Performance Management System for Australian Hardware

This assignment explores the need for a robust performance management system within Australian Hardware. It delves into key performance indicators (KPIs) and proposes a new appraisal system emphasizing regular performance monitoring, talent management, and employee feedback. The proposed system includes tools like software tracking sales, customer feedback, and return rates. The central database will store this information securely, accessible only to authorized personnel. Additionally, the assignment highlights the role of store managers in monitoring performance and providing feedback.

Running head: DEVELOPING PERFORMANCE MANAGEMENT PROCESS
DEVELOPING PERFORMANCE MANAGEMENT PROCESS
Name of the Student
Name of the University
Author note:

1DEVELOPING PERFORMANCE MANAGEMENT PROCESS
EXECUTIVE SUMMARY
Performance management process is Human Resource function in which the performance of the
employees are assessed and analyzed in a systematic way. In the following essay a hypothetical
situation of planning a performance management process of a simulated business organisation
called Australian Hardware is discussed. The planning along with the implementation processes
are elaborated along with.

2DEVELOPING PERFORMANCE MANAGEMENT PROCESS
Table of Contents
INTRODUCTION...........................................................................................................................3
DISCUSSION..................................................................................................................................3
REVIEW OF THE BUSINESS INFORMATION PROVIDED.................................................3
PERFORMANCE MANAGEMENT OBJECTIVES.................................................................5
PROCESS DESIGN....................................................................................................................6
CONSULTATION WITH MANAGERS....................................................................................7
IMPLEMENTATION PROCESS...............................................................................................9
REFLECTION...............................................................................................................................12
OUTLINES OF THE MAIN FEATURES OF THE PERFORMANCE MANAGEMENT
PROCESS..................................................................................................................................12
FOCUSING ON ONE OF THE FOUR ABOVE ASPECTS....................................................13
CONCLUSION..............................................................................................................................14
REFERENCES:...........................................................................................................................15

3DEVELOPING PERFORMANCE MANAGEMENT PROCESS
INTRODUCTION
Performance management process is the method by which the permanent and the
contractual employees are monitored and their performance is evaluated and assessed (Brunnert
et al., 2014). In the process, the overall performance of the organization as a whole and its
different departments can be analyzed and assessed as well.
In the following essay, a comprehensive performance management plan would be
developed and the implementation process discussed for the simulated business “Australian
hardware”. The company in its simulated version has 138 hardware stores across Australia and
employs about 10000 staff. The company supplies high quality home furniture, hardware and
building materials.
DISCUSSION
REVIEW OF THE BUSINESS INFORMATION PROVIDED
The mission statement states that the company provides best standard hardware, garden
articles, home wares and building material in the country, and the company is committed to
provide consumers low priced quality goods and expert service. The company’s vision is to
become the largest hardware retailer in Australia. Therefore, there needs to be a comprehensive
and effective human resource process to utilize the full potential of each individual employee.
The target market of the company has been divided into home wares, do-it-yourself articles, and
trade-persons. To achieve the vision statement the strategies adopted are to increase sales and
market share, cost-cutting, maintaining and increasing quality of products and services. The
organizational chart of the company is as follows.

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Figure 1: Organizational Chart of Australian Hardware
Source: (Australian hardware, 2018)
Market researches done by the company and other sources indicated that there are huge
possibilities of growth in the Australian hardware market (Miller, 2016). The objective of the
company is not to compete on the price and capture customer base of competitors. This company
differentiates itself from the competitors by innovating its products and the products that
perfectly fit the consumers demand (Australian hardware, 2018).
Based on the present company mission and vision statements, structure, and strategy,
some important objectives in performance management can be identified.

