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Organisational Performance Management

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Belinda Yu

on 21 August 2013

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Transcript of Organisational Performance Management

Improving Organisational Performance
Organisational Performance Management
Different views in Managing Organisational Performance
Best Practice
Best Fit
Resource-based view of the firm
Best Practice Approach
".. set of HR practices that can be applied to any context to increase organisational performance and deliver outcomes beneficial to stakeholders, including employees" (Shields, 2007)
Resource-based view of the firm
Bring importance to a firm's internal resources to create a sustained competitive advantage (Barney, 1991)
In your groups, discuss which approach you would use -
Best Fit or Best Practice?
Best Practice Approach
Can be applied to all organisational contexts (Boxall, 1996)
Recruitment, Selection, Employee Involvement
Or just a set of rules that have garnered success before in firms?
Best Fit Approach
Questions the 'best practice' approach
Practices tailored to fit specific firm situations
Strategic HRM activities must be consistent with each other, and linked to the needs of the firm (Van Buren, 1997)
Specific knowledge, skills and abilities that are difficult for other firms to replicate
Four attributes for a sustained competitive advantage: "VRIO"
1. Valuable
2. Rare
3. Imitability
4. Organisation-supported
Managing on the basis of results
Key results areas (KRA)
Distinct area of activity
Key performance indicators (KPI)
Measures KRAs
Focuses on the present
Goals for future achievement
Class Discussion
Given what you know about results-based management, what are some of the strengths and limitations of goal setting?
Goal Setting

Based on "goal setting" theory (Locke and Latham, 1990)
Focuses on self-motivation
Employees involved in decision-making process
Strengths & Limitations for result-based management
Balanced Scorecard
Proposed by Kaplan and Norton (1992)
Focuses on strategic alignment in 4 areas
Internal learning and growth
Internal business processes
Financial (shareholders)
Balanced Scorecard
Seen as "best practice"
Uses multiple measures
Ongoing strategic alignment
Balances financial and non-financial considerations
Balanced Scorecard
Ambitious scope
Top down control device
Limited adaptability
Case Study Discussion
United Fashion wants to increase productivity in its manufacturing and sale areas. However, HR needs to take into account different factors such as location of branches, workers and organisational goals.

I'm going to give each side a view, which you'll discuss on your groups, and then we'll come together to discuss.
Team-based Rewards
Class Discussion

From your own understanding and experience at work/university, do you think team based rewards are a good idea?
Case Study Discussion
Josh has just put together a team of 8 people in a new project. He knows there is a risk of free-riding and social loafing, and around half the team are junior members of the firm.

What are some ways to avoid this free rider problem?
Best Practice vs. Best fit approach
Resource based view of the firm
Result based management
Goal setting
Balanced scorecard
Team based rewards and freeriding
Purpose of performance management
Belinda Yu & Amanda Leong
Class Discussion
Best Fit
HR activities must be consistent with each other (horizontal fit), and linked to the needs of the firm (vertical fit)
Hard to sustain fit in constant environmental instability and uncertainty
Lack of employee interests if solely focused on firm's needs
Best Practice
A set of practices that fit almost any organisational context
Much agreement on best practice, no reinvention needed, established rule of thumb for selection, training
Conflict between firm's benefits and employee benefits, disregarded culture differences, disconnection from firm's goals and context
Thank you for your time!
Employees can see what needs to be achieved
Objective measures
Timely feedback
Single focus may lead to cutting corners
Employees may omit info to give appearance of success
What isn't measured might be forgotten
Human factors may be ignored in favour of results
Auw, E 2009, ‘Human capital, capabilities, and competitive advantage’, International Review of Business Research Papers, vol. 5, no. 5, pp. 25 – 36

Barney, J. (1991). Firm resources and sustained competitive advantage. Journal of Management, 17(1), 99 – 120

Boxall, P. (1996). The strategic HRM debate and the resource-based view of the firm. Human Resource Management Journal, 6(3), 59.

Den Hartog, DN, Boselie, P, & Paauwe, J 2004, ‘Performance management: A model and research agenda’, Applied Psychology, vol. 53, no. 4, pp. 556-569.

Kaplan, R & Norton, D 2007, ‘Using the balanced scorecard as a strategic management system’, Harvard Business Review, July-August, pp. 150-161

Locke, EA & Latham, GP 2006, ‘New directions in goal-setting theory’, Current Directions in Psychological Science, vol. 15, no. 5, pp. 265-268.

Shields, J. (2007) Managing Employee Performance and Reward: Concepts, Practices, Strategies, Cambridge University Press, Melbourne

Van Buren, M.E., & Werner, J.M. (1996). High Performance Work Systems. Business and Economic Review, 43(1), 15 - 23.

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