Professional Documents
Culture Documents
Prepared For:
Homayara Latifa Ahmed
Assistant Professor
IBA, University of Dhaka
Prepared By:
Saleh Ahmed ZR-46
Zareen Tasnim RH-83
Arefin Rezwan ZR-
21 June 2015
Institute of Business Administration
University of Dhaka
Performance Management
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Executive summary:
Theoretically, performance management is the process by which managers and
employees work together to plan, monitor and review an employee's work
objectives and overall contribution to the organization. It includes activities
which ensure that goals are consistently being met in an effective and efficient
manner.
But in real life, in most cases, performance management is synonymous to
performance appraisal which consists of a checklist of criteria to be met based
on which employees are fired or promoted. Bangladeshi companies, too, apply
the aforementioned method of performance appraisal to evaluate employee
performance rather than actually managing the performance of its employees.
Moreover, in many organizations, especially start-ups, creative agencies and
small firms, there is no definite method of performance management.
Nilavo Technologies Ltd. is a small local IT firm which develops software and
exports them to clients abroad. Being a highly technical and flexible firm, with
a small workforce, it has no structured, observable or defined method of
evaluating performance of its employees. As such, we have looked into the
organization and its industry, and importantly into its employees and the context
of their jobs. We have also looked into the current performance management
processes practiced in the company. Based on all these factors, we have
identified some challenges of the company and aimed to re-structure and redefine its performance management system to alleviate these challenges.
Moreover, we have aimed to align the organizational goals and employee goals
to help the organization realize its vision of sustainable growth.
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Table of Contents
1
Organizational Background...........................................................................................................5
1.1
1.1.1
Technical:.......................................................................................................................6
1.1.2
Non-technical:................................................................................................................6
Business model..............................................................................................................................7
2.1
Project duration:.....................................................................................................................7
2.2
Workflow analysis:................................................................................................................7
2.3
Project specifications:............................................................................................................8
2.3.1
Client specifications:......................................................................................................8
2.3.2
Work plan:......................................................................................................................9
2.3.3
Work assignment:...........................................................................................................9
2.3.4
Definition of job:..................................................................................................................11
3.2
Definition of performance:...................................................................................................11
3.3
3.4
3.4.1
Continuous monitoring:...............................................................................................12
3.4.2
Performance review:....................................................................................................12
3.5
Career planning:...................................................................................................................13
3.6
Other benefits:.....................................................................................................................13
External challenges:.............................................................................................................14
4.2
Internal challenges:..............................................................................................................14
Performance planning..........................................................................................................15
5.1.1
5.1.2
5.1.3
Strategic map:..............................................................................................................16
5.2
5.2.1
Performance analysis:..........................................................................................................17
Key performance areas (KPAs):...................................................................................18
5.3
5.4
Performance development....................................................................................................21
5.5
Performance audit................................................................................................................21
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1 Organizational Background
Nilavo Technologies Limited is a local firm which operates in the IT sector of Bangladesh and
specializes in software development. Established in 2006, it is a private limited company. It is an
export firm and mainly serves a single client company based in USA. It does not cater to any local
client in the country and so its whole revenue is generated from export. It is located in Banani, Dhaka.
The vision of the company is achieving sustainable growth. And its mission is to maximize client
satisfaction by providing superior quality work and staying true to its commitments.
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1.1.2 Non-technical:
This category consists of the following people:
a) Administration (including finance and HR): the personnel in this section are:
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Business model
The company caters to a single client and develops software products for that client. They mainly
focus on developing new upgraded versions of the original products. Thus the company receives
projects from the same client on a regular basis. The client also demands completely new product
development projects, but on a lower scale.
The company receives contract for each project from the client and the client is billed based on an
engineer/month (per engineer per month) rate.
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The CTO divides the project into different major tasks and stages. A number of tasks have to
be completed within a particular stage, within a particular deadline. CTO assigns major tasks
to Project Manager and Project Leads.
