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(typed) Lucianne Powell
1. Explain at least 2 purposes of performance management and its relationship to business objectives One purpose of performance management is to enhance and maintain a high level of individual and employee performance so an organisation can perform at its best. It is essential that employees are appropriately managed so they can work to their full potential and understand what is expected of them. Another purpose of performance management is to motivate and engage employees. Employees’ should feel involved with this process by contributing to the organisations future direction and path.
The more involved employees are means the more motivated employees will be to want to develop themselves within their roles. The benefit of motivating and engaging staff is that this will increase commitment to the organisation and decrease retention. In conclusion to these two purposes, if all employees are kept motivated and encouraged to work to their best abilities, it will result in individuals meeting their targets and sharing aims that are aligned to the overall business objectives. 2. Identify three components of performance management systems 1) Performance appraisal – The purpose of the appraisal is to review performance over a fixed period of time and discuss future development.
This should be a two way discussion and should not involve any surprises to the employee. 2) Delivering feedback – Feedback is a vital part of a performance management system. It is important that an employee is given appropriate feedback that is open and transparent as this will identify part of the employees’ future development and training needs. Positive feedback should also be told to the employee as a way of recognising their good performance and keeping the employee motivated. 3) Managing under performance – Employees that are under performing need to be managed in an effective way so they can clearly understand what they need to improve on in a certain period of time. This can be done by setting clear objectives and communicating a deadline that the objectives need to be met at. These objectives should both be mutually agreed by both parties.
3. Explain the relationship between motivation and performance management, referring to at least two motivational theories. Motivation and performance management are very closely linked within an organisation. Motivation is established by the setting of incentives. We are all motivated from believing that if we take on certain behaviours, a reward will follow after. The more motivated and incentivised an individual is, the more likely they are to take a discretionary effect in their work by going above and beyond what is already expected of them. These extra efforts would certainly have a positive impact on the revenue, retention and status of an organisation. One theorist that supports this belief is Vroom. Vroom’s expectancy theory assumes that an individual will decide to behave or act in a certain way as it will lead them to a desired outcome of what they are wanting.
According to Vroom, an individual’s level of motivation depends on the three following beliefs: Expectancy is the perception on if we put more of an effort in our work; it will lead to increased performance. An employee must be confident that their efforts will result in better productivity and they have the ability to perform their work tasks well. Instrumentality is the belief that our actions will lead to a desired outcome. An employee must be confident that such increased performance with result in them achieving the desired reward or outcome. Valence is how much the individual values the expected outcome. For example, if someone is mainly motivated by money, they may not value the benefits of additional time off. Each individual will have different motivations at different points in time. A successful organisation needs to take into consideration the different motivational factors for each of its employees so that they can develop, increase and maintain motivation.
Whilst remuneration and promotion are very obvious motivations, we also know that employees are motivated by other intangible factors such as having a feeling of belonging and personal growth. Abraham Maslow discovered a great way of structuring the motivation at different points in time. Maslow believed that individuals are motivated by their needs and when one need is fulfilled, an individual will strive to fulfil the next one. Maslow created a ‘hierarchy of needs’ pyramid. Maslow believed that if the deficiency needs aren’t fulfilled, individuals will not be able to move up to the more complex growth needs and therefore this will have an effect on their development. Maslow’s theory can be applied in the workplace but it is the manager’s responsibility to effectively identify each of its employees needs and know when they have fulfilled each one. For example, safety needs could mean a safe working condition to reduce stress and anxiety for an employee.
4. Identify two purposes of reward within a performance management system. One purpose of reward within a performance management system is to attract and retain good employers. Low turnover and employee retention bring benefits to an employer as it spends less time hiring and training new workers. Competiveness between organisations in the job market is always increasing so any organisation that develops a reputation as ‘cheap’ is unlikely to be desirable as potential employees will assume it does not reward effort fairly. Another purpose of reward within a performance management system is to motivate employees to be flexible and perform to the fullest extent of their capabilities. Although motivation has to come from within, reward can be used to encourage employees to go above and beyond in their roles. Reward can only motivate employees if the reward is attractive to the employee and the employee knows that the level of performance is achievable to them.
