and unfair. Additionally, the components ensure that performance management systems used promote commitment of employees (Murphy & Cleveland, 1995); they do not infringe on the rights of workers, promote low job satisfaction and low levels of employee motivation that leads to increased employee turnover of qualified, skilled, able, knowledgeable and trained employees a) performance appraisal Performance appraisal refers to the process of establishing a structured official association between the leader and the subordinate, which is carried out at specified duration of time for instance it may be yearly or semi annually (Grote, 1996). During the process, the performance of the worker in terms of productivity, quality and efficiency is, analyzed, reviewed, with the sole intention of establishing the strong and weak points of the employee and identifying prospects for the employee to develop their skills, experience and abilities and knowledge. Performance appraisal can be, utilized by the human resource management to create a foundation for making integral decisions affecting employees such as promotion of employees, rise in salary packages, incentives and stipulating disciplinary actions (Sandler & Keefe, 2003). It is a system of easing flow of communication among and between labor forces and the management (Murphy & Cleveland, 1995). Through performance appraisal the human resource management is able to form of effective human resource strategies, it helps in validating the hiring and firing methods and it is a fundamental element in enhancing the work performance, which is, done by employee counseling, training and development done after the performance appraisal has been, finalized. At Colbran Medical Institute, there is implementation of performance appraisal to assess the performance of workers. The move is commendable as it shows the management is interested in tracking the strengths and weaknesses of its employees to be able to come up with better work processes and systems to improve performance. Performance appraisal should be, pursued by a feedback to the employees in order for the employees to understand what they are doing right and where they are going wrong (Grote, 2002). Mr. Allan, the Colbran’s human resource manager does bring feedback to the team’s supervisor Isabel. However, the type of performance appraisal they are using (the graphical rating scale), is limited. This is because, it only captures general information and cover up small but important details that indicate issues such as absenteeism of workers, work-related challenges, inability of some workers to carry out assigned duties, standards and levels of work performance, reduced work competence and level of commitment by workers. The method of feedback used by the Colbran’s human resource manager is unprofessional and unstructured. He begins discussing the important issue of performance appraisal in an informal manner. When dealing with a serious issue such as details regarding performance of employees, the human resource need to offer better leadership and guidance in order to achieve the goals and objectives of the organization. This necessitate calling staff meetings with the supervisor and the employees and thereafter, analyzing the strengths of the appraisal systems that currently in use, and when the weaknesses are more than the strengths, the employees and the management can consult on the best performance appraisal systems used. This not only indicate professionalism, but it motivates the employees to take performance appraisal seriously, own the set targets, initiate team work, which has the impact of promoting positive and increased performance of work processes and operations. Performance appraisal at the Institute should estimate the work performance and giving feedback directly to employees and not to the Supervisor as Allan did. This is because it is the responsibility of the HR to communicate concerns, issues and changes to employees. Feedback is very important in this process as it has the potential to alter negative, investigative, biased appraisals to positive, consultative and objective appraisals (Rao, 2004). Quality feedback does not only analyze the weak points of workers, but it highlights their strengths and helps them improve on their weaknesses. b) training Effective work performance is, generated by having a labor force that is not only talented and qualified, but also is equipped with skills and knowledge (Kirkpatrick, 2006). Since contemporary business environments, concepts, theories and systems are always coming up, the employee need to be, coached on these new skills in order for the workforce to remain relevant to effectively and efficiently carry out their duties. Training acts as an orientation system to familiarize the employee with the mission, goals and objectives of the organization and at the same time, to learn the working policies, standards, structures and values important to the organization (Peiseniece, 2009). By so doing, the employee is able to understand, what it is, expected of them to do. At Colbran Medical Institute, the Supervisor Isabel seems not to understand the HR’s point of concern about an appraisal system that does not capture actual figures on a worker’s productivity. She is satisfied with the way things are. Through training, she and others may be able to understand the essential role performance appraisal and other human resource activities plays in ensuring strategic HR and corporate goals are, achieved. This is especially so as the Colbran’s HR explains, when the performance appraisal is connected with remunerations and performance. Employees at the Institute need adequate training on how to fill in the performance appraisal and why as it stands, the institution may require changing the present performance appraisal scale or discarding it for a more sophisticated system or a combination of appraisal systems. Additionally, they need to be, taught that there are consequences to distorting facts in appraisal systems. This will be important because, presently, the work team feel they are doing a good work and are result oriented and they would not feel appreciated when a new systems is suddenly introduced. Effective performance management allow employee training in a bid to improve the performance identifications (Grote, 1996). The HR is able to create new assignments and assign increased levels of accountability to workers by training them and promoting their skills and knowledge. Training is essential in equipping workers with work-related, rank-associated and organization related