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Executive Human Resource Program
The Promise of Performance Management
Hay Group
Boston
1
0109-9271-HAYG Lemaire
The Current Challenge of Performance Management
The HR process—
Is completely unrelated to other key business processes
Is dreaded by managers and employees alike
Does not result in any meaningful feedback
Does not differentiate performance or pay
Is a focus for only one or two days—or hours—per year
2
0109-9271-HAYG Lemaire
The Promise of Performance Management
Imagine a system that could—
Increase the likelihood that your strategy is effectively executed
Harness and direct the 10–60 minutes a day of discretionary effort that every one of your employees has
Rationalize and focus the number of goals that anyone in your organization has
Improve the decisive dialogue that occurs in your organization
Reward performance in a way that it is motivating and engages people
Differentiate performance in ways that make line managers feel good about their decisions
3
0109-9271-HAYG Lemaire
Performance
Number of Employees
Source: Hay/McBer
Optimizing the performance of your people will have a positive impact on business performance
Improving Performance Management Improves Business Results
4
0109-9271-HAYG Lemaire
Percentage of variation in change in company performance accounted for by managerial practices
Source: Sheffield Effectiveness Programme
Human Resource Management Practices Drive Profitability and Productivity
5
0109-9271-HAYG Lemaire
Highly Successful Companies are defined as having—
5-year sales growth = 17.5% per year
5-year profit growth = 10.8% per year
Annual equity growth = 16.7% per year
5-year dividend growth = 13.4% per year
Source: D. Karvetz, The Human Resources Revolution
Clear Employee Goals
Participative Style
Attention to Development
Encourage Creativity
Performance-Based Rewards
Highly SuccessfulCompanies
Less SuccessfulCompanies
80%
70%
67%
62%
86%
26%
4%
27%
10%
30%
High-performing companies are better at managing, motivating, and rewar
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