UNIT 3 AOS 2 BUSINESS MANAGEMENT

• Performance management strategies


  Strategies to achieve both business and employee objectives, including management by objectives, appraisals, self-evaluation and employee observation
• Performance management


  A system used to improve business success through setting standards for employee achievement and measuring or evaluating employee progress towards business objectives
• Management by objectives (MBO)


  A process by which management and employees agree on a set of goals for each employee, with these goals all contributing to the objectives of the business as a whole
• Appraisals


  Any method of evaluating the performance of an employee against preset targets
• Why use performance appraisal


  • Determine promotions
  • Provide feedback to the business on its selection policies
  • Evaluate effectiveness of employee training and development systems
  • Determine further training needs
• Self-evaluation


  Refers to when an employee measures their own performance in the workplace in relation to their own goals or team-related goals
• Employee Observation


  A strategy where a variety of opinions on the performance of employees is sought with the aim of arriving at a more comprehensive picture of past and current performance
• Positives of performance management strategies

  • Both management and employees have a clearer direction on the key business objectives leading to more successful business outcomes
  • Improved communication during the goal setting, monitoring and feedback allow management and employees to build relationships leading to achievement of goals
  • Many employees benefit from honest feedback and will be more highly motivated to improve their performance when given feedback, support and encouragement to achieve business objectives
  • Self-evaluation allows the employee to control the measuring of their own performance with the employee feeling trusted instead of fearful when being assessed
  • Employee observation using 360-degree feedback avoids personal bias and gains feedback from a range of sources so a wider range of opinions are provided
• Negatives of performance management strategies

  • Not all managers have the required communication and interpersonal skills to build trust in setting goals and receiving feedback
  • Not all employees will be motivated by goals or the incentives/rewards being offered which may lead to those employees failing to perform at the required level
  • Goals may be too easy and may not improve performance
  • Many employees will fear being evaluated by a manager and may feel that their job is threatened resulting in a breakdown in manager/employee relations
  • Many employees and managers can feel that measuring employee performance increases workload and is a waste of time, taking employee focus away from the completion of core business activities
  • Self-evaluation may lead to employees focussing only on their success rather than critically and honestly evaluating themselves possibly leaving the businesses goals not being achieved
  • 360-degree feedback is costly as the surveys are usually constructed for the business by a consultant who designs questions based on business needs
  • 360-degree feedback is time consuming as workers and managers must complete detailed surveys and are not focused on their day to day work
• Appraisal


  Any method of evaluating the performance of an employee against preset targets
• Motivation strategies


  • Performance related pay
  • Career advancement
  • Investment in training
  • Support strategies
  • Sanction strategies
• Performance related pay


  A financial reward to employees whose work has reached or exceeded a set standard
• Performance related pay


  • Pay rise
  • Bonus
  • Commission
• Career advancement


  The upwards progression of an employee's job position
• How career advancement increases motivation

  • Job experience - employees are often motivated by a more challenging experience
  • Desire for increased remuneration - increases in salary/wages
  • Ambition and status - promotion can motivate employees through their sense of ambition and status
• Opportunities to develop an employee's skill base

  • Job enlargement - involves making a job bigger or more challenging by combining various operations (horizontal)
  • Job enrichment - involves expanding the job by increasing its depth of content as well as the degree of control the job holder has over their work (vertically)
  • Job rotation - where workers are moved between different jobs to increase the variety of work. This also creates a more flexible work force
• Investment in training


  The direction of finances into the teaching of skills to employees
• Types of training


  • On the job training
  • Off the job training
• Benefits of training


  • Employees gain skills and job knowledge through training and job experience
  • Employees feel that they are contributing to business outcomes
• There are certain circumstances which training will not assist in motivation – such as poor business systems, employees being placed in jobs not suitable to them, not following through with providing staff with opportunities to use new skills
• Support strategies


  The assistance or services (such as counselling and mentoring) provided by business to help employees cope with difficulties that may impede their work performance
• Examples of support strategies

  • Regularly checking on their health and wellbeing
  • Praising and encouraging good performance
  • Recognising achievements through rewards or personal recognition
  • Accommodating for an employee's out-of-work obligations
• Sanction strategies


  A form of penalty or discipline imposed on an employee for poor performance
• Examples of sanction strategies

  • Verbally warning employees
  • Providing written warnings
  • Dismissing under-performing staff
• Workplace relations


  Historically referred to as industrial relations, workplace relations is concerned with the contractual, emotional, physical and practical relationship between employer and employee
• Workplace relations


  Aims to achieve optimal working relationships between employees of a business and its management/owners
• Significant aspects of workplace relations

  • Establishment of wages
  • Settling workplace disputes (grievances)
• Workplace relations refers to the relationship and communications shared between employees (and/or their representatives) and their employers (and/or their representatives)
• Participants in workplace relations

  • Human Resource Managers
  • Unions/Trade Unions
  • Employees
  • Employer associations
  • Employers
  • Fair Work Commission
• Human Resource Managers


  The person directly responsible to represent management in relation to building positive relationships, motivating, training, establishing fair pay and conditions for employees in order to achieve business objectives
• Lawrence and Nohria's Four Drive Theory

  The four drives are: acquire, bond, comprehend (learn), and defend
• Human Resource Managers


  • Administration of wages and entitlements and queries in relation to workplace policies/procedures
  • Negotiation with employees and/or representatives (unions) regarding workplace relations issues and collective agreements
  • Represent the business in dispute resolution
• The four drives


  • Acquire: the desires to own material goods and desire for status, power and influence
  • Bond: the need to form strong relationships with other individuals and groups
  • Comprehend (learn): the desire to understand or make sense of the world around us and contribute to it
  • Defend: the desire to remove threats to our safety and security and to protect what we regard as 'ours'
• Low job satisfaction


  Likely cause of low motivation
• Unions


  An organisation formed to represent and protect the rights of workers in relation to their pay and conditions in a particular industry
• Termination management


  Includes retirement, redundancy, resignation and dismissal, entitlement and transition issues
• Unions


  • Negotiates pay and conditions during collective bargaining
  • Provides input into the development/changes to awards
  • Provides support and advice to shop stewards and employee members
  • Acts as a spokesperson to highlight issues to the public/media in relation to issues/disputes
• Employees


  Those individuals who perform the core functions/activities of the business and expect fair pay and working conditions as a reward for their efforts
• Voluntary termination


  When an employee decides to leave a business
• On-the-job training


  Training that occurs when employees learn a specific set of skills to perform particular tasks within the workplace, usually involving coaching and mentoring