information and fully understanding the needs and expectations of the customer to effectively satisfy them (Sandler & Keefe, 2003). c) development Employee development entails the HR taking the initiative to understand the employee as an individual and thereby, developing and implementing improved work processes that allow the employees to develop and grow not only in their professional lives, but also in their personal lives (Grote, 2002). The employee should be, given an opportunity to balance their personal and professional lives. Development can be, facilitated by offering financial and job security to ensure the employee basic needs are, met and at the same time, they have enough resources to safeguard their financial future. Offering job security as a development technique ensures more commitment, accountability and ownership of the duties assigned to workers (Peiseniece, 2009). Providing favorable working conditions such as high occupational and health standards, offering the employees necessary opportunities to grow such as encouraging innovation and creativity and designating higher levels of accountabilities such as challenging tasks and offering promotion by merit are effective ways of developing the labor force. Developing employees also acts as a motivational technique. A work environment where workers are, allowed to experiment, make mistakes and learn from them is a fertile ground for employee development (Kirkpatrick, 2006). Training and development are vital in improving work performance, enhancing competencies and helps employees to easily, accommodate change such as integration of new systems and technologies (Razouk, et al., 2009). Through training and development, employees at Colbran would eagerly accommodate and promote the necessarily changes required to measure up and introduce new appraisal systems. d) Remuneration Remuneration for workers is more often than not, determined by the amount of work and responsibilities a worker carries out (Ahmad, 1998). Remuneration is equivalent to the employee’s work performance. Offering high remuneration to an employee with low work performance encourages unaccountability, laziness and it de-motivates the workers with high performance who may feel that their efforts are not recognized and therefore, resort to laziness that may sabotage the organization since, it will not be able to meet targets and attain anticipated goals and objectives. Good remuneration can be, used to attract and retain the best work performers, who have high levels of dedication, skills, abilities, knowledge and experience. At the same time, remuneration are useful in motivating workers to improve their performance, work harder and be committed to achieving set goals and objectives. Majority of employee turnover is, influenced, by the amount of money, benefits, bonuses and incentives they get. Good remuneration should not only help the employee meet their basic needs, but also it should be enough to allow them to save and invest when they want to (Ahmad, 1998). The Colbran Medical Institute uses performance appraisals as standards for gauging which employee get what based on their ratings on the appraisal systems. Among key areas to analyze when linking performance appraisal with pay is, examining the numbers of days and hours worked and examining the rate of absenteeism, based on the number of days in a month, the employee reports to work and actually carries out their tasks (Murphy & Cleveland, 1995). In addition, the productivity of each employee, proceeds per worker, profit for every worker, efficiency and effectiveness of an employee to meet set targets and the number of hours an employee works overtime among others. For effective remuneration systems, the Colbran Medical Institute need to formulate and implement a combination of new and sophisticated scale systems to effectively review work performance for their workers in order to capture the rate of productivity and proceeds of each employee. This will ensure high performing individuals are well paid while non-performing individuals are identified and correct measures are taken to either improve their performance or their contract be terminated. Other components of performance management includes establishing clear job descriptions and job specifications during the recruitment and selection processes and choosing the right candidate to fill the right position at the right price (Mathis & Jackson, 2008). In addition, discussion on the needs and achievement-based performance principles, results and measures and facilitating exit interviews to help shade light on the reasons valued, skilled and committed workers terminate their employment contracts or resigns (Razouk, et al., 2009). Remunerations for contemporary organizations should be comparable and competitive enough to help attract and retain valued employees (Gellatly, et al., 2009). This should be, pursued with systems that foster voluntary employee commitment, since, an organization runs the risk of training, developing and paying the employee well and losing them to competitors. Commitment from workers therefore, is not an option. The most effective way to retain and increase commitment for workers according to (Gellatly, et al., 2009), is to increase continuance commitment which is the worker’s analysis of the personal costs and gains of remaining or quitting the job and improving the affective commitment which is the worker’s emotional connection to, identification with and their contribution to the organization. Effective performance management is, characterized by increased accountability by workers to achieve set goals and objectives, improved trust, enhanced innovation and creativity by workers, reduced rates of absenteeism, increased levels of job satisfaction and increased level of employee morale. More often than not, increased communication flow between the management and the labor force through the human resource management leaders and systems, increased team work, increased interrelationship among workers and positive responses from the customers who are effectively and efficiently satisfied by the quality performance and services offered by the workers (Mathis & Jackson, 2008). It is important to note that, the approaches to performance management and performance appraisal systems that are, used by an organization depend on the organization’s general HRM planning. Colbran Medical Institute needs to invest in performance management structures and appraisal scale systems that work for the Colbran’s employees. The systems used should be, agreed upon by the management