PERFORMANCE MANAGEMENT AND

APPRAISAL
ASSIGNMENT # 2
IDEAL VS ACTUAL PERFORMANCE
SYSTEM
COMPANY: CARGILL

SUBMITTED TO:
SIR SHAHID
MIRZA

SUBMITTED BY:
HOORIYEH ALI

11/02/2017
TOC
HISTORY OF THE COMPANY
Cargill was founded in 1865, and is an American privately held global
corporation based in Minnetonka, Minnesota. Currently, it is the largest
privately held corporation in terms of revenue in the United States. The
organization has diversified in numerous sectors, such as Food and
Beverages, Pharmaceuticals, Transportation, Risk Management, Energy and
Industrial, and most importantly in the Agriculture industry, in which it holds
the standing of a world-renowned giant. It also trades, purchases and
distributes in agricultural commodities, energy, steel and transport. The
company mainly operates business to business, and thus is not a household
name. Since it is a family-owned company, any growth or investment is done
from the funds earned by the company, instead of any public financing.

Cargill Vision: To raise living standards around the world by delivering

increased value to producers and consumers.
Cargill Mission: We will accomplish this vision by being the best at
merchandising, processing and distributing agricultural and other
commodities. We will reinvest a substantial amount of our cash flow to
provide needed products and services for our customers, rewarding career
opportunities for our employees and attractive long-term value for our
shareholders. We will be a valued customer of our suppliers and responsible
neighbours in our communities.
Cargill Values:

Integrity - Our word is our bond.

Excellence - Making Cargill the best at whatever it does.
Growth - Creating opportunities for individuals and our businesses.
Teamwork - Pooling individual knowledge and skills through effective
communication to build shared success.
Long-term View - Having the patience and foresight to build
sustainable businesses for the long haul.
Desire to Compete - Seeking to win on an open, level playing field.
 PERFORMANCE MANAGEMENT SYSTEM AT
CARGILL

The performance management system implemented at Cargill is a brilliant

innovation of its time, which disengages itself from the traditional
performance management system of annual reviews and of simply serving
as an administrative procedure, and instead becomes a driver for employee
engagement. Cargill has designed a PM system which reduces complexity
and focuses on employee and organizational development, by introducing
the revolutionary Everyday Performance Management.

The traditional performance management process would focus more on

periodic reviews and rewarding or penalizing according to the performance
exhibited. While in some ways this was an effective strategy, it undermined
the most important part of any performance management system: the
improvement of performance. To counter this, the concept of the Everyday
Performance Management System was introduced by Cargill. The underlying
principles of this system are:

Performance Management is an ongoing process, not a once-a-year

five minute meeting.

The core of effective performance management is shaped by the

relationship between the employee and the manager.

An effective performance management system needs to be flexible in

order to address various business needs.

Ratings should be eliminated, and focus should primarily be on

everyday conversations that set out to improve performance.

Day-to-day performance management activities and practices predict

the quality of performance management at the organization.

The purpose of this new performance management system is to shift

attention from the administrative aspects of the performance management
process to more important goals associated with it, such as employee
engagement, optimizing performance, role alignment with business
strategies, manager effectiveness, etc.
 SPECIFICS

OF
THE EVERYDAY
PERFORMANCE MANAGEMENT SYSTEM
ANALYSIS OF PM SYSTEM AT CARGILL: IDEAL
AND EFFECTIVE?

Characteris
Y/N Definition Comments
tics
Strategic
Individual goals are aligned with
Congruenc
unit and organizational goals.
e
All employees are evaluated.
Evaluations include performance
spanning the entire review period.
Thoroughn
ess All major job responsibilities are
evaluated.
Feedback is provided on
positive/negative performance.
It is readily available for use.
It is easy to use.
It is acceptable to those who use it
for decisions.
Benefits of the system outweigh the
Practicality costs.
Standards and evaluations for each
job function are important and
relevant.
Only the functions that are under
the control of the employee are
measured.
Evaluations take place at regular
intervals and at appropriate
moments.
Meaningful System provides for continuing skill
ness development of evaluations.
Results are used for important
administrative decisions
Detailed guidance is provided to
employees about what is expected
Specificity
of them and how they can meet
these expectations.
Identificati
on of The system distinguishes between
effective effective and ineffective behaviors
and and results, thereby also identifying
ineffective employees displaying various levels
performanc of performance effectiveness.
e
Measures of performance are
consistent.
Reliability
Measures of performance are free of
error.
Measures include all critical
performance facets.
Measures do not leave out any
Validity
important performance facets.
Measures do not include factors
outside employee control.
Employees perceive the
performance evaluation and
rewards received relative to the
Acceptabili work performed as fair (distributive
ty and justice).
fairness Employees perceive the procedures
used to determine the rating and
subsequent rewards as fair
(procedural justice).
Employee input about their
performance is gathered from the
employees before the appraisal
Inclusivene meeting.
ss Employees participate in the
process of creating the system by
proving input on how performance
should be measured.
Performance is evaluated frequently
and feedback is provided on an
ongoing basis.
Appraisal meeting is a two-way
communication process and not
one-way communication delivered
Openness from the supervisor to the
employee.
Standards are clear and
communicated on an ongoing basis.
Communications are factual, open
and honest.
There is an appeals process,
Correctabili through which employees can
ty challenge unjust or incorrect
decisions.
Performance is evaluated
Standardiz
consistently across people and
ation
time.
Ethicality Supervisors suppress their personal
self-interest in providing
evaluations.
Supervisors evaluate performance
dimensions only for which they
have sufficient information.
Employee privacy is respected.