EMPLOYEE PERFORMANCE PROGRAM PROPOSAL

A management toolBy: Florence Vorster

6 JANUARY 2016

RESEARCH REFERENCES

Employee Engagement – A guide to understanding, measuring and increasing engagement in your organizationBy: Robert J. Vance, Ph.D.

Performance Management – A roadmap for developing, implementing and evaluating performance management systems By: Elaine D. Pulakos

Society of Human Resource Management: Building a High-Performance CultureBy: ED Pulakos

Rapid Learning institute Free online Training Courses: Employee Engagement seriesTapping into Discretionary Effort The power of ValidationLeadership Focus, Capability & will

See last page for additional references

The Motivation for a new system

1. First reason- current performance program not fairCurrently a good performance is only rewarded annually. It is often difficult for supervisors and team leaders to focus on this source of motivation over the entire year without having a proper performance management system in place.

Since many of our supervisors do not assess performance across the entire year, they rely on their observations of performance in the few weeks preceding the performance reviews. Our employees are aware of this, therefore their performance becomes uneven, spiking just before reviews, giving an unrealistic view of the employee’s performance, resulting in an employee that gave the 100% from Jan too Dec getting the same reward than an employee that only started to give 100% two months before bonus reviews.

2. Secondly, the current performance program does not increase productivity or concentrates on key performance indicators Currently our department has no desired motivation to perform and increase productivity, there is no real incentive program, no possibility of a performance increase or any award other than a possibility of a bonus at the end of the year. Our current performance evaluation system at the end of the year, does not measure all important work behaviors and key performances

Once again many of our employees tend to only focus on the behaviors that are most likely to earn them a raise and bonus close to the end of the year, often ignoring other aspects of performance during the year(example: quality, output, efficiency, customer relationships etc.)

Research showed that in many cases a task that is, naturally motivating often loses this essential motivation if the “reward” is below the employee’s expectations, the individual feels there is no sufficient justification to perform the task/s according to company requirements.

Companies that rewards high performance with pay or well thought out rewards, seems to change the individual's source of motivation to perform, the trick seems to be to develop a performance program that can constantly motivate an employee to keep up the momentum of productive behavior, throughout the year.

The idea behind putting in the points program, is too measure performance throughout the year, it is based on our core goal, to have high performing and productive staff, effective supervisors and team leaders. For them to be able to receive beneficial rewards, either in form of a performance increase/merit pay, or to be able to exchange their points to up skill themselves by means on an external training course this is still to be determined.

The system must be able to excite and motivate the employees, also the system must be fair and accurate, and most of all fit in with the branding department’s culture.

New Program Proposal

PROJECT NAME: Employee Performance programProject type: Performance

management program

Proposal Date: 22 January 2016

Department Branding Project Manager: FlorenceTarget Completion: 1 March 2016 Department head Philip

Project Overview:Project Objectives :

Positive reinforcement and recognition of excellent performance during the year The merit point’s management program will facilitate and promote consistent

and timely communication regarding an employee’s work performance. Accurate and fair appraisal at the end of the year.

Business Justification: To enhance company performance the points system will be the perfect tool to improve individual performance, and a guide towards elevating work performance. By each employee to reach their personal key result areas, which will support fair remuneration for both the employee and employer.

Staff involved in the program: Admin, Printing, Embroidery

Program Technology : Automated performance management system

The Functionality to conduct and capture performance points, user interfaces for displaying performance processed information

Capturing employee input and documentation of accomplishments online

Producing automated reports that evaluate performance , low balance account and increased balance account

SMS functionality?

Possible Risks: Employees are not given a chance to earn performance points

Program is not diligently followed due to poor time management by supervisors

Employees feel that the team leaders and supervisors are unskilled at discussing their performance and are ineffective at coaching them on how to develop their skills therefore feels the program is unfair or has no interest in the program

Questions/items for further research before a full project would be approved:1. HR to investigate employee rights and lawfulness of such a program and if the

program is in line with the company’s strategies?

2. A corporate strategy and plan to build commitment

3. Define purpose for teams and clear roles4. Team and individual goals5. Set clear priorities for resources to be allocated accordingly 6. Confirm final discipline and performance steps?

7. Does this program provide the information we will need to determine annual salary increases/performance bonuses based on performance?

8. How will we prepare employees, supervisors and team leaders for the program

9. How will the incentive program and the merit program inter lock?

( example: employee is always late, has a bad attitude, but always meets his targets)

Project ScopeIn Scope: This system will be an indirect performance evaluation tool as well as a strategic tool for rewards and recognition.