They break the tasks down to smaller component tasks and assign to other engineers as
required. Here, the criteria on which job assignment of each engineer is based are:
a) capability and specialized skills for the particular task
b) previous experience in similar task
c) previous performance of similar task
Each component task has a particular deadline. The completion of each component task,
within the designated deadline, is known as milestone.
Multiple teams of engineers are formed based on the component tasks, and each team
performs only the specific component tasks assigned to them.
Deadlines have to be met strictly and stringently as all the smaller work units (tasks and
stages) are interconnected and delay in one segment will have a drastic effect on other
segments.
Project Leads monitor the different teams and they report to the Project Manager, who in turn
reports to the CTO.
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These stages along with their associated components are described below:
2.3.1 Client specifications:
Since the firm deals with technical product, detailed and highly specific requirements are given by the
client. This is known as client specifications and the final product has to meet each and every criterion
mentioned in the client specifications. It also includes a deadline given by the client within which the
product has to be delivered.
2.3.2 Work plan:
The client specifications serve as the framework of the whole project. Based on it, a work plan for the
whole project is prepared by the CTO and Project Manager in the very beginning. This work plan is
followed throughout the whole span of the project and covers all the tasks required to complete the
project. The work plan includes:
Tasks are primarily assigned based on the nature of work and how well it matches with the specialized
skill of an engineer. Besides, an engineer who has done the same type of work is preferred for that
particular work.
The tasks which are very difficult, crucial and/or have to be completed within a very short time are
assigned to the senior engineers.
QA mentality can be described as the dedication and perseverance to check and re-check a finished
task unit or module repeatedly to find errors or loopholes. In contrast, development mentality is the
mentality to finish a work as efficiently and quickly as possible to meet the requirements. Quality
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assurance, the second phase of a task module, entails more critical work and requires engineers who
possess QA mentality. Thus the tasks under quality assurance stage are assigned to a few senior
engineers only.
2.3.4 Implementation and monitoring:
From the technical point of view, each module has two major aspects based on the type of work.
These two aspects entail distinctive and different group of tasks, and thus are carried out in two
separate phases, one after the completion of other. These phases are:
Phase 1: Software development
Phase 2: Quality assurance (QA)
These two phases are described below:
2.3.4.1Phase 1: Software development
The firms projects can be divided into two categories. These are:
The software development phase varies according to these two categories. This phase mainly consists
of developing the programming codes for various aspects of the product. Engineers are provided a
detailed written list of the tasks and requirements and they develop the codes accordingly. Once they
finish developing the codes for that particular module, they submit the codes and the QA phase
begins.
2.3.4.2Phase 2: Quality assurance
QA entails checking the developed software to ensure that it meets client expectations and quality
standards of the firm, industry and client. QA consists of the following segments, in this particular
order:
Test cases are developed in this phase to check the functionality and quality. Test cases are programs
and codes that determine whether the developed software performs properly in different case
scenarios relevant to the product usage. The test cases have only two options-pass and fail. If the
software operates properly, it passes. If any glitch is present in the software, it fails in the test case and
is sent back to the development phase for correcting that problem.
In this way, numerous test cases are developed and implemented. And a particular module is tested,
sent back to the development phase for modification and tested again in QA. This cycle is repeated
again and again till the module passes all the test cases. The test cases are first carried out manually
and then automated to increase efficiency and reduce scope of error.
After each unit module is tested and receives QA clearance, regression testing is done. Regression
testing checks if each unit module functions properly with respect to other modules when combined in
a single product. Regression testing also involves test cases and other measures. After rigorous
regression testing, the final product, including all the modules incorporated together, receives QA
clearance.
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2.3.4.3Monitoring:
The Project Manager leads, coordinates and monitors throughout the whole project. The two Lead
Engineers are responsible for the two phases namely software development and quality assurance
respectively. These three positions are constant for every project and the same three people carry out
these responsibilities respectively.
The Project Manager and the two lead engineers report to and consult the CTO.