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PERFORMANCE MANAGEMENT OBJECTIVES
Performance
management
objectives
Developing a more efficient KPI indicator
A more dedicated and accurate performance appraisal system
Increase efficiency and motivation of the employees
Training the employees to be different from employees of the competitors
Key Performance indicator (KPI) is a tool through which the performance quality of
individual employees can be tracked. There are various models of KPI (Parmenter, 2015).
Development of a better and accurate key performance indicator will automatically make the
second objective of a better appraisal system easier.
The third objective, which is set, is to increase the efficiency of the employees which
would cast a positive impact on the overall revenue of the organization. One of the main methods
of increasing motivation of the employees is by motivating them in financial and non-financial
ways. A motivated employee always works more than a de-motivated or less motivated
employee (Lazaroiu, 2015).
The second objective, which has been decided, is to train the employees in a way that
would set them apart. One of the strategies devised by the company in its business policy is to
keep the company differentiated in its market segment.
PROCESS DESIGN
Key performance indicator is very necessary to assess and evaluate the employees
accurately. The first requirement for implementing a KPI is to identifying and defining the areas

6DEVELOPING PERFORMANCE MANAGEMENT PROCESS
of business process, which needs to be assessed and improved. There may be separate sections of
KPI including financial performance, employee dedication, customer satisfaction, overall growth
of business and similar fields. In the case of Australian hardware, the primary objective is to
increase revenue through customer satisfaction. Therefore, the process can start with employee
motivation, which will make the employees more efficient in their service, this will increase the
service quality, and ultimately increase customer satisfaction (Jahanshani, 2014). Hence, the KPI
process may ideally start with motivation level of the ground level employees and their
efficiency. This may be measured through a digital system, which tracks the daily hours of work
of an employee, successful transactions made by the employee and customer review about the
employee. This part of the KPI process will cover the base of the organizational structure
comprising of sales consultants and sales assistants. The next stage of the organizational chart
consists of timber managers, plumbing and electrical managers, hardware and home products
manager, garden products managers and general managers of operation for each store. They can
be brought under the KPI system through effective monitoring of the tasks allocated to them
individually. It is visible how technical works are dedicatedly divided to each person having that
particular expertise. Key performance indicator of each of them will monitor and assess how
efficiently they can achieve their targets in their specific expertise, which will benefit the
company as a whole. The middle managers monitor the lower managers (Bandiera, 2015). The
store managers who are above the above-mentioned employees and managers can be assessed by
the performance of the store as a whole and how it is growing its revenues with time. This
performance management process mentioned above will efficiently track the performance of all
the employees at all levels and give a clear indication of the achievements, growth and
weaknesses of the company. When the above-mentioned Key Performance Indicator process is

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put to work the system of accurate employee appraisal will automatically be in place. Clear data
about the performance of each employee will make it easy for the HR managers to appraise
them. Apart from that the weaknesses and problems among the employees will also be identified
which can be solved through training and motivation.
CONSULTATION WITH MANAGERS
Consultation about the whole process with the Chief Operating Officer or COO is very
important because he is responsible for the operations of the whole business, and implementation
of the policies on ground level. There was a detailed meeting about the objectives set and
processes designed in order to maintain a balance between the human resource processes and the
operations. The chief operating officer expressed his concerns that developing the key
performance indicator may hamper the daily operations and customer service if the process is too
long. The KPI should be blended with the daily operations in a way that it does not pose a
hurdle. Increased efficiency and motivation from the employees can be achieved by setting more
achievable targets, and a friendly work environment, this was conveyed to the COO so that it is
one of the priorities of the operational managers on the ground level is to motivate the employees
regularly. In the meeting it was discussed that, to develop a more efficient performance appraisal
system there must be a close co-ordination between the operations and the human resource
department, because the feedback of the work and performance of employees will be given by
the operations to the HR. Therefore, the managers under operations department who are
supervising the employees need to provide regular feedback.
The next meeting was held with the Chief Financial Manager, or CFO, who is responsible
for the releasing of fund for new processes and mechanism. The KIP needs new software
development and ERP (Enterprise Resource Planning); it needs to be done by a professional web

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consultant and programmer. In the meeting held with the CFO it was discussed what amount of
fund is needed to be allocated for the ERP design. Apart from that, the new appraisal system
includes rewards and recognitions to employees who are successful in achieving targets. The
rewards include monetary incentives. The amount of incentives has to be as per the performance
quality of the employee. It was decided that the better customer satisfaction an employee could
achieve, the more incentives would that employee earn. Customer satisfaction is more important
than number of sales achieved by an employee, because satisfied customers are returning
customers. The last objective of training the employees needs a better training system and new
executives in the human resource department who would conduct the trainings. The financial
department granted all these expenses and the meeting turned to be very useful.

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IMPLEMENTATION PROCESS
The process design of developing performance management has been discussed above.
Now the implementation of the discussed objectives and processes has to be defined. The
following chart will elaborate the implementation of the required processes.

