4HRD Part 2: PERFORMANCE AND REWARD MANAGEMENT
Performance and Reward Management of a High Performer
Table of Contents
4The features of best practice in performance management that could be effective in motivating and retaining high-performing employees 2.1
4Alignment with goals and vision of the business and individual employees 2.1.1
5Inclusive planning and goal-setting 2.1.2
6Integration of human resource development (HRD) function with the performance management function 2.2
6Specific issues surrounding the management ‘high performers’ that need to be taken into account generally in an effective performance management system 2.3
6Challenging and involving job design 2.3.1
7Need for relevance and autonomy 2.3.2
7How the case study organization’s reward management strategy fits into the solution offered in 2.3 above. 2.4
8How the case study organization’s human resource management practices (HRD, performance and reward management) should support the firm’s corporate strategies 2.5
Every strategic planning process in organisations must be aligned with a strong emphasis on improving and exploiting the human resources available to the organisation[ CITATION Eis13 l 1033 ]. Human resource is one of the most valuable assets in organisations that can be relied on to deliver growth and profitability. It is critically important to motivate and train employees for better performance since organisational effectiveness is directly linked to the human talent and the extent to which it is exploited successfully by management[ CITATION Hop12 l 1033 ]. One of the core objectives of performance management is to enable employees perform at their optimum levels by equipping them with skills, resources and providing an enabling environment. While most of the research has focused on human resource interventions to improve the performance of under-performing employees, a few authors contend that organisations are continuously faced with the challenge of motivating and retaining high-performing, ambitious and creative workers[ CITATION Bea09 l 1033 m Kag10 m deW07]. Performance management should, therefore, not be narrowly interpreted as an effort to improve poor performance in employees, but rather an initiative to manage both poor and good performance to the benefit of the organisation.
This report analyses the best human resource (HR) management practices that can be relied on to sustain the level of productivity that a business enjoys from high-performing employees. The paper will highlight key performance management issues related to motivation and retention of highly performing employees. The report will review previous research findings on the subject of managing high-performing employees with a view of critically analysing the case study situation. The report will particularly be concerned with organisational practices that motivate and retain high performing employees to be productive and instrumental in effective implementation of corporate strategies.
One month after a high-performing, 31 year old employee was hired in a crucial management position, he feels out of place, bored and unchallenged. He has expressed an intention to look for a new job that is more exciting and rewarding to him as an ambitious person. The manager believes the employee contribution is highly important to the future of the organisation and would prefer to motivate and retain him instead of letting him go. The purpose of this report is to analyse the best performance management practices with a view to recommending a solution to this unique case situation. The report will provide recommendations of actions that the human resource may take to motivate and retain the high-performing employee.
The features of best practice in performance management that could be effective in motivating and retaining high-performing employees
Alignment with goals and vision of the business and individual employees
Every business should have a strategic plan that guides its operations and activities. A strategic plan should also guide all the important functions of a business including human resource planning. It follows then, that performance management as a key human resource activity should be strongly aligned with the strategic goals and objectives of the business. Highly performing employees need to perceive that their contribution to the organisation goes beyond their routine tasks. This is consistent with Risher (2011) argument that employees need to be strongly attached to the vision and goals of an organisation. By aligning an employee’s vision with that of the organisation, there is a high likelihood that the employees will exhibit high levels of commitment and exuberance to achieve both visions[ CITATION Bea09 l 1033 ]. Sahoo & Mishra, (2012) also argue that a higher salary package might not be as effective in motivating ambitious employees to perform as aligning an employee’s ambition and those of the organisation in pursuit of success.
Inclusive planning and goal-setting
An effective performance management initiative must involve both the employees and management in defining expectations and setting goals and objectives[ CITATION Arm05 l 1033 ]. Such a plan should consider the performance expectations of every task in the organisation in light of the collective vision of the organisation. The participation of employees is critically important to the successful implementation of performance programmes. According to Panda (2011), high-performing employees are particularly very creative and normally desire to work in an environment where they have a great sense of autonomy and participation in determining their job design. It is prudent, therefore, to involve such employees in setting goals and performance expectations. Such a planning process allows the employees to understand the strategic goals and objectives of the business and align them with their own ambitions. Extensive involvement of employees also provides a crucial avenue where they can propose ideas to make their job challenging and exciting to them thus eliminating the problem of lack of motivation and enthusiasm at work[ CITATION Sam11 l 1033 ].