5. Describe at least 3 components of a reward system, 1 of which should be non-financial. A reward system is built up of the financial and non-financial components that are provided to employees in exchange for their time, talents, and efforts. Financial rewards are all rewards that have a monetary value and will add up to the total remuneration of an employee. Non-financial rewards are those which focus on the physiological needs employees have such as appreciation, influence and personal growth. Three key components of a reward system are;
Recognition is awarding the employees who go above and beyond in their roles and behave in a way that is in line with the organisations business strategy. This will increase employee satisfaction by making employees feel more appreciated and invested in. Some examples of these rewards in the workplace are employee of the year awards, appreciation luncheons, long service awards and recognition programmes. Benefits – A benefits package is provided in addition to an employee’s total remuneration and form part of the total rewards package. These additional elements can include a pension, sick pay, private healthcare, life assurance, childcare vouchers and annual leave. An organisation should carefully consider and maintain what benefits it is going to have as each employee will have difference needs and circumstances. Developmental opportunities – A manager should acknowledge its employees’ developmental areas and should therefore offer the employee ways of mastering that area. Some examples of learning opportunities within workplaces are coaching, mentoring, on the job training and attending courses or seminars.
6. Explain the factors that should be considered with managing good and poor performance. Managing performance should be a continuous process that aims to improve an individual/organisational performance. It is a way of measuring what an employee contributes to the goals of their teams and the business as a whole. When managing performance we must consider the following factors; Employees must be able to understand their objectives and know what they need to do in order to meet them. Objectives are usually agreed at the start of a year so the individual can start the year knowing what they need to achieve and can then be reviewed at the end of the year. Agreeing the objectives should be a two way discussion between the line manager and employee. An effective objective should be achievable but challenging, it should be relevant to the department and business, should be easily measurable and it should have a timeframe of when it needs to be achieved. It is important that an employee receives regular feedback when it comes to managing performance.
Feedback needs to be given to employees so they can understand how they are progressing and what they need to improve on. Feedback shouldn’t have any mix messages. If improvements need to be made to an employees’ performance, the constructive feedback should be given in a timely and effective manner so the employee can soon think of solutions. It is important to focus on the resources that the employee uses within their role as this could be having an effect on their performance. A manager should listen and address any issues that an employee may have but the manager needs to be sure that these issues are genuine as employees’ can often blame external sources before admitting their own fault. When managing poor performance, a manager should identify what is causing the employee to underperform; they should do this by addressing the underperformance with the employee in one to one meetings.
Managers need to be trained in handling difficult conversations and need to feel confident in handling any sensitive conversations. It is important that a manager provides the relevant support as it will help the underperforming employee understand the opportunities for improving their performance and taking the necessary action. Organisations often manage poor performance formally through a
performance improvement plan (PIP). The PIP should be closely monitored and should set out the following; The performance problem
The timescale for achieving this improvement
A review date
Specify possible consequences if performance standards are not met Any training that the employer will provide to assist the employee.
7. Describe at least 2 items of data, including 1 external to the organisation. There are many integral documents to a performance review. Documentation helps to structure a performance review and give clear guidelines of what needs to be covered during the meeting. An item of data that can be used internally is a self-appraisal. A self-appraisal forms part of an employees’ performance review. The self-appraisal influences an individual to reflect on their performance and as a result they are more aware of their behaviour and actions which have had a consequence on their performance. The self-appraisal should give examples of what the employee believe they have done well in the past year and what they think they can improve on in the future. A manager and employee will use the self-appraisal to form the basis of discussion during the meeting.
A job description can be used as a way of measuring performance as the description provides a useful guide as to what is expected of an employee. The job description can cover the core competencies that the employee is required to be fulfilling. Visualising these competencies will help a line manager to determine how an employee is performing and what their developmental needs are. An external form of data that can be used is gathering external feedback. This is a process when an employee will ask its customers for feedback usually through use of a questionnaire. This can help determine whether an employee is meeting their objectives. The benefit of gathering external feedback is that it takes into consideration other people’s views and therefore is viewed to be more objective and valid. The disadvantage of external feedback is it can be very costly and has over-reliance on technology. 8. Explain the frequency, purpose and process of performance review. Performance reviews usually take place twice a year in the form of a mid-year review and then an annual review which would take place at the end of a financial year.
