BSBLDR501 - Performance Management Report: Strategies for Leaders

This report delves into the critical aspects of performance management, aiming to enhance management personnel's awareness and practical application in the workplace. It covers a wide range of topics, including the definition of performance management, leadership competencies, and strategies for managing employee performance effectively. The report explores the performance management cycle, including planning conversations, mid-cycle reviews, and end-cycle appraisals, emphasizing the importance of aligning systems, resources, and people with strategic objectives. It highlights the responsibilities of both managers and employees, detailing the benefits of performance management for both the organization and its staff. The report also examines appraisal tools, documentation methods, and the creation of the right atmosphere for performance conversations, providing valuable insights for leaders seeking to unlock their employees' potential and drive organizational success.

Introduction
Purpose
The purpose of this report is to raise management personnel’s awareness of good people
performance management in the workplace and in all areas of life. Along with formal training
sessions, the report is intended to aid managers in communicating with and managing staff
performance. It is a tool all managers need to consider in their leadership roles.
Scope
The report was based on research and investegation of the most up to date documented
information on performance management systems. Several main areas were covered including a
definition of performance management, competencies for leaders, managing your people, analysing
and interpreting staff performance.
Methodology
Primary sources used were discussions with management performance consultants and creators of
performance management systems. Secondary sources included textbooks and web references.
Limitations There were no limitations in compiling this report.
2.
3. Lead your team
What does it mean to lead your team? What is involved in this process and how can it be
implemented. Performance management is crucial to good leadership.
What is Performance Management (PM)?
As a manager, it’s your job to design and conduct performance management as well as train your
staff to follow the process. To do this, you need a basic understanding of what exactly PM is.
Performance management focuses on the various processes and everyday actions that lead you and
your employees to the results you want.
What is PM all about?
Generally speaking PM encompasses all activities accomplished to ensure the goals of an
organisation, department, process or person are consistently met in an efficient, effective way.
How does PM work in a business sense?
The PM process involves aligning systems, resources and people with strategic objectives and
priorities.
How does PM work on a practical level?

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Quality PM means opening up day-to-day conversations between you and your employees about
your expectations of each other and checking you’re all delivering on those expectations.
Are PM and managing underperformance the same thing?
No. Managing underperformance involves formal processes which are part of PM.
A true PM system works all the time, not just when there’s a problem.
What’s a performance management system?
When designing performance management and review processes, make sure they’re consistent with
organisational objectives and policies.
A good PM system combines and controls various processes which you should be aware of, even if
you’re not directly responsible for them (Pollitt, 2018).
1. Developing an operational plan linked to strategic goals.
2. Collaborating with colleagues on initiatives and projects.
3. Allocating resources to these initiatives and projects to create departmental budgets.
4. Assessing initiatives and projects to select the best ones.
5. Putting these in a plan that everyone agrees with.
6. Tracking how these initiatives are being implemented.
7. Warning relevant people when actions aren’t finished within their timeframes or having the
expected results.
8. Proposing and agreeing to changes to get the original plan back on track.
9. Adjusting budgets, informing relevant people of the changes.
What are the benefits of PM?
Performance management is of huge strategic importance to any organisation.
Performance management systems:
 integrate clear expectations through the whole business, so they become an obvious part of
the organisational culture.
 maximise the potential of each employee, so the organisation can reach its strategic goals.
 recognise and acknowledge employees’ talents and support their improvement and
development.
 become employers of choice, which attract and retain highly qualified staff.
 create a stronger workforce that is more engaged, flexible and goal-orientated.
How does PM benefit employees?
Most people understand how performance managment benefits businesses, but what about staff?
How relevant is it to them?
For PM to work, employees must understand the process and buy into it. This requires familiarising
them with your organisation’s PM cycle, explaining what happens at each stage and making sure
they know why the whole process is important.
What are your PM responsibilities?
You may be a manager responsible for full-time and part-time employees who are permanent,
temporary or casual.
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You may also be an employee who’s managed by someone else.
Understanding your ‘dual responsibilities’ helps you:
 Train your staff in performance management processes.
 Manage your staff’s performance better.
 Enable your manager to manage your performance better.
Employee responsibilities
What’s an employee’s responsibility when it comes to performance management? Responsibility
includes the following:
 To let my manager know what I need to be the best I can be.
 To ask for clarification if I don’t understand something.
 It’s hard to do sometimes, but it’s my responsibility to give my manager feedback on how
they’re doing as a manager.
 My responsibility? Discussing my professional development with my manager and really
making a commitment to improving myself.
 To speak to my manager about the challenges of my job and how best to face them.
Manager’s responsibilities
What’s a manager’s responsibility when it comes to performance management? A manager’s
responsibility includes the following:
 To have good quality conversations with my employees about their performance.
 To let staff know what I expect in the three key areas of work: behaviour, work itself, skills
and knowledge.
 To explain how I can support team members in reaching their full potential.
What’s a performance cycle?
For performance management to be successfull, you must conduct it in accordance with your
organisation’s protocols. The forms to fill out, types of appraisals to conduct, timelines and other
specifics of performance cycles vary from business to business. However, there’s a structure
common to most workplaces.
Performance planning conversations
Most organisations schedule performance planning conversations for the beginning of the cycle.
These discussions give managers and employees the chance to talk about and understand what they
both need to achieve at work, what’s going well and how they could do better.
This conversation is not just about clarifying expectations the manager has of the employee! It’s also
about clarifying the expectations the employee has of the manager. You’ll learn more about this
soon.
Mid-cycle review conversations