Out of Scope: Infraction levels how points will be rewarded and deducted progressive discipline steps

Deliverables: Clarifying job responsibilities and expectations Enhancing individual group productivity therefore increasing profits Constantly developing employee capabilities to their fullest extent trough

effective feedback and coaching Driving behavior to align with the organization’s core value, goals and strategy Improving communication between employees and managers Increase in performance levels Fare and accurate employee evaluations and recognitions when giving

performance bonuses

Cornerstones of successful implementation

Ensure alignment with other HR systems Get organizational members on board Communicate program to Supervisors Automate ( designing a program) Pilot test? Train employees and Supervisors/Team leaders Evaluate and improve program

Performance Management Training

Description of the policies How to plan performance ,set expectation and set department goals The importance of ongoing, constructive, specific behavioral feedback How to react and act on feedback from staff in a constructive manner How to give feedback in a manner that minimizes defensiveness How to identify and address development needs How to use the automated system

Administrative rolesDivision supervisors Access to award and deduct points

Team leaders To inform supervisors of possible infractions or productive work behaviors

Department head Progressive discipline

Rough Project Timeline ** Phase: 0 – Proposal 1 – 2 – 3 – 4 – Review Date:

25/1/2016 TBD TBD TBD TBD

Performance Management program

Summary

Each branding employee will start the year on (0) in their “Points Wallet, various counterproductive work behaviors (section 1.1) will result in deductions from an Employee’s “Points Wallet”, an employee may also be rewarded with points (section 2.2)

Progressive disciplinary steps will be taken (section 3.1) based on a certain amount of a negative points balance. Should an employee deplete all points in his/her account immediate steps will be taken (Section 3.1), but if an employee manage to increase their points they will automatically qualify for employee recognition (Section 2.2)

Each time an Employee has points deducted or added from/too his/her “Points Wallet”, he/she will be notified of the reason for the deduction (as stipulated under Level 1-3 infractions), or the remuneration(as stipulated under Level 1-3 remuneration) and the total balance will reflect.

The supervisor will be able to pull a statement of the employee’s performance, this statement will reflect deductions and remunerations. The Supervisor will be able to get a broader look at the employee’s performance and with the assistance of the management team be able to create a strategy to increase the employee’s performance.

A statement of performance will also determine an employee’s performance increase/Performance award and annual performance bonus.

Example:

Date Level Description Points 01/01/2016 1 Spends more time socializing than working -102/02/2016 2 Has received complaints from team leaders -1

04/02/20162 Has made errors that have led to significant

problems -125/02/2016 3 Has little concern for details -104/03/2016 1 Often needs to redo his work -126/03/2016 HR Counseling session completed 205/04/2016 1 Performance improvement 216/04/2016 3 Comes to work ready to excel 1

The Supervisor/Administrator will on a quarterly basis, use the statement of account to see which employees is still on a (0), and investigation into the zero account balance will be done to make sure that the supervisor has not overlooked the employee’s need for professional development, or any other reasons why the employee have not manage to increase his/her performance.

Serious transgressions committed by and employee will be handled by the human recourse department. (Ref: Company Disciplinary Code)

Employees may request at any time to meet with the Administrator to review their Points Account.

1.1 Counterproductive work behavior (deduction Levels)

An employee may have points deducted from his/her Points Account for the following reasons:

Level 1 Infractions - TBC Points Deducted for each Occurrence TBA TBA

Level 2 Infractions- Result Expectations? TBC Points Deducted for each Occurrence

TBA

Level 3 Infractions- TBC Points Deducted for each Occurrence

TBA TBA

1.2 Deducting and Disputing of Points Deducted

The supervisor or team leader will notify the employee during a private meeting of the reported infraction. A reasonable time will be agreed on to rectify any counterproductive work behavior. In failing to do so, the employee will be notified during a second meeting of the points going to be deducted. This will be confirmed by a ‘letter of deduction’, and signed by the supervisor and the employee.

At any time, will the employee have the right to dispute any points that where deducted should the employee feel the deduction it is not in accordance with the guide lines of this program (section 3.1).

Disputes must be submitted in writing (Form C), and addressed to the administrator and HR. The administrator will document any disputes off points on the automated points system.

Should the Committee determine that the disputed points were not in accordance with the rules as stipulated in the first paragraph or according to program guidelines, the deducted points will be aware back to the employees “Points Wallet”. Should the Branding Manager and HR determine that the disputed points was in accordance with these rules, no further action will be necessary and the employee will be informed of their decision in a private meeting.

Example of point deduction notification Request to deduct points (Form A)

Date Employee Name

Employee

code

Description Details of Transgression

Occurrence Level

Points

2/1/2016 Florence Vorster

3089 Unsatisfactory work Performance

Provides details that are sloppy, inaccurate , or incomplete after being notified and agreed on under Level 1 infractions

Level 2 (-3)

2.1 Production work behaviors (remuneration levels)

An employee may have points added to his/her Points Account for the following reasons:

Level 1 Remuneration - TBC Points added for each Occurrence

TBA TBA TBA

Level 2 Remuneration - TBC Points added for each Occurrence

TBA TBA TBA

Level 3 Remuneration - TBC Points added for each Occurrence

TBA TBA TABA

2.2 Awarding of Points

In order for an employee to receive performance points added to his/her, account, the supervisor or team leader must send a request for recognition to the manager (Form B).The supervisor needs to be able to submit proof to support their decision to award the employee with the level of points.