The purpose of a performance review is to provide employees’ with feedback on their performance The review should take place in a private and comfortable room away from any disruptions. The line manager should start the meeting off by explaining its purpose and what they will be discussing. The line manager would usually open up discussion by asking how the employee has felt the past 6 months or year has gone for them and discuss if the employee has effectively met their objectives. If an employee has completed a self-appraisal before the meeting, this can also form the basis for a discussion. It’s important to talk about any developmental areas for the employee and suggest ways on how this could be tackled.
Managers should discuss any feedback that had been gathered on the employee and it’s important to discuss any developmental areas for the employee with suggestive ways on how this can be tackled. If there had been regular catch ups, the employee should have an idea of how the year has gone and therefore, nothing should come as a big surprise. Managers should encourage employees’ to suggest their own objectives for the coming year and any plans that are agreed should be noted on the appraisal form. An organisation with performance related pay would have a rating scale which shows the level of performance an employee has reached. The employee should be told of their decided rating in their review with what their salary increase and bonus payment will be.
Supporting Good Practice in Performance and Reward Management (3PRM) Ref No F306A – Version 2 June 2012
MET/ NOT YET MET
LO1: Be able to explain the link between organisational success, performance management and motivation (Activity 1) 1 Describe the purpose of performance management and its relationship to business objectives.
2 Explain the components of performance management systems
3 Explain the relationship between motivation and performance management
LO2: Be able to explain the relationship between performance management and reward (Activity 1) 1 Explain the purpose of reward within a performance management system
2.2 Identify and explain the components of an effective total reward system
LO3: Be able to contribute to effective performance and reward management in the workplace (Activity 1) 3.1 Identify and explain the factors that need to be considered when managing performance.
3.2 Describe the data required by individuals involved in performance and reward management processes.
LO4: Be able to conduct and reflect upon a performance review (Activities 1 & 2) 4.1 Explain the frequency, purpose and process of performance review.
4.2 Conduct a performance review meeting.
4.3 Reflect on the outcomes of the performance review
Students should please note that the above Assessment Outcome for this Unit is provisional and is subject to Internal Acacia Learning verification (IV) and external CIPD Verification (EV).
Tutor’s signature Date
BOTOX UK LTD
PERFORMANCE REVIEW FORM
Date of Review: 11 November 2014 Period Covered: 1 May 2014 – 1 November 2014 Name of Manager: Lucianne Powell Name of employee: Becki Thomas Job Role of Employee: Sales Consultant
1. Summary of discussion on performance over the last six months Becki and I discussed the areas of her job that she has performed well in the last 6 months and the areas of her job that she would like to develop and improve on. Becki has mainly felt that the last 6 months could have been better for her in regards to her sales targets but we have discussed the ways in which this can be overcome and Becki is very motivated in doing anything she can to increase her sales so I have every faith in her that she will.
2. The quality of the work provided, recording areas that have gone well and those where improvement is required Becki has shown herself to be a great team player which is one of the main attributes to becoming successful here at Botox. Becki always actively contributes to and supports her team and the team find Becki great to work with. Customers have given very positive feedback on Becki to say that they have all found her very pleasant on the phone and can fully trust that she will complete a task that she is given which is brilliant. Becki’s sales targets have dipped in the last 6 months and this has been very concerning for the Management team. As time goes on, Becki will need to continue to build up relationships with different clients and this will increase her sales.
3. Record performance against targets set and in those cases where they have not been met, record the reasons given and your views on these Objective 1) Increase number of sales by 50% over the next 6 months. Becki has not met this objective but we have discussed the reasons why she has not met this. Becki has been going through a difficult time at home the last few months and this has been affecting her work. I have agreed that this can be an on-going objective for Becki and we will have regular catch ups to discuss if Becki’s sales targets are
increasing. Objective 2) Build up client relationships by attending more networking opportunities. Becki has met this objective by successfully attending the networking events and I have witnessed her actively socialising to potential clients. This is an excellent opportunity for Becki to gain more sales in the coming future.