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Most organisations schedule a mid-year or mid-cycle review discussion or performance appraisal to
reflect on what’s been going on, what worked and what didn’t.
These discussions give managers and employees another chance to talk about and understand what
they both need to achieve at work, what’s going well and how they could do better.
End-cycle review conversations
Most organisations schedule an end of year or end-cycle review discussion to wrap up the cycle.
This discussion is another appraisal which often leads into another performance planning
conversation: yet another chance to clarify expectations and improve.
Everyday performance conversations
These conversations can happen anytime as part of your normal day at work, either in passing or in a
more formal meeting. They can be about anything: expectations, feedback, or specific issues that
need to be addressed (Brendan Parsons).
These are a way of monitoring, evaluating and providing feedback on performance on a continuous
basis as well as giving informal coaching.
What is a review or performance appraisal?
It’s a process of observing and evaluating an employee’s performence in relation to their job
requirements over a period of time (usually six to 12 months).
It’s a formal, structured system of measuring job-related behaviours and the employee’s
contribution towards organisational goals.
The employee and their manager complete an appraisal tool or questionnaire which guides the
process and forms the basis of assessment.
 The employee evaluates their own performance.
 The manager evaluates the employee’s performance.
 HR departments organise the appraisal system and tool.
 The employee and manager complete the appraisal tool prior to the appraisal.
 The employee and manager meet to discuss and compare results. This is known as the
appraisal interview. It can last up to two hours.
All areas of the employee’s performance are discussed and generally given a rating.
The employee has the opportunity to discuss and address training needs, future goals and
aspirations within the company, suggestions for improvements and any issues they may have in their
current job.
How do you document performance?
You don’t necessarily need to keep notes on your informal, everyday performance conversations
that happen just in passing. However, if you had a meeting, you probably did so for a reason! It’s
always a good idea to record discussions like these in minutes so you can both refer to them.
You should keep records and formally document performance plans and mid- and end-cycle review
discussions in accordance with your organisation’s performance management system. Use whatever
templates or forms your business has created for this purpose.
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This quantitative and qualitative data is important to your business.
Some performance management systems gather this kind of information in a central location and
use it in many ways to identify strengths and weaknesses across the whole organisation, so they can
recognise/reward excelence and/or pinpoint areas for improvement.
This qualitative information is also important and may be used by HR to spot areas where
performance management is working well and areas which could use more assistance.
What appraisal tools can you use?
There are a wide variety of appraisal tools which have different ways of assessing competence,
recording feedback and, sometimes, reporting on how to rectify any performance issues.
The type of appraisal tool used usually depends on the size of the organisation and its HR objectives.
These are the four most common appraisal methods:
 Graphic rating scales
 Behaviourally anchored rating scales (BARS)
 Management by objectives (MBO)
 Forced distribution
A manager was told to rate his subordinates and produced the following results:
Subordinates performance rating distribution
Unsatisfactory 5.00%
Borderline 15.00%
Satisfactory 50.00%
Good 20.00%
Exceptional 5.00%

