Improving Performance Management at Elite Travel Solutions - Case Study Example

Improving performance management through the development of a High-performance culture at Elite Travel Solutions School: Introduction From HR Director: To: Senior Management of Elite Travel Solutions The effective management of employee performance is a major aspect of effective organizational leadership. Previous research has shown that the managerial officers that manage employee performance effectively lead to the production of exceptional business outcomes, as compared to those who did not. The Ken Blanchard Companies (2009) discussed that the practice has led to the reduction of staff turnover by half, customer satisfaction increased by between 10 and 30 percent; employee commitment increased by 40 percent and the profitability of the businesses doubled. However, many businesses/ companies do not realize the benefits, mainly because many stakeholders in the organization view performance management as an administrative role. This is the case, due to the fact that it has a lot to do with helping managers to make the decisions related to pay, allowing the organization to address the problems of poor performers and sourcing for all necessary information (Gueutal, Marler & Falbe, 2007, p. 10). Through the survey of the workers of Elite Travel Solutions, less than 30 percent of the managers and the employees reported that the performance management systems in place covered three main areas. The three main areas included the setting of goals, the provision of feedback, and improving the performance of employees. This paper will explore the strategies that will enable the senior management of the company to embed leadership development in the organization, so as to promote change management and the input of workers in change management. Procedure and Methodology The study was administered among a sample of 10 executive managers of 5 organizations pursuing best practices. The managerial staffs were surveyed using semi-structured interviews, seeking to describe the delivery of their leadership development and the contents of their leadership development. The 10 executive officers were interviewed on the engagement of managerial staffs and other employees during the leadership of the organization, and the ways they increase value-development in building the leadership system, beyond the roles of consultants, development specialists and academics. The use of semi-structured interviews was used, in order to ensure that the information was collected in a consistent and scientific manner, and that the information collected was specific to the different managerial staffs. The information collected from the executive managers will help the researcher in defining and classifying their organizational culture, in relation to the improvement of performance management through the development of a High-performance culture at the organization. The information collected from the sampled managerial staffs will be used to test the hypothesis on the role played by leadership management in change management. The hypotheses to be verified through the study and to inform the management of company include: Linking leadership development to change management improves employee buy-in of organizational change. Through the development of leadership competency, reward strategies and change management, talent development and employee retention levels will be increased. Findings from the study The 10 executive managers of 5 companies interviewed during the study reported that performance management has not been effectively administered in the past, and even in some cases, questioned its validity as a performance improvement model. The problems cited by the different executive officers, as likely to hamper the effectiveness of performance management include that, the performance management systems used did not entail the explicit setting of goals. The sampled managers also reported that the managers and the employees that had not collected feedback regarding the changes arising from the strategy, was among the areas that limited the improvement of performance (Huang & Cappelli, 2010, p. 214). This leads to the conclusion that the leadership development of the employees of the company should entail the training of employees on goal setting and the importance of providing feedback should be emphasized. Apart from training employees on the two core areas, it is important to set the rewards that will enforce their adoption of the strategies, during their execution of work. The evidence from the study showed that the managers reported using performance management to improve change management in organizations, through fostering talent development, which increased employee retention levels. Taking into account the variety of negative perceptions held by organizations in relation to performance management, the sampled executives reported that the administration of the process effectively increased engagement levels, improved organizational performance and increased employee retention (Huang & Cappelli, 2010, p. 215). The executive managers reported that changing the focus of the strategy was the main ingredient of the process, needed to guarantee its success, by addressing organizational behaviours first. Through streamlining the behaviours of employees and managers, it becomes increasingly possible to position the performance management process, towards ensuring that it supports and reinforces the favourable behaviours needed to foster the success of the organization. In the past, many managers have deployed performance management like a formal appraisal model, but there is a need to position the process like an everyday aspect of the organization’s high-performance culture. Common strategies and the causes for failure Many of the organizations that have initiated performance management have focused on the development of improved rating processes and tools – including rating criteria and formats, using disparate outlooks and process steps. The implicit assumption in this outlook is that carefully administered steps and specific tools in the system leads to effective performance management. The problem with this outlook is that performance management is viewed as an administrative drill lacking real value (Pulakos and O’Leary, 2011, p. 146). Further, the negative attitudes of employees and managers about performance management models have hindered the usage of these systems to improve