4. Outline agreed actions to overcome any shortfall against targets including such factors as training and development needs, equipment needs or medical support
Actions by line manager:
Actions by employee:
To arrange a temporary change to Becki’s hours of work and regularly meet with Becki to discuss if the working arrangement is working and agree on a date for the Becki to go back to her full time hours. Once Becki’s hours are temporarily changed, she will need to make it to work on time every day and start to increase her sales. To arrange for Becki to go on a sales course and request her feedback on the course. To attend the sales course. This should hopefully get Becki back into the swing of selling.
5. Indicate whether a performance related bonus should be made at current rates. (In circumstances where the full target has not been met a case must be made before any partial bonus payment can be paid, with reasons provided for that recommendation) I have taken into consideration that Becki has been through a difficult time recently at home and I know that when focussed Becki is fully capable of reaching the desired sales targets so I have agreed to award Becki with a bonus of £500. I hope that once her childcare is in place, she can then become more focussed on increasing her sales.
Employee: Becki Thomas Date: 11 November 2014 Line Manager: Lucianne Powell Date: 11 November 2014
OBSERVATION RECORD – 3PRM
Candidate’s name: Lucianne Powell Observation Assessment: PASS
Unit 3PRM – Learning Outcome No 4:
Be able to conduct and reflect upon a performance review.
Assessor feedback – to be completed by the assessor with notes to support the decision
Informative account given to Becki at the start of the meeting re its purpose and what you planned to cover during the course of the discussion
6. aims and objectives
Your supporting notes demonstrated that you had spent some time preparing for the meeting and it followed a logical path. Key elements of a review meeting were addressed e.g. reviewing performance, setting objectives and bonus payment considerations,
Prepare suitable environment.
Used the table and sat side by side to each other/the table. Both parties appeared comfortable with this arrangement
Open meeting appropriately:
aims and objectives.
A little bit ‘programmed /scripted’ at first with an over-reliance on your notes, but once you settled into the role and nerves were dispelled your discussion became much more natural. You let Becki know the format of the meeting and that notes would be taken and that she would be able to see them – good.
Establish rapport and put candidate at ease.
Your personable style and empathetic manner helped to establish a rapport and relax the interviewee. Plenty of ‘positive strokes’ telling her how much she was valued as an employee and giving her the positive feedback received from her colleagues /customers all helped to make for congenial discussion and for her to feel supported – good
Use appropriate questioning techniques:
Open questions were used to encourage Becki to talk and reflect – I particularly liked your question asking for her thoughts on where she had performed well – this helped to ensure the discussion did not just focus on her immediate personal problems – well done!
Control meeting without dominating.
You adopted the ‘manager’ role by setting the scene, keeping the meeting focused and controlling its structure but this was all done in a collaborative and non-threatening manner.
Communicate (listening and speaking) effectively with candidate, using appropriate body language. Good listening skills evidenced, lots of head nodding, eye contact made to encourage Becki to talk and to show you were interested; your body posture was open and non-threatening. You gave lots of motivational and supportive comments which certainly helped to show Becki that she was appreciated and supported. Very helpful and willing to meet her needs although in the real world, a line manager may not be so accommodating!
Invite, and deal with, candidate questions.
Invited Becki to ask questions and self-reflect – responded to these
thoughtfully and constructively
Identify any development needs and actions.
Learning and development needs were touched upon but not explored fully – a more detailed discussion would need to take place regarding the ‘sales course’ and her longer term career ambitions once she was ‘back on track’. Advise asking the reviewee if they had any objectives to bring to the table before outlining yours!
Conclusion and summary
A clear account given of actions going forward and kindly informed that she would get £500 bonus even though sales had dipped – nice touch!
Conduct meeting within legal and ethical requirements.
Legal and ethical considerations were duly adhered to.
Advise to take notes during the meeting – doubt you would not remember all the key points without them!
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