Memo Performance Management Freamework FINAL 15Sep2014

Topics: Human resource management, Performance appraisal, Management Pages: 7 (2176 words) Published: July 26, 2015
TO: Traci Goldman, Atwood and Allen Consulting
FROM: ***************, Consulting Specialist
DATE: September 15, 2014
SUBJECT: Performance Management Framework and Recommendations, Clapton Commercial Construction Expansion

Another aspect Clapton Commercial Construction must fully consider before its interstate expansion from Michigan to Arizona, is the performance management of their employees. Performance management is a process that includes more than just appraisals or evaluations and it helps to better focus employee efforts in achieving both organizational and individual goals (U.S. Office of Personnel Management, 2014). In order to develop an effective plan, Clapton Commercial must examine the following facets. Organizational Performance Management Philosophy

It is crucial that Clapton Commercial Construction has a defined performance management philosophy. This type of philosophy provides the basis of how they will manage their people to achieve the performance the company needs in order to succeed. There are various philosophies and models to choose from and according to Garr (2012), “clearly communicating your organization’s performance management philosophy to employees matters much more than the choice of philosophy” (para. 2). Although the specific philosophy may not matter as much, I still recommend choosing one that compliments the company and what they do. Therefore, I recommend a coaching and development assessment philosophy. This model focuses on identifying strengths and weaknesses of an employee and developing them to improve performance. It also increases employee engagement and facilitates positive knowledge transfer where it enhances job performance (Cascio, 2013, p. 305). For the construction industry, this would be more ideal since new industry advancements are frequently made. Alignment to Organizational Strategy

Research says that there is a clear relationship between a company’s performance management and its financial performance (Freifeld, 2013). Clapton Commercial’s financial well-being largely depends on their employee productivity being greater than the cost of their salaries. However, compensation alone is not enough to sustain a high performance level. That is why providing continuous motivation and training is necessary. Continuous motivation and training, however; must be relevant to the organization’s overall strategies for it to be beneficial.

Three benefits of aligning performance management to organizational strategy are; increased operating margins, quicker execution of company strategy, and reduced employee turnover (Success Factors, 2014). When employees understand their goals and see how their contributions and improvements make a difference in the company’s success, they can focus on working more efficiently and become more productive. The increased productivity eventually results in greater profitability. A close alignment of strategy and goals that are visible will enable the management to more effectively allocate their resources to various projects. This allows management to reduce or eliminate effort duplication making for quicker execution, which will increase overall efficiency. Having clearer goals helps to create a sense of employee ownership in the success of a business and this leads to greater employee satisfaction and a lowered turnover rate.

I recommend the use of a balanced scorecard and “SMART” goals to achieve this. A balanced scorecard measures an organization from four perspectives; learning and growth, internal business processes, customer, and financial. It helps to clarify the vision and strategy and provides feedback on internal and external processes, as well as external outcomes to foster continuous improvement which can lead to better results. “SMART” goals are ones that are specific, measurable, attainable, relevant, and timely. This method of goal-setting has been found to effectively...

References: ACT, Inc. (2014). Policy reports 2011. A better measure of skills gaps. Retrieved from
Aguinis, H., Gottfredson, R
AutoGoja. (2011). How to perform a job analysis. Retrieved from
Cascio, W
Dessler, G. (2003). Human resource management (9th ed.). Upper Saddle River, NJ: Prentice
Freifeld, L. (2013). Establishing alignment in employee performance management. Training.
Retrieved from
Garr, S. (2012). Why performance management philosophy doesn’t matter (it just matters that
you have one)
Islam, R., & Shuib bin, M. R. (2006). Employee performance evaluation by the AHP: A case
Success Factors. (2014). The incredible power of company-wide goal alignment &
organizational business goals
U.S. Office of Personnel Management. (2014). Performance management. Retrieved from
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