Integration of human resource development (HRD) function with the performance management function
Performance management and the human resource development function go hand in hand in improving the productivity of an organisation through effective management of the human capital. As noted by Beauregard & Henry, (2009), human resource development functions can enhance performance management in organisations in several ways. For example, an effective recruitment and training program that is strongly aligned with the strategic goals of the business ensures that there is a skilled and competent workforce that is likely to respond positively to performance management programmes. Human resource managers should also consider employee productivity and performance in developing reward and recognition programmes to motivate employees. Human resource development function should also provide growth opportunities and career advancement options that are well integrated with the performance management goals and objectives. Essentially, employee performance should constitute a key consideration in all the human resource development undertakings[ CITATION Sam11 l 1033 ].
Specific issues surrounding the management ‘high performers’ that need to be taken into account generally in an effective performance management system
Challenging and involving job design
. According to the Maslow’s hierarchy of needs theory, people are constantly motivated to meet needs. Once a certain need has been met, they seek to fulfil another one which is normally on a higher level. High-achieving employees are no longer motivated by good salaries and job security as they have already met such needs. They are motivated by challenging and exciting job designs. They are bored by routine jobs that do not bring them out of their comfort zones[ CITATION Har141 l 1033 ]. It is important, therefore, that human resource managers review the job of a high achiever regularly to introduce new challenges and goals.
Need for relevance and autonomy
High performing individuals always want to be in control of all aspects of their lives, including work[ CITATION Hop12 l 1033 ]. They prefer dictating the terms of engagement at work. It is important to that management allows such people an enhanced degree of autonomy and influence in their jobs. For example, management should involve a high performing employee in designing his job and reviewing the strategic objectives of the business. Highly performing employees desire a situation in which they suggest improvements or adjustments in job assignments, organisational processes, scheduling and performance measurements[ CITATION How11 l 1033 ]. Highly performing employees feel their job is challenging and exciting whenever they feel that they have a high degree of autonomy and influence at their work. However, management should ensure that the employee’s individual objectives are consistent with the strategic vision of the business[ CITATION Elo16 l 1033 ].
How the case study organization’s reward management strategy fits into the solution offered in 2.3 above.
The organisation’s reward management strategy is strongly aligned with the strategic vision of the business. The reward system is anchored on the assumption that an employee should be rewarded and recognized for helping the organisation reach its reach its strategic objectives through their efficient and effective performance of tasks. However, Sahoo & Mishra (2012) caution that a reward might not always lead to performance improvement in the future. However, it should be viewed as a gesture of appreciation of the good performance that an employee renders to the organisation. A reward is the fulfilment of an implicit psychological contract between an employer and the employee. An effective performance management system should focus on rewarding individuals as opposed to teams in order to meet the different psychological expectations of each employee[ CITATION Har141 l 1033 ]. Recognition is a more impactful in motivating an individual to perform better at their work as compared to reward. Recognition systems work better in a mutually agreed design to avoid perceptions of bias and favouritism[ CITATION Bea09 l 1033 ]. Both reward and recognition should be aligned with the organizational goals and vision. For employees to be rewarded and recognized, they have to understand the vision and goals of the organization and strive to achieve them[ CITATION Sam11 l 1033 ].
How the case study organization’s human resource management practices (HRD, performance and reward management) should support the firm’s corporate strategies
The firm’s human resource management practices should be guided by a solid plan that is aligned to the corporate strategies of the business. This means that human resources functions should be regarded as important considerations during the development of the firm’s strategic plan. For example, the recruitment, training and remuneration of employees should mirror the commitment of the firm towards integrating their workforce into the strategy implementation process. The performance and reward management policies should also be aligned with the strategic vision of the business. Employees should have flexible job designs that consider their personality and career objectives. Such jobs should also be designed to help the organization achieve its objectives through efficient performance of tasks by employees. Employees should be rewarded for helping the organization achieve its strategic vision. It is critically imperative, therefore, that employees have a good understanding of the strategic vision of the firm and their role in helping the organization achieve the vision[ CITATION Eis13 l 1033 m deW07].
The analysis and literature reviewed in relation to the case proves that motivation is an important contributor to employee productivity at work. High performing employees are particularly motivated by challenging but exciting job designs that give them an enhanced degree of autonomy and influence at the work place. It is important involve high performers in strategic planning so they may appreciate the vision of a firm and align their career ambitions around it. High performing employees should be involved in developing their job designs for them to provide ideas on how their jobs can be exciting and rewarding to them and the business. Apparently, the organization must align its performance & reward systems and the human resource development functions with its corporate strategies.
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