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Performance rating distribution
Source: Robbins J 2016
Get the big picture
Where do you and your employee fit into the big picture? Look over strategic, operational and other
business plans. Reread role and job descriptions.
Go over codes of conduct, performance standards, KPIs, work outputs, required skills and
knowledge, etc.
Watch the team in action
How do they communicate? What actual words and body language do they use? How do they
interact with each other? What work do they find easy? What work is hard for them? How do
they respond when someone gives them feedback? What motivates them? What demotivates
them?
How do they learn from each other? How do they learn best?
Create the right atmosphere
Get out of the office and interact more with everyone.
Prepare yourself and your staff for more formal conversations
Meet in the right place
In a busy workplace, it’s not always easy to find a place where you won’t be interrupted!
Make sure you do so. You don’t want colleagues eavesdropping in on or interrupting performance
conversations. They’re private, confidential meetings!
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5.00%
15.00%
50.00%
20.00%
5.00%
Unsatisfactory
Borderline
Satisfactory
Good
Exceptional

Meet at the right time
Choose a quiet time of day when you’re least likely to be rushed. Give yourself enough time to talk.
Prior to the meeting decide how much time to allocate to the discussion.
Know the rules of engagement
Employees should have some idea of what happens and how to behave during meetings. You’ll learn
more about good quality conversations on the next screen.
4. Performance Planning
It is necessary to open up conversations with employees and consult with them to find out how they
are and if they need anything. This is part of performance planning.
Unlock your employees’ performance potential!
Your people are all treading water. In fact, they are struggling, floundering and going nowhere.
They’re not sure what to do, so aren’t performing as you’d like them to.
To stop them swimming in circles, create a DAM.
 Discussion
 Agreement
 Mutual commitment
Discussing, agreeing and mutually committing to expectations involves the following three key
areas of work performance:
 Work executed
 Behaviour
 Skills and knowledge.
Expectations about work executed
Work executed is any work your staff do: services they deliver, products they make, projects/tasks
they undertake, outputs/deliverables they’re responsible for.
The goal-setting process determines how effective your performance management is. When people
set goals, particularly ones with rewards attached to them, they’re motivated to perform well.
Clearly define expectations in staff job/position descriptions when you recruit/hire them.
Catch up on a regular basis to chat informally about how projects are progressing.
Conduct formal performance appraisals and document your discussions.
Expectations about skills and knowledge
Skills are talents or abilities employees get through training or experience.
Knowledge is an employee’s understanding/awareness of the information, facts, and/or principles
necessary to carry out their work.

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Expectations about behaviour
Behaviour is how staff do their work and conduct themselves when interacting with others.
There are many behavioural standards and professional codes specific to certain jobs, such as ethical
codes which medical practitioners follow. Other behaviours may be more generally linked to the
values your organisation upholds.
What is performance measurement?
Performance measurement is a way of managing outcomes.
What are performance measures?
They’re numbers which tell you about your services, products and the processes that produce them.
What exactly do you measure?
You can measure results (gold medals, outputs, financial outcomes such as profitability, growth, ROI,
etc.).
You can also measure what gets you the results (increased strength, flexibility, quality, innovation,
customer satisfaction, meeting customer needs, learning, training, use of resources, etc.).
What do performance measures tell you?
Performance measures tell you how well you and your staff are doing, if you’re meeting your goals, if
your customers are satisfied, if and what you might need to improve.
Human resources and risk management
Every activity of an organisation can pose a risk. It is your job to ask yourself ‘What can go wrong?’ In
human resorces, risk management focuses on ‘people risks’, e.g., having a shortage of employees,
employees breaching EEO legislation or the company’s code of conduct (Dowtful).
In identifying risks, you need to brainstorm all the risks you can think of, then document them.
Consider both the general risks (that which may happen to any organisation) and the risks specific to
your organisation, workplace or department.
What can a risk be?
The lists can be exhaustive. If you do a thorough job of identifying risks, you may end up with a long
(and overwhelming) list. However, there are some risks that are more common than others.
Risk assessment template
Risk assessment involves identifying, analysing and evaluating risk. Templates such as these form
part of your knowledge management system.
Risk
Assessment
Date of
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assessment:
Risk
Potential harm
or
consequences
Level
of risk Risk
controls
Person
responsible for
action
Risk Assessment (top row)
Date of assessment: (second row)
Name of person completing assessment:
Department/work area/task assessed:
Risk Potential harm or consequences Level of risk Risk controls Person responsible for
action Date completed (third row)
Add 4 blank rows at the bottom for text to be entered when the form is completed.
Business risk template
List the source: Cartwright Neil 2017
5. Performance reviews
One of the biggest causes of underperformance is the seagull manager. Every now and then they fly
into the office, squawk at everyone, flap around, make noisy demands, criticise people, basically crap
all over the place and fly away again, leaving staff demoralised, demotivated and exhausted.
Don’t be a seagull manager!
 Monitor performance
 Assess performance
 Provide formal and informal feedback
 Correct underperformance
 Reward excellence
Monitor performance

