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Does the Performance Management Have Effective Result on The Organization and Its Staff? (Other (Not Listed) Sample)


A liTERATURE REVIEW ON the topic: 'Does the Performance Management Have Effective Result on The Organization and Its Staff?'


Does the Performance Management Have Effective Result on The Organization and Its Staff?
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Literature Review
Tesco is one of the top corporations in Britain. Just like many other corporations, Tesco is striving to ensure it meets its competitive mandate. Its main focus is anchored on performance management and effective customer service (Direction, 2009). With its expansive framework and global presence in over 13 countries and clientele-base exceeding 250 million the company has laid out objectives and strategies (Marr, 2009). Considering these operations and magnitude of the organization, the Tesco management has been keen enough on establishing strategic performance management frameworks that have enabled it to reinvent and wholly improve continuously (Marr, 2009).
The performance management system at Tesco is founded on the steering wheel which has four parts or quadrants (Direction, 2009). The four quadrants are namely: customer-base/clientele, operations, personnel, and finance. Each of these quadrants has its specified performance determinants (Direction, 2009). Each quadrant is evaluated against these determinants. The Tesco employees as the area of key focus are reviewed on a quarterly basis. The reviews are usually sent to the top management and communicated back to the employees (Direction, 2009). The salaries of the management are established through evaluation of key performance signals set by Tesco (Direction, 2009). This is part of the performance management strategies set by Tesco to ensure all parties within it focus or are driven towards business objectives.
To this end, the company continues to incorporate strategic performance management in a set of procedures and processes focussed on achieving the set organizational goals. The attainment of the goals is established through enhancement of team and individual performance within Tesco. The company has also endeavoured on creating an organizational strategy that is aligned with individual goals held by all key Tesco stakeholders. The strategy further focuses on establishing the company’s strengths and improving upon the areas that the company is seemingly poor in (Marr, 2009). The strategic performance management within the company is specified in a number of phases. The phases are namely: planning, execution, measurement and improvement. Each of these phases succeeds the other in a cyclic manner. The performance management is highly inclined towards the employees. The strategy is particularly focused on the employees and how best they complement the organizational goals.
Tesco, as an organization, understands the role and the impact of the employees in the overall organizational performance. The Human Resource offices in all global franchises and branches have clearly laid out strategies that ensure that performance is enhanced by the Tesco personnel (Marr, 2009). The performance management system in place to aid in Tesco employee management has three phases; planning monitoring and evaluation. In the planning phase, the company provides the employees specific job descriptions. Each employee at Tesco has clearly laid out duties and role (Marr, 2009). The roles played by all employees are structured to ensure that they complement the organization’s strategic culture and direction (Marr, 2009). Under this phase, the employees are further given insight on how the company will measure their performance as well as how the management will execute the monitoring process. The employee management system is easy and practical making it applicable to employees at all levels (Matzler et al.,2004). There is also an eased top down communication structure linking the management and the employees. The clear communication enables the management to communicate the expected tasks to be accomplished. Effective communication is also essential in ensuring that employees voice their concerns on various operational concerns that they deem may divert the organization from meeting its end goals. The communication further enables the organization to pinpoint the weak links within the organizational structure at Tesco (Matzler et al.,2004).
In the second phase, Tesco employees are monitored on a regular basis but in a non-micromanaging way. The employees and departmental heads regularly meet to assess progress towards achieving the set performance objectives. According to Matzler et al., (2004) barriers are also assessed by the two parties to ensure that the work environment is enabling enough for the employees to meet their performance objective (Matzler et al.,2004). At this level, the Tesco management also establishes if any changes can be factored in the employee work plan. The employee performance management at Tesco is also fostered by constant monitoring and measurement of results and conduct (Matzler et al., 2004). The company further has collaborative processes that enable it to set and review employee performance through constant review of performance based on a two-way communication between managers and employees (Koys, 2009). With these activities synonymous with the third phase, the employees under the auspices of the managers summarize the work done capturing key accomplishments, results, and challenges.
Through identification of the key weaknesses the management effectively proposes ways to counter the weaknesses and improving performance (Cronin, Brady, & Hult, 2000). The two parties also discuss and identify areas for development or training. They further establish unforeseen barriers to aid in the objectives achievement (Koys, 2009). There are also elaborate appraisal systems that seek to promote and reward performing employees. The appraisal further includes the company’s constant development and training opportunities anchored on improving overall performance of the employees and ultimately of Tesco (Koys, 2009).
Customers are an integral facet in any organization’s performance management strategy. Their retention, feedback, and satisfaction are pivotal in the overall organizational performance. According to Carson Research (2010),” customer satisfaction is the positive emotional state reached by a customer after purchasing a product or service.” The literature further notes customer satisfaction is greatly derived from employee relationship and interaction at an organization (Cronin, Brady, & Hult, 2000). Tesco understands and has thus established effective interactive customer platforms that ensure that customers experience satisfaction as they visit any of the Tesco outlets globally (Carson research, 2010). As an organization, Tesco understands that it costs twenty times as much to bring in new customers as it costs to retain the older ones. It is through this understanding that the company strives to enhance customer loyalty by providing them with a goo Tesco experience (Carson research, 2010).
Customer feedback is further posited to be critical in the company’s performance management. The customer feedback allows the company to comprehend its SWOT (Strengths, Weaknesses, Opportunities and Threats) (Cronin, Brady, & Hult, 2000). A customer may highlight valid concerns regarding service delivery which may, in turn, be reviewed by the concerned departments (Cronin, Brady, & Hult, 2000). It is such reactions that enable an organization to structure their service with the aim of satisfying the customer while at the same time mitigating the risk of bad reviews and poor client management (Kumar, Batista & Maull, 2011).
Cronin, Brady, and Hult (2000) acknowledge that customer feedback is essential in enhancing the company’s performance management. The authors further note a company’s performance is anchored on customer success and loyalty which can only be maintained through proper appreciation of customer feedback (Cronin, Brady, & Hult, 2000). The relationship between the customer success and loyalty is complicated and thus, a company such as Tesco ought to strike the balance in its pursuit to acquire new customers as well as retain old ones (Cronin, Brady, & Hult, 2000). The two factors do not thrive on their own but are also anchored on customer satisfaction which can only be availed through proper employee- customer interaction. By forging such a fruitful interaction, a company is able to meet its growth mandate but also performance in various organizational spheres (Cronin, Brady, & Hult, 2000).
Kumar, Batista and Maull (2011) in their article The Impact of Operations Performance on Customer Loyalty establish the relation between performance and customer loyalty. The article appreciates that operational performance as directly related to customer loyalty. It is thus imperative for organizations such as Tesco to establish systems that enhance operational performance (Kumar, Batista & Maull, 2011). Through elaborate performance management structures, operational performance can be attained which in turn impacts the customer loyalty levels positively. Some of the main drivers of customer loyalty are embedded within a company’s performance mandate (Kumar, Batista & Maull, 2011).
Dependability, quality, waiting time, customer relationship and trust are elements that can easily be linked to the organization’s key players: employees and the management. The employees greatly influence customer loyalty given that all these drivers are highly impacted on by employees (Kumar, Batista & Maull, 2011). All these drivers affect the affective and cognitive aspects held by the customers towards a company’s product and service delivery. Barroso et al. (2004) note employee conduct towards customers can highly influence and shape customer perceptions. The customer perceptions, in this case, determine whether at the end of the day satisfaction can be att...
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