Throughout any project, review sessions are held at regular intervals to discuss the progress and
problems of the work completed till then. The CTO, Project Manager and Lead Engineers sit with
teams of each module in these review sessions. The frequency of these review sessions depend on the
difficulty, novelty, and urgency of issues of the task modules.
2.3.4.4Review:
Once the final product receives QA clearance, it is submitted. After submission, team distribution of
the product occurs. In this stage, the product is used by the firms engineers for a few days to see if it
works correctly. If it functions properly in the team distribution, it is given to the client for feedback.
After receiving client feedback and making necessary alterations, if asked by the client, a Beta or test
release of the product is done. Here, the product is used by some real-time, live users. If the results of
this Beta release are positive, the product is considered ready to be delivered to the client.
2.3.4.5Delivery and maintenance:
Final delivery is made to the client and all maintenance services are provided and managed by the
firm. The payment is received after delivery.
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Continuous monitoring
Performance review
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Provident fund, 50% from salary of employee and 50% provided by the company
Leave Fare Assistance
Medical insurance
Transportation
Allowances for internet and phone
Lunch allowance
Referral bonus (50% on appointment of candidate and 50% after his 6 month completion)
Longevity bonus (bonus given due to staying with the company for a particular period)
Festival bonus
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The challenges of the organization can be divided into two groups, namely external environmental
and industrial challenges and internal organizational and interpersonal challenges. They are described
below:
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Dependence on senior employees: Since the higher positions of the employees are based on seniority
along with competency, the company is highly dependent on these 2-3 engineers. Besides, due to
more long-time connections with the management, the opinions of the senior employees are given
more importance. This can have a major impact in the performance review system as it is the process
is subjective.
Ineffective peer review: Since it is a team-based workplace, proper peer reviews are required to
identify the role of individuals in any disruption in the team performance. Since, the number of
employees is quite low and everyone is familiar with everyone, the employees are reluctant to notify
the senior employees of any negatives about their peers. This may result in problems remaining
unsolved.
Lack of specific standards and criteria: As there are no specific job or performance definitions, the
evaluation of performance is highly subjective. For example, what constitutes good performance or
very good performance has no definite standards. This has an impact on performance review and
employee satisfaction as bonuses and promotion are given on the basis of performance comparability
of different employees. Since the judging criteria are not visible to the employees, they may not agree
with the results of performance review.
Analyzing the challenges faced by the company, we identify the main problems, in terms of
performance management and thus the overall organization to be the following:
PERFORMANCE
MANAGEMENT
SYSTEM
PERFORMANC
E PLANNING
PERFORMANC
E ANALYSIS
PERFORMANC
E APPRAISAL
PERFORMANC
E
PERFORMANCE
MANAGEMENT
Here, we take the performance of the core employees, engineers (senior, software, junior) from both
software development and quality assurance categories under consideration. Each of these phases for
managing performance of these core engineers are discussed below:
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FINANCIAL PERSPECTIVE:
CUSTOMER PERSPECTIVE:
INCREASE
REVENUE
INCREASE
REVENUE
PORTFOLIO
INCREASE
CUSTOMER
SATISFACTION
INCREASE
CUSTOMER
AWARENESS
INTERNAL PERSPECTIVE:
INCREASE
EFFICIENCY
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IMPROVE
COMMUNICATION
AND STANDARS
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Thus, if we improve the communication and standards for defining and measuring performance,
comparability would be easier and more transparent. And observability and knowledge of the criteria
would lead to greater employee satisfaction. Moreover, there would be less scope of bias and it would
decrease the dependency on sole opinions of the senior Project Manager.
Besides, this would help define performance and what constitutes good or bad performance. This in
turn would help to increase the efficiency of the organizational process by establishing clearly what
performance means and what the KPIs are.
