Read the article below and answer the questions that follow: Performance Appraisal at Pepsi-Cola International Pepsi-Cola International
Question:
Read the article below and answer the questions that follow:
Performance Appraisal at Pepsi-Cola International
Pepsi-Cola International (PCI), with operations in over 150 countries, has devised a
common performance appraisal system that focuses on motivating managers to achieve
and maintain high standards of performance. Administrative consistency is achieved
through the use of a performance appraisal system of five feedback mechanisms -
instant feedback, coaching, accountability-based performance appraisals, development
feedback, and a human resource plan. The common system provides guidelines for
performance appraisal yet allows for modification to suit cultural differences. For
example, the first step of instant feedback is based on the principle that any idea about
any aspect of the business or about an individual’s performance is raised appropriately
and discussed in a sensitive manner. The instant feedback message can be delivered in
any culture; the important thing is not how it is done but that it is done. The purpose of
instant feedback isalways to improve business performance, not to criticise cultural
styles. Using this system, PCI tries to balance the cultural and administrative
imperatives of successful managing the performance of a diverse workforce.
objectives Performance appraisal:
• To review the performance of the employees over a given period of time
• To judge the gap between the actual and the desired performance.
• To help the management in exercising organizational control.
• Helps to strengthen the relationship and communication between superior –
subordinates and management – employees.
• To diagnose the strengths and weaknesses of the individuals so as to identify the
training and development needs of the future.
• To provide feedback to the employees regarding their past performance.
• Provide information to assist in the other personal decisions in the organization.
• Provide clarity of the expectations and responsibilities of the functions to be
performed by the employees.
• To judge the effectiveness of the other human resource functions of the
organization such as recruitment, selection, training and development.
• To reduce the grievances of the employees.
Practices of Performance Management
Providing Feedback. Providing feedback is the most common justification for an
organization to have a performance appraisal system. Through its performance
appraisal process the individual learns exactly how well he/she did during the previous
twelve months and can then use that information to improve his/her performance in the
future. Encouraging Performance Improvement. How can anyone improve if he doesn’t
know how he’s doing right now? A good performance appraisal points out areas where
individuals need to improve their performance.
Motivating Superior Performance. This is another classic reason for having a
performance appraisal system. Performance appraisal helps motivate people to deliver
superior performance in several ways. First, the appraisal process helps them learn just
what it is that the organization considers to be ‘‘superior.’’ Second, since most people
want to be seen as superior performers, a performance appraisal process provides
them with a means to demonstrate that they actually are.
Counseling Poor Performers. Not everyone meets the organization’s standards.
Performance appraisal forces managers to confront those whose performance is not
meeting the company’s expectations.
Determining Compensation Changes. This is another classic use of performance
appraisal. Almost every organization believes in pay for performance. But how can pay
decisions be made if there is no measure of performance? Performance appraisal
provides the mechanism to make sure that those who do better work receive more pay.
Encouraging Coaching and Mentoring. Managers are expected to be good coaches to
their team members and mentors to their proteges. Performance appraisal identifies the
areas where coaching is necessary and encourages managers to take an active
coaching role.
Supporting Manpower Planning. Well-managed organizations regularly assess their
bench strength to make sure that they have the talent in their ranks that they will need
for the future. Companies need to determine who and where their most talented
members are. They need to identify the departments that are rich with talent and the
ones that are suffering a talent drought.
What about relationships between employees and the company?
So Pepsico is managing to do “the old way” what many organizations try to do with lots
of technology and ambitious programs. “Yes, it works without tools provided the
manager/employee relationship is good“. That’s why Pepsico is investing that much on
the quality of human relationships and management quality.
At Pepsico, individual objectives are 50% business related, 50% personal. So delivery
and behavioral skills are equally valuated. Each employee can define with his manager
a personal objective which, if met, would make the coming year a sucessful year for
him. It could be “starting playing tennis again”, “pick up my kids at school on Thursday”.
It helps manager to understand employee’s expectations and priorities, what makes
sense, and play an active part in helping the employee to reach the objective. For
example by not scheduling any meeting on Thursdays after 4.00 pm for the one who
wants to pick-up his kids... “All these things contribute to bring trust and well-being into
relationship
QUESTION BELOW
1.2. Evaluate the type of Practices of Performance Management in relation to
Pepsico more specifically to coaching and mentoring. (10 Marks)