Human Resource Audit – Performance Management System

Laura BeattyMeredith FrisbieShelby WestbrookZach SmithNorth Carolina State University – MIE436

State Employees Credit Union1

Presentation Overview• Orientation to SECU• What is Performance Management

(PM)?• PM conducted at SECU• How PM is being handled

▫ Strengths▫ Weaknesses

• Recommendations for improving PM▫ Areas in need of improvement▫ How to improve deficient PM

areas▫ Justification/Outcome of

improvements• Conclusion• Questions

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Orientation to SECU• Non-profit financial cooperative• Founded June 4, 1937• "People Helping People in North Carolina." • Limited Membership with approx. 1.5 million members.• Promote thrift among its members by affording them an

opportunity to accumulate their savings.• Creates a source of credit at a fair and reasonable rate of

interest for members.• Provides an opportunity for members to use and control

their money to improve their economic and social condition.

• 4,200 employees , 225 branches, and more than 1,000 ATMs

• Exponential growth rates (State Employees' Credit Union, 2009)

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•Performance Management is the continuous process of identifying, measuring, and developing the performance of individuals and/or teams, with the goal of aligning performance with the strategic goals of the organization. (Aguinis, 2009, p. 2).

What is Performance Management?

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• HR/Personnel Department▫ Centralized internally

• Manages PM through PMS developed in 2001▫ Yearly employee self-appraisals▫ Yearly employee evaluations by

supervisor▫ Progressive discipline policy▫ Limited topic grievance process▫ Performance improvement through

training▫ Documentation of PM actions and

events(Woodson,

2009)

Current PM Practices at SECU

Section IA

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PM’s Contribution to Strategic Goals

• Facilitation of strategic goals ▫ Yearly online evaluations

• Attraction ▫ Education decides salary▫ Scholarships

• Retention▫ Progressive discipline policy

Additional evaluations

• Motivation▫ Modules

Lead to promotions

Section IB

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PM Consistency with Other HR Functions

• Training and Development (Source)▫ Expectations▫ Ongoing process

• Compensation (Source)▫ Wages - based on education and experience▫ Merit pay – Merit pay given in July by board

decision

• Recruiting and Selection (Source)▫ Advertised by the branch▫ Posted internally and externally

(Woodson, 2009) Section IC

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Evaluation of PM Practices by SECU

• Does not have distinctive PM evaluation system▫ Lack on-going, continual process for offering

feedback▫ Only report issues to HR manager when necessary

• PMS not working properly▫ Employees have no input/say in design ▫ System is outdated (not changed since 2001)▫ Just recently , evaluations became electronically-

based

Section ID

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Strengths

• Yearly online evaluations (Steingold, 2009)▫ Easy to use/store/transfer▫ Legal protection▫ Promotion

The Form (State Employees' Credit Union, 2009)

▫ Graphic Rating Scale▫ Short answer section-open-ended

questions▫ Free to ask for feedback at anytime

Section II

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Evaluation FormEMPLOYEE EVALUATION FORM

EMPLOYEE NAME (Last, First, MI)

EMPLOYEE #

POSITION TITLE Designate precisely (ie. Senior Teller, Loan Officer, MSR. etc.)

DATE OF EMPLOYMENT

POSITION STATUS EEXXEEMMPPTT NNOONN--EEXXEEMMPPTT

BRANCH/DEPARTMENT

EVALUATION COMPLETED BY EEMMPPLLOOYYEEEE SSUUPPEERRVVIISSOORR

SUPERVISOR

DATE OF EVALUATION

DATE OF LAST EVALUATION

COMPLETE EACH SECTION THOROUGHLY AND USE ADDITIONAL PAPER IF NEEDED.

1. Note areas of professional development since your last evaluation (training/education). 2. Describe your strengths as they relate to your job duties and responsibilities. 3. Identify areas you could improve to enhance your effectiveness. 4. What would you like to see changed within your specific work area and/or the Credit Union? 5. What suggestions or recommendations do you have for implementing these changes? 6. What are your short-term and/or long-term career goals? 7. List any goals you have achieved or contributions you have made since your last evaluation.