Request to Award Points (Form B)

Date Employee name Occurrence level Points1 Jan 2016 Florence Excellent

Performance5

Detail Description of Employees actions

Relentlessly pursues outstanding outcomesComes to work ready to excelMaintains focus on the main event Date: Approved by: Signature: Occurrence level: Points award:

3.1 Progressive Discipline Steps

Points Balance Remaining

Action Description

? Points Negative balance notification

The employee will be required to appear before his/her Supervisor and Team leader to discuss his/her Points Account Balance and to discuss the infractions that resulted in points being deducted from his/her account and to discuss the way forward, and ways to increase the employees performance

? Points Improvement Counseling Meeting (1st Warning letter)

The employee accompanied by his/her supervisor will be required to meet with the Branding Manager and HR to discuss necessary areas of improvement in order to remain in their current position. A Written agreement must be established at this time.

? Points Appear Letter (2nd Waring letter)

The employee accompanied by his/her supervisor will be required to meet with the Branding Manager and HR for a hearing. A 2nd warning letter will be issued.

? Points Termination The employee accompanied by his/her supervisor will be required to meet with the Branding Manager and for a hearing and employee will be terminated based on bad performance

2.2 Performance points awards

Mid-Year awards

Points Remaining Action Description+ ? points Acknowledgement of

performanceA certificate will be issued for excellent performance and an additional? points will be added to “Points Wallet”

+ ? points Options to Cash in The employee will have an option to cash in his/her points for

Merit Pay ? Online/External 1 day

training course of his/her choice

Annual awards for good performance

Points Remaining Action Description+ ? points Automatically qualifies for

80% bonus Employee has no desire to excel but gets the job done

+ ? points Automatically qualifies for 100% bonus

Puts in regular effort to ensure they are good at all aspects of their jobs

+ ? Point Automatically qualifies for 120%

In addition to performing in all aspect of their jobs they contribute to the company’s bottom line

+ ? points Automatically qualifies for 130 %

Has become invaluable to the department

3.1 Program Guidelines

Employees at all levels within the department should be able to clearly understand how their job activities and the level of their performance directly contribute to the success of the organization

Employees must be evaluated on factors that are relevant to their jobs and key performance indicators

Employees must be informed about what is expected of them and the standards against which they will be evaluated in the beginning of the year, this should be reiterated to them at least quarterly or once a notification of a negative account balance is sent

Supervisors/Team leaders should be trained on the performance management process with the relevant skills that is required to implement the process effectively

Supervisors/Team leaders must document real events of effective and, especially ineffective employee performance to substantiate the deduction or remuneration of points

Supervisors/ Team leaders will be held accountable for discussing performance issues with employees and providing them with feedback in a timely manner

Quarterly performance or low account balance will be reviewed by higher-level manager and HR

Employees must at all time have the opportunity to formally comment on deduction points and will have the right to an appeal.

Managers must give desired attention to employee’s that have not managed to increase their “Points Wallet” on a quarterly basis.

Executive Decision RecordDate Approver Decision Made

Additional Research References

Performance ManagementA roadmap for developing, implementing and evaluating performance management systemsBY: Elaine D Pulakos

Employee Performance: The Vital Behaviors of Top Performersng.monster.com/hr/hr-best-practices/workforce-management/employee-performance-management/improving-employee-performance.aspx

Organizational Psychology: A Scientist-Practitioner ApproachBy Steve M. Jex, Thomas W. Britt

Article: Employee Appraisal and performance managementArticle: Skills and requirements Employers wantDummies.com http://www.dummies.com

Int, J . Businees Performance Management PaperPublished paper

Forbeswww.frobes.comArticle: 14 Bad habits that can cost you your jobBy: Jacquely Smith Forbes staff

Human Rights CommissionManaging performance and discipline http://www.ohrc.on.ca/en/iv-human-rights-issues-all-stages-employment/11-managing-performance-and-discipline

Human ResourcesArticle: Merit Pay Planning and Implementation Guidehttps://www1.umn.edu/ohr/prod/groups/ohr/@pub/@ohr/@toolkit/documents/asset/ohr_asset_454690.pdf

Management Mind ToolsArticle: Dealing with sloppy workMind Tools https://www1.umn.edu/ohr/prod/groups/ohr/@pub/@ohr/@toolkit/documents/asset/ohr_asset_454690.pdfTerryberry Recognized Award Points, Employee recognition http://www.terryberry.com/programs/milestoneformal-recognition/awardpoints-performance-recognition.aspx

BizFilingsArticle: Workplace Rules, Protect your Business and maintain a positive employee environmenthttp://www.bizfilings.com/toolkit/sbg/office-hr/managing-the-workplace/workplace-rules.aspx

Chron Article: How to create an Employee Reconition program http://smallbusiness.chron.com/create-employee-recognition-program-40392.html

You earn itArticle: Employee Recognition Program: Connecting Behaviors with company core values Yohttp://youearnedit.com/blog/employee-recognition-programs-connecting-behaviors-with-company-core-values/uearnit.com

Awards NetworkArticle: Employee incentive programshttp://www.awardsnetwork.com/employee-reward-programs/employee-incentive-programs

HB Engagement Article: Exploring Employee incentiveshttp://www.awardsnetwork.com/employee-reward-programs/employee-incentive-programs