5.2.1 Key performance areas (KPAs):
Although it is a project based organization and the nature of work differs, these are the critical
parameters i.e. which could be considered for measuring performance of both the software and quality
assurance engineers. And these critical parameters could be grouped under two KPAs. These are:
Individual performance
Team performance
Each KPA consists of a number of critical criteria which are the key performance indicators or KPIs to
measure the behavior and performance of the engineers. They are given below:
5.2.1.1a) KPA: Individual performance
Associated KPIs;
The KPIs under individual performance are related to the performance of each engineer, irrespective
of others, and include quality, output and input aspects.
Solidity of work: The solidity of work KPI refers to quality of the programming code and number of
bugs or errors present in the software.
Each task can be completed in various methods of programming. But there are some ways which are
more efficient, effective, competent and safe. These methods by which the tasks are done determine
the quality of the programming code. Moreover, the number of bugs increases the risk factor of the
work. Thus this KPI is the most important of all and would carry a higher weight.
Timeliness: The timeliness KPI refers to whether deadline is met or not.
As the tasks are highly interrelated, delay in one deadline will delay the whole process. Thus the
nature of the work is very time-sensitive and timeliness is a crucial criteria.
Efficiency: This KPI refers to how much of a particular task is done within a fixed period of time.
The deadline given for completion of a particular task is the maximum time which is required by an
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employee to complete the task. Although the deadlines are set to ensure a certain level of efficiency
from the employees, they are realistic too and contain a time margin for error fixing or delay. Thus
there is scope of meeting varied degrees of efficiency within the deadline. And so, it can be a KPI to
measure good performance.
Level of understanding instructions: This KPI refers to how well and accurately a member
understands the written task description and instructions.
Each task has very specific instructions. These instructions are in a detailed written format based on
client specifications and work assignment according to CTO and Project Manager. It is very important
that the engineer understands this written brief on his own and completes the task accordingly.
5.2.1.2b) KPA: Team performance
Associated KPIs:
The KPIs under team performance address both the behavioral competencies for team work and also
interpersonal or dyadic factors.
Team spirit: The KPI of team spirit refers to how well the member adapts and works cohesively with
the group. It also refers to the extent an employee contributes towards completing the team objective.
As the tasks are interdependent and hence, the employees are interdependent and team spirit is thus a
very important KPI.
Cooperation: This KPI refers to how much the member helps others, especially junior engineers to
solve problems they may be facing in coding or fixing errors.
As the tasks are technical and each task is different upto an extent, this would act as coaching for the
junior employees. And this would also help build better interpersonal relationship between the people.
Tolerance and responsibility: This KPI refers to the extent an employee is tolerable of others
mistakes and how he deals with them. Besides, it also refers to the extent an employee takes
responsibility for any error of the sub-team or dyad and the way he deals the situation.
As this is a small organization, with interdependent task and jobs, having a good, healthy and friendly
environment is extremely important. And thus this KPI would help determine an employees role in
maintaining that environment.
Some of the facilitating and inhibiting factors, attributable to the individual, seniors, subordinate or
juniors, organization and its systems and work environment, affecting the performance of the
employees are given below:
Facilitating factors:
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Inhibiting factors:
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5.3.1.4Evaluation method:
Behaviorally rated anchor scales, BARS would be used to measure the KPIs. and the results would
form the basis for bonus, increment in salary. Besides, the results of continuous monitoring as per the
Project Leads and Project Manager would be taken into account.
For the peer evaluation, ranking could be used with a comments section to explain the answers.
Besides, subjective judgment regarding behavioral competency and results of self-evaluation forms as
provided by the CTO and senior employees, as mentioned above, will be taken into account for career
planning and successor planning.
5.3.1.5How review takes place:
The existing methods for self-review, review by Project Manager, Project Leads and CTO, as
mentioned above, would be used i.e. confidential e-mail for self-review, discussion of employees with
Project Leads and discussion for Project Leads, Project Managers and CTO. The new addition, the
peer review form would be confidential and handed over to the Project Manager.
5.3.1.6Feedback:
The feedback method would remain the same i.e. immediate feedback at any time of work as
continuous monitoring is done. Besides, open discussion with Project Manager and CTO after
performance review, as mentioned before, would still be in place.
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6 Works Cited
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