SIGNATURES: X_________________________________________ VP DATE X_____________________________________ EMPLOYEE DATE X_________________________________________ SVP DATE X_____________________________________ SUPERVISOR DATE X_________________________________________ PRESIDENT – SR. EXECUTIVE VP DATE

SECU # 442 A (1/01)

(State Employees' Credit Union, 2009)

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Weaknesses•1) Lack of incorporation of

organization’s mission, vision, and goals into their PMS (Source)

•2) Absence of coaching and feedback in the workplace (Source)

•3) Facilitation of performance appraisal rather than a PM (Source)

•4) Outdated PM practices (Staneart, 2009)

Section II

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Mission•“People helping people in North Carolina”

▫Geared towards members, not employees▫No postings of statement around office▫Needs to include

why the organization exists the scope of the organization’s activities what products and/or services are being

offered

Section III

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Vision• “To challenge State Employees’ Credit Union

to provide opportunities for members to improve their economic and social condition; to encourage thrift among members; to create sources of credit at fair and reasonable rates of interest; and to broaden the economic awareness of members through planned programs of consumer protection”

▫Needs to be more future-focused, motivating, and inspiring to employees

Section III

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Coaching/Feedback Implementation (Aguinis, 2009)

•1) Set developmental goals•2) Identify resources and strategies•3) Implement strategies•4) Observation and documentation•5) Feedback

Section III

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Performance Appraisal• Performance Appraisal (Aguinis, 2009)

▫ Gives a logical description of an employees strengths and weaknesses

• PMS include six steps: ▫ 1) prerequisites▫ 2) performance planning▫ 3) performance execution▫ 4) performance assessment ▫ 5) performance review ▫ 6) performance renewal and re-contracting

• Ongoing

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Outdated PM Practices

Section III

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• Evident by low validity in PM Process (Staneart, 2009)▫ Results from typical arbitrary and

subjective approaches▫ Is the practice related back to the

job performed?▫ i.e. coaching, feedback,

appraisals• Contaminated Material and

Information (Staneart, 2009)▫ SECU is currently using invalid

metrics in measuring performance due to dynamic job nature. (Woodson, 2009)

“All businesses and organizations alike, in order to operate an ideal PMS, require a constant update and improvement in the way they apply certain PM practices, i.e.. appraisals and feedback.”

-Doug Staneart, CEO of the

Leaders Institute

Implementing New PM System• Preparation of New PMS

▫ Achieve system buy-in by employees• Communication Plan

▫ Communicate important factors of implementing a new PMS in an organization and its benefits

▫ Avoid biases, consider employees, promote positive, & document

• Appeals Process▫ Create tiers in the process for advancement of

unresolved issues• Training Programs

▫ Rater Training, RET, FOR, BO, SL• Pilot Testing

▫ Discover problem, fix problems, gain input, sample size• Continuous Monitoring and Evaluation

▫ System satisfaction, cost/benefit, performance level▫ Continuous update of PM practices

Section III

17

Questions/Comments18

References19

Aguinis, Herman. Performance Management Second Edition. Upper Saddle River, New Jersey: Pearson Prentice Hall, 2009.

Cross-Training Boosts Efficiency. CU360, Credit Union National Association, Inc. 7/27/2009, Vol. 35 Issue 13, p6-7, 2p; (AN 43374399), Business Source Premier.

Holley, Don. How to retain good staff. Manufacturers' Monthly, Sep2009, p17-17, 1/4p; (AN 44327636), Business Source Premier.

Noe, R. A., Hollenbeck, J. R., & Gerhart, B. (2007). Assessing Performance and Developing Employees. In J. Weimeister (Ed.), Fundamentals of Human Resource

Management (pp.303-304). New York, NY: McGraw-Hill/Irwin.

Staneart, D. (2009). Is Your Performance Review System Outdated? . Retrieved November 14, 2009, from Business Know-How:

http://www.businessknowhow.com/manage/perfappr.htm

Steingold, F. S. (2009). Personnel Practices. In A. Schroeder (Ed.), The Employer's Legal Handbook (pp. 47-50). Berkeley, CA: Nolo.

Woodson, Bob. Senior Vice President - Personnel and Human Resources Zachary Smith. 20 September 2009.