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Monitoring is about comparing actual performance against planned performance and identifying
differences, so you can apply strategies to correct them.
This is the first step towards getting performance back on track and keeping it there.
What do you monitor?
What you monitor depends on your organisation and employees. Review your work processes and
procedures for points where you could monitor.
Do monitor
 Use of time
 Use of physical resources
 Application of relevant standards and procedures
 Progress towards goals and KPIs
 Changes to external environment (budget cuts, increase in phone calls, etc.)
Don’t monitor
 Anything difficult or expensive to measure
 Anything difficult to interpret or understand
 Things you and your team aren’t responsible for
 Things that won’t cause individuals or teams to act differently
 Things that don’t impact on your goals or KPIs
Assess performance
The performance cycle usually involves formally assessing an employee, usually over a twelve-month
period. Performance appraisals or mid-cycle reviews are part of this process.
Train employees in how the performance management and review process works. It’s important
that they understand the whole cycle, which provides a record of expectations, agreed goals and
feedback exchanges between managers and employees regarding achievement and areas for
improvement.
Provide formal and informal feedback
Giving (and getting) good quality feedback allows everyone to get a clear idea of how they’re going
in their jobs. All staff (even you) need to know what they’re doing well and where they could
improve.
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How do you give performance feedback?
There are many ways to provide formal and informal performance feedback. However, as a
manager, you need to pay particular attention to how you give feedback. Feedback discussions are
one of the most ‘crucial conversations’ you can have in the workplace. The stakes may be high, there
may be differences of opinion and emotions can run strong.
The costs of underperformance
The costs of underperformance are difficult to calculate. Some research indicates that a chronically
underperforming employee can cost the company as much as 80% of the employee’s annual salary
(Pulakos, Mueller-Hanson and Arad, 2019). This figure increases if a dismissal takes
place, resulting in recruitment and legal costs (in case of unfair dismissal claims).
Implement performance development
Discuss the underperformance with the employee, problem-solve together and develop an
action/improvement plan and timeframe for improvement.
How do you resolve work performance problems?
Once you’ve identified performance gaps through monitoring, how do you resolve them?
Coaching or mentoring! This is one-on-one training that helps workers gain the required skills and
knowledge necessary to do their jobs to organisational standards (Grossi and et. al., 2019).
How do you organise performance development?
If you have identified a need for further coaching, training or professional development, then
organise this according to your company’s policy.
How do you conduct formal counselling?
If all else fails, you’ll need to conduct formal counselling. This is a structured process outlined in the
company’s employee handbook or HR policy (Bauwens and et. al., 2019). Refer to these
documents prior to conducting formal counselling sessions.
Two management-level employees are usually present: the employee’s immediate supervisor and/or
manager as well as an HR representative, if applicable.
How do you deal with difficult situations in performance meetings?
When conducting performance counselling, apply assertive communication strategies and
continually work on improving your interpersonal skills. Remember to focus on the behaviour or
underperformance, and the effect of the underperformance. Don’t get personal. Encourage open
conversation and work towards acknowledgement of underperformance.
What if performance still doesn’t improve?
Despite everyone’s best intentions, you may need to terminate an employee due to ongoing poor
performance.

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Do you have to give employees notice before terminating them?
Yes. Legally, you have to give reasonable time and assistance to improve performance.
Although it’s not required by law, many companies use a three-warning system to ensure the
employee has ample opportunity to demonstrate willingness to do better.
1. Verbal warning
2. Written warning (1)
3. Written warning (2)
4. Termination
Record these warnings and keep copies in case the employee disputes their termination.
Reward excellence
To keep your top performers at the top of their game, give continuous feedback about what they’re
doing right. Recognise and reward them for their excellent performance twice as often as you
‘constructively criticise’ them. Provide some incentive to ensure they continue to excel.
Conclusion and Recommendations
It is concluded that good performance management skills are highly valuable for managers
in any organisation. Any training undertaken in this area will be very beneficial to
management and staff. It is recommended that Bendigo Broadcasting implement lengthy
and thorough training in this area to be conducted by industry consultants who specialise in
this field.
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