Case Study: Freeport-McMoRan's Performance Management Strategies

This assignment analyzes the performance management system implemented by Freeport-McMoRan, a major copper mining company, to adapt to changing market conditions. The case study explores the necessity of a robust performance management system for enhancing employee skills and streamlining resource utilization. It examines how the company's web-based system improved efficiency and aligned goals with strategic objectives, leading to increased shareholder returns. The analysis compares the effectiveness of web-based versus pen-and-paper systems, highlighting the benefits of automation, data storage, and employee engagement facilitated by the former. The student also discusses the use of balanced scorecards and online feedback mechanisms to enhance brand image and customer relations, along with the importance of training and post-training assessments. The assignment references relevant theories and models, such as the scientific management theory and Lewis's change management model, to contextualize the company's strategic shifts and the impact of its performance management practices.

Running head: HUMAN RESOURCE MANAGEMENT
Human resource strategies
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1. Why did Freeport-McMoRan need a performance management system? How
might it have helped the company adjust its strategy?
Performance management systems are crucial for the businesses to maintain the
market position in the competitive ambience. In the workplace of Freeport McMoRan,
performance management systems was a necessity for enhancing the virtual learning skills of
the employees. Convenience was increased for the employees regarding efficient and
judicious use of the resources (Noe et al., 2017). As a matter of specification, performance
management system enhanced the working experience of the employees. This is because they
were at ease while using the systems. Pilot programming seemed to be effective for
enhancing the convenience and ease of the employees towards the use of the resources.
Use of the software is a productive option for the company in terms of improvising on
the performance of the firm. The functionality of the system lied in measuring the
contribution of the employees in accomplishing the identified goals and objectives. In case of
Freeport McMoRan, strategic move resulted in increased shareholder return by 19%, in spite
of the declining copper prices. The major drive behind this was effective use of the
performance management systems by the personnel. Adler, (2018) is of the view that
proactive approach from the personnel helped in aligning the goals with the values and
initiatives. This alignment can be correlated with the scientific management theory, where
labour productivity is the main essence.
Integrated strategies relates to the conglomeration of five continents through the
means of effective supply chain network. This connection was supported by outsourcing of
the requirements and follow ups with the performance management systems. Upsurge in the
copper prices was the turning point when the strategies needed to be altered. With this aspect,
Lewis’ change management model can be correlated. Mapping the condition with low prices

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was the unfreezing stage, which was to be freezed by the acquisition of the performance
management systems (Bititci, Cocca & Ates, 2016). One of the striking features was the lack
of knowledge regarding implementation of the change. The situation was tactfully handled by
the staffs through the compounding for the operations in the separate mines. Communication
gaps contradicts the integration of the processes through the performance management
systems. Unfamiliarity with the metrics also adds an interrogative parameter to the efforts
behind increase in the shareholder returns.
Acquiring the rival company can be considered to be an initiative towards exposing
tactful approach towards expanding the market share. Placing the focus on separate product
line, that is, oil and gas, aggravated the complexities in coordination. As a matter of
specification, the need of performance management systems was generating inclusive
practices. However, Cosenz and Noto, (2016) is of the view that acquiring a rival company of
twice size can be difficult in terms of influencing the purchasing decision and power of the
clients and customers. However, the plans for implementing the performance management
systems well in time resulted in generation of hope towards monitoring and tracking the
performance.
2. Do you think a pen-and-paper performance management system could have
been as effective as the web-based system Freeport-McMoRan adopted? Why or
why not?
According to me, web based system is more efficient in terms of monitoring the
performance. This is because of the automation and digitalisation, which Freeport McMoRan
would encounter towards enhancing the standards and quality of the operations.
Consideration of the devices like cloud computing and Big Data analytics would be effective
for practising bulk data (Steiss, 2019). This storage would save the company from data thefts

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and loss of confidential data. Therefore, experts need to be hired for inspecting the systems
and devices to avert the instances of cybercrime. On the other hand, pen and paper
performance management system would increase the manual labour, compelling the staffs to
encounter stress.
Web based performance management systems would enhance the virtual decision
making skills of the employees. Involving the employees in the online group discussions
would save the cost of organizing training, seminars and discussions. This approach would be
effective for maintaining the financial flexibility. In the web based management systems, the
balanced scorecards, if produced online would act assistance for Freeport McMoRan to
increase the trafficking of the audience towards the brand image (Vij & Bedi, 2016). The
results can be circulated among the employees in the emails. I think that this approach would
increase the stability in the relationship with the clients and the customers.
I have also gained an insight into the fact that off the shelve management solutions are
effective for Freeport McMoRan in terms of catering to the specific areas of operations like
revenue, market share and others. Performance management software could have been
adopted in terms of aligning the operations with the balanced scorecard principles. Extensive
web and Windows would have been effective for conducting the operations with the help of
latest technological features (Cosenz & Noto, 2016). The HR managers could have been
provided with Login ID and password, which could have enhanced the security and privacy
of the confidential codes and statements related to the share prices and shareholder returns.
Rating the performance of the team members on the excel sheets and circulating them
on emails would have been a productive option for digitalizing the operations. Along with
this, I also feel that sharing the feedback forms online would have been effective for reaching
out to large number of audiences. Taking assistance of the personality and behavioural tests,

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the results of which could have been stored in the excel sheets. Graphs could have been
prepared on this data, which would have helped in conducting journey mapping for the
currently altered strategies for increasing the shareholder returns. As per the assumptions of
Adler, (2018), online performance management systems would reduce the burden of the
managers, enabling them to devote much time to the other activities.
Most importantly, trainings could have been planned for enhancing the awareness of
the employees towards effective use of the web based performance management systems.
Post training tests would have been effective in terms of ensuring whether the employees are
capable of making practical application of the learnt skills in executing the allocated duties
and responsibilities (Noe et al., 2017).

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References
Adler, R. W. (2018). Strategic performance management: Accounting for organizational
control. Routledge.
Bititci, U., Cocca, P., & Ates, A. (2016). Impact of visual performance management systems
on the performance management practices of organisations. International Journal of
Production Research, 54(6), 1571-1593.
Cosenz, F., & Noto, G. (2016). Applying system dynamics modelling to strategic
management: a literature review. Systems Research and Behavioral Science, 33(6),
703-741.
Noe, R. A., Hollenbeck, J. R., Gerhart, B., & Wright, P. M. (2017). Human resource
management: Gaining a competitive advantage. New York, NY: McGraw-Hill
Education.
Steiss, A. W. (2019). Strategic management for public and nonprofit organizations.
Routledge.
Vij, S., & Bedi, H. S. (2016). Are subjective business performance measures justified?.
International Journal of Productivity and Performance Management, 65(5), 603-621.