the performance of organizations, and that has called for the continuous reinvention of the models. Despite the fact that these systems are used to drive the adoption of effective behaviour; in many cases, they end up triggering occasional activity over long periods of time. This lesson should be the guideline for the changes to be incorporated into the leadership development, where the oversight team should ensure that all groups are constantly inputting performance management efforts. The poor administration of performance management Advice offered to senior management There is an assumption that performance management aids the managers of an organization during pay decision-making. The reality is that performance ratings do not offer enough information, which can allow managers to distinctively differentiate between the performances of employees. As a result, it cannot be used during the formulation of pay gradations, unless the management uses forced distribution. The outcomes foreseen from the strategies proposed include increasing employee retention, increasing the competence of leaders, improving change management and proposing a reward strategy that fosters employee retention and talent development (Harvey et al., 2007, p. 264). The inability to differentiate between the different employees leaves organizations vulnerable, where there is no explicit relationship between the high ratings of employees and the variable pay offered to them. It is important to take into account that, pay increment should be done on the basis of many factors beyond the performance of employees (Pulakos & O’Leary, 2011, p. 147). There is the assumption that performance management offers an organization, the information needed to defend itself in different circles. The fact is that documentation is required to support administrative decisions, including separations, promotions and pay raises – while still accounting for challenges. However, performance management models are not effective in justifying the alignment of ratings with outcomes (Bryant, 2011, p. BU 1). The fact remains that the information generated through performance management processes is usually more useful to the employees seeking to challenge an organization, as compared to the organization in defending itself. There is an assumption that performance management offers the model for dealing with poor performers. The fact is that, performance management systems are not sufficient in dealing with poor performers, like opportunity periods and performance improvement plans, after a performance management model is set for employees (Bryant, 2011, p. BU 1). Reward strategy for retaining employees and developing talent at all levels The rewards strategy employed at the organization should not be a one-size-fits all affair. This is particularly true, taking into account that the workers of Elite Travel Solutions are a multi-generation workforce. From a strategic point of view, the salary offered to the employees should be aligned with industry standards, the organization should hire from sources that will not compel it to pay salaries that are beyond the threshold that will allow it to remain profitable (Mitchell et al., 2001, p. 1102). Secondly, benefits should be used together with the salary, because it is important for workers to enjoy benefits, irrespective of the financial pressure facing the company. Some of the benefits that can increase the attractiveness of the company to employees include retirement and health benefits. Thirdly, it is important for the organization to adopt a customized rewards strategy. Such a strategy will satisfy the needs of different employee groups; for example, the younger employees are more interested in employee development and training programs (Marler, Liang & Dulebohn, 2006, p. 722). On the other hand, the older may prefer to get trained about different aspects of their work, so that they can enjoy their work more. Conclusion The study narrowed-down the gaps between science and practice, by dispelling the assumptions related to performance management, employee retention and turnover. The areas identified were meant to improve the organizational culture of the company, to increase ability to perform in the current environment and to increase the retention of employees of different groups. Most importantly, it was pointed out that performance management and development should be a continuous process employed at all times. Recommendations a) It is important for the company to redefine and streamline HR processes, during the implementation of organizational change. b) Automating basic HR roles and tasks using support programs can foster the quality of managerial decision-making (Bauer et al., 2004, p. 135). c) Communication between employees and managers is very important, because it increases the support received from them, about changes and developments. d) Employee empowerment is an important part of all change processes and organization development systems. References Bauer, T. N., Truxillo, D. M., Paronto, M. E., Weekley, J. A., & Campion, M. A. (2004). Applicant reactions to different selection technology: Faceto-face, interactive voice response, and computer-assisted telephone screening interviews. International Journal of Selection and Assessment, 12, 135-148. Bryant, A. (2011). Google’s quest to build a better boss. The New York Times, p. BU 1. Gueutal, H. G., Marler, J. H, & Falbe, C. M. (2007). Skill sets for the e-HR world. IHRIM Journal, XI (2), 9-15. Harvey, P., Stoner, J., Hochwarter, W., & Kacmar, C. (2007). Dealing with bad bosses: The neutralizing effects of self presentation and positive effect on the negative consequences of abusive supervision. Leadership Quarterly, 18, 264-280. Huang, F., & Cappelli, P. (2010). Applicant screening and performance related outcomes. American Economic Review, 100, 214-218. Marler, J. H., Liang, X., & Dulebohn, J. H. (2006). Training and effective employee information technology use. Journal of Management, 32, 721-743. Mitchell, T.R., Holtom, B.C., Lee, T.W., Sablynski, C.J., & Erez, M. 2001. Why people stay: Using job embeddedness to predict voluntary turnover. Academy of Management Journal, 44, 1102-1121. Pulakos, E. D, & O’Leary, R. S. (2011). Why is performance management broken? Industrial and Organizational Psychology, 4(2), 146-164. The Ken Blanchard Companies. (2009). The high cost of doing nothing: Quantifying the impact of leadership on the bottom line. Escondido, CA: Author. Read More