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Executive Human Resource ProgramThe Promise of Performance ManagementHay GroupBoston The Current Challenge of Performance ManagementThe HR process—Is completely unrelated to other key business processesIs dreaded by managers and employees alikeDoes not result in any meaningful feedbackDoes not differentiate performance or payIs a focus for only one or two days—or hours—per yearThe Promise of Performance ManagementImagine a system that could—Increase the likelihood that your strategy is effectively executedHarness and direct the 10–60 minutes a day of discretionary effort that every one of your employees hasRationalize and focus the number of goals that anyone in your organization hasImprove the decisive dialogue that occurs in your organizationReward performance in a way that it is motivating and engages peopleDifferentiate performance in ways that make line managers feel good about their decisionsImproving Performance Management Improves Business ResultsNumber of EmployeesSource: Hay/McBerPerformanceOptimizing the performance of your people will have a positive impact on business performanceHuman Resource Management Practices Drive Profitability and ProductivitySource: Sheffield Effectiveness ProgrammePercentage of variation in change in company performance accounted for by managerial practicesImproving Performance Management Improves Business ResultsHighly SuccessfulCompaniesLess SuccessfulCompaniesPerformance-Based Rewards86%30%Clear Employee Goals80%26%Participative Style70%4%Attention to Development67%27%Encourage Creativity62%10%Source: D. Karvetz, The Human Resources RevolutionHighly Successful Companies are defined as having—5-year sales growth = 17.5% per year5-year profit growth = 10.8% per yearAnnual equity growth = 16.7% per year5-year dividend growth = 13.4% per yearHigh-performing companies are better at managing, motivating, and rewarding employeesStrategy Execution Matters to ShareholdersThirty-five percent of an institutional investor’s valuation of
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