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Action Resources Strategy/tactics Timelines
Developing a better KPI
system
Digitised monitoring of
employee performance
through biometric records,
electronic surveillance through
CCTV, and recorded daily
performance/achievement
through ERP (Enterprise
Resource Planning)
Through the biometric
records the timeliness of
the employees and
whether they are working
at their respective places
or not can be understood.
Electronic surveillance
system like cctv or
webcams will detect the
behaviour of the
employees towards the
customers can be
comprehended. The daily
achievements of the
employees in a recorded
profile can give the
managers a clear view of
the total performance of
the employee throughout a
selected timeframe.
Biometrics and
CCTV cameras are
already in place.
Better surveillance
through CCTV will
be started in next 1
month. The ERP
has to be
programmed and
will be ready in 6
months.

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Accurate performance
appraisal system
Softwares and tools for
analysing the recorded data
from the KPI. A separate tab
for employee appraisal in the
ERP would be programmed to
perform the function.
The recorded data of
employee performance in
the KPI has to be analysed
scientifically and
categorically which will be
used systematically by the
managers to appraise the
employees.
6 months. When
the ERP is
completed.
Increased motivation of
the employees
Monitory incentives.
Emotional back up.
Rewards and recognitions.
The employees performing
well will be monetarily
incentivised. Achieving a
sell above the target will
bring in additional
incentives to the
employees. Employees
getting higher customer
reviews will get rewards
and benefits.
1 month time
frame for
implementation.
REFLECTION
As the HR manager of a large company like Australian Hardware I had to be careful that
no one among the 10000 employees are left out from the performance management system. This
organization depends on customer service, which increases customer satisfaction (Hurley, 2015),
hence the process developed by me that includes recording of efficiency of the employees and
their behavior towards the customer, is important for the growth of the employee. The
application possibilities of the planning is realistic and programming a elaborate ERP and having

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a efficacious surveillance system would suffice. All the employees would be given equal and fair
chance to grow and grievance cell would be in place to take care of any act of discrimination.
The complaints will be duly considered and solved in time. I have learnt considerably in the
process of formulating the performance management process that has cleared my vision about
HR functions.
OUTLINES OF THE MAIN FEATURES OF THE PERFORMANCE MANAGEMENT
PROCESS
Regular monitoring of performance- The store managers would be closely monitoring the
performance of the employees under him. The process adds the responsibility of monitoring in
the job role of the store managers.
Identification of performance gaps- The store managers in their monitoring would identify
performance gaps with the help of smart monitoring and software tools. Daily sales and customer
satisfaction would be entered in the software under the employee names and would be evaluated.
Providing feedback- The software would integrate system, which will enable the managers to
provide instant feedback to the HR department that would keep the proper appraisal system in
place.
Managing talent- Talent management and retention is one of the main objectives of the appraisal
system. Therefore recognizing the talented employees and keeping them satisfied and motivated
is included in the new system of performance management.
FOCUSING ON ONE OF THE FOUR ABOVE ASPECTS
Regular Monitoring of Performance- Examples of regular monitoring of employee performance

13DEVELOPING PERFORMANCE MANAGEMENT PROCESS
includes the store manager keeping a close eye on the performance of the employees posted at
the store and making sure that the customers are dealt with in a careful and attentive manner.
Tools of the performance monitoring include software that keep a record on the daily
sales achieved by an employee, number of customers who gave great feedback to that employee,
and number of satisfied customers returning fully satisfied after dealing with a employee.
The storage of the track records of the employees performance will be done completely
virtually on the central database of the company located in the main server placed in the head
office of the organization. The company storage policy states that there will be complete security
and privacy of the employee database and the feedback per employee will be categorized in the
same way. Only the HR managers and the authority who are responsible for evaluating the
performance appraisal system would be getting access to the data.
The new job role provided to the store managers will include the responsibility of
monitoring and feedback. The time needed for this will be provided by freeing them of some
clerical responsibilities like keeping attendance and managing facilities.
CONCLUSION
Australian Hardware as described in the business simulation is one of the most successful
home ware and hardware furniture company in Australia. It is very necessary for such a large-
scale company to have a proper KPI system in place and a well-defined HR process. The above
discussed performance management system will help the company to perform better.