Performance Management - Essay Example

Introduction Performance management can be said to be a systematic process through which a company involves its employees, as individuals and membersof a group, in improving organizational effectiveness in the accomplishment of agency mission and goals through planning work, monitoring the performance of employees, developing employee effectiveness through training, doing some kind of employee rating using as benchmark the standards set, and giving employees who perform well some kind of rewards which may not only be monetary.

Starbucks Corporation, a leading roaster and retailer of specialty coffee, deals with issues of performance management such as setting of standards by the Compensation and Management Development Committee. It has as one of their responsibilities to: “Annually review and recommend the objective performance measures and the performance targets for executive officers participating in the Executive Management Bonus Plan (whether or not such executive officers are Executive Officers) for approval by the panel of independent directors of the Board and for certifying the performance of such executive officers at the end of each fiscal year.

”1In line with this responsibility, Starbuck came up with an Executive Bonus plan whereby performing executives can make up to 70% of their base salary for meeting performance measures and company’s strategic plan annually. Those concerned with this bonus plane are “Employees serving in positions of executive vice president and above, as well as certain other senior officers of the Corporation specified by the Compensation Committee”.2 All of this is to meet the mission statement of “establishing Starbucks as the premier purveyor of the finest coffee in the world while maintaining our uncompromising principles as we grow.

”3 The mission statement is often followed through meetings of top managers of all Starbuck agencies around the world. One of such follow up meetings was held on March 10th 2008 at Seattle, where the General Manager, Howard Schultz and senior members came up with what is known as “Howard Schultz Transformation agenda communication number 10”4 in which 7 bold moves to be followed in the coming years; remain the undisputed coffee authority, re-engage into serious business and inspire Starbucks partners, re-ignite company emotional attachment with the customers, expand the company global presence while making each store the heart of the local neighbourhood, remain a leader in ethical sourcing and environmental impact, create innovative growth platforms worthy of the company’s coffee, deliver a sustainable economic model to the customers.

Top management therefore cannot achieve all of this alone. They work with the employees and are there to supervise the employees meet these set objectives and these employees are rewarded through increase wages, promotions, and in-service training. Remember that performance management is all about a group of people working to meet the goals of an agency or company, which are set as guidelines for the follow up by the superiors. In conclusion, Starbuck Corporation has a performance Management system that works through a bonus system for senior managers and executives, who in turn set out the goals to be achieved by the company through employees, who are monitored, given further training, and rewarded when the said employee(s) meets the company goals and plan.

Through this system, the company has been able to maintain her market share that has obviously kept the company competitive on the market and remaining the first coffee producing company.ReferencesStarbucks Corporation Compensation and Management Development Committee (09/2007). Retrieved from http://www.starbucks.com/aboutus/Compensation_Committee_Chart.pdf, on 12-03-2008 at 16,00pmStarbuck executive bonus plan; (November 1999)http://www.starbucks.com/aboutus/environment.asp retrieved on 13-03-2008 at 16,33pmhttp://www.starbucks.com/aboutus/pressdesc.asp?id=843 retrieved on 13-03-2008 at 16,38pm