and the workforce to improve its effectiveness through consultations. Performance appraisal issues Implementing performance appraisal is not an easy process and it requires skill and delicacy to enforce it. There are numerous challenges that face organizations when developing and implementing the right and competent performance appraisal systems. Among the challenges includes selecting the appropriate and relevant evaluation criteria (Grote, 1996). The criteria chosen for implementation should be quantifiable and should correspond with the objective set for developing a performance appraisal. The other challenge includes lack of competence by the management. The management may not be qualified enough to decide the appropriate criteria to use. At Colbran Medical Institute, selection of an inappropriate selection method has resulted in elimination of important details instrumental to deciding the remuneration for workers. The management should be, trained accordingly to ensure they are able to carry out appraisal processes fairly, professionally and without bias. Errors in rating and appraising are the other challenge that is, manifested through halo effects and labeling, which may result in unproductive and weak employees feeling victimized (Murphy & Cleveland, 1995). Employees and labor unions may oppose implementation of performance appraisals systems in the workplace citing negative ratings by the management. The challenge can be overcome by communicating the aim of the appraisal process and appraisal standards to the employee and thereby, workers are able to comprehend what they are, expected to do. At the Colbran Medical Institute, the main performance appraisal issues that are eminent are selection of inappropriate evaluation ratings. Currently, the institution uses graphical ratings scale, which is not as effective and efficient as the human resource department would want it to be as mentioned by the HR manager Mr. Allan Matters. The manager states the rating used does not detail sufficiently the needed parameters. The graphical rating scales used for the Institute offer unclear and vague on the standards and levels of work performance. The other performance appraisal issues at the Colbran’s are leniency and central tendency. They are, compounded by probable distortion of appraisal systems. The rater scale indicate the team led by Isabel, are performing exceptionally well without any impediments. This is particularly false as she mentions that once in a while she have had to chip in or a team member has had to owing to low performance and un-productivity of one of the teammates. Isabel believes her team works hard as a team and they are able to deliver, this has impaired her objectivity as illustrated by her consistent marking of excellent and good on the appraisal sheets. The emerging leniency and central tendency, where the rater assesses workers on the middle point results in inaccurate information recorded on the appraisal systems (Murphy & Cleveland, 1995). Since Colbran Medical Institute use performance appraisal as a means to rate pays, it needs to be careful as this may result in the issue of remuneration eclipsing the other important aims and objectives of performance appraisal, workers may begin to hold back negative information about performance in a bid to attract high rewards and thus, costing the organization. there is increased chances of less open appraisal discussion and workers may be susceptible to adopting conduct of putting more efforts on work processes that would generate good ratings instead of improving their actual performance in general which is fundamental to ensuring effective and sustainable work performance management. Recommendation of a Performance Appraisal System and reasons for choosing it The most appropriate performance appraisal system for Colbran Medial Institute is the 360-Degree Feedback, which involves appraisal of the employee’s performance confidentially and anonymously from those people, the employee meets on a daily basis (Eckerson, 2010). Among persons used to rate, the employees include colleagues at work, their superiors who may include managers and supervisors, subordinates, peers, the organization’s customers and clients, marketers and suppliers to the organization. The 360 Degree Feedback systems are important in offering valuable varying perspectives and information relating to the performance of a worker. The systems is particularly unique and significant to Colbran’s as employees are offered a chance to participate in the process, appraise themselves and understand what the superiors, subordinates and other stakeholders perceive of their performance. This type of systems is not prone to biasness, leniency and unfairness as ratings are, formed from accumulation of varied views and assessments (Eckerson, 2010). This performance appraisal system is a potent developmental tool for the employees. Appraising using the 360-Degree Feedback at regular periods allow the management and the employee themselves to follow up on changes on the views and opinions of others on their performance. Conclusion Performance management is an essential management practice for contemporary organizations and institutions. Performance management comprises of systems and activities that guarantees anticipated outcomes are continuously, attained effectively and efficiently. To facilitate effective performance management the human resource management, develops and implements performance appraisal to be able to analyze the productivity and performance of workers. Performance appraisal refers to the process of establishing a structured official association between the leader and the subordinate, which is carried out at specified duration of time for instance it may be yearly or semi annually. During the process, the performance of the worker in terms of productivity, quality and efficiency is, analyzed, reviewed, with the sole intention of establishing the strong and weak points of the employee and identifying prospects for the employee to develop their skills, experience and abilities and knowledge. The report has critically analyzed performance management and appraisal systems at Colbran Medical Institute and has offered recommendation of the appropriate performance appraisal systems the institute should use. The recommendation is the 360 –Degree Feedback. References Ahmad, S.M. (1998). Performance Appraisal Management. New Delhi: PVT. LTD. Eckerson, W.W. (2010). Performance Dashboards: Measuring, Monitoring, and Managing Your Business. 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