Royal Insurance Corporation of Bhutan Performance Management System (PMS) User Manual

Transcription

1 Royal Insurance Corporation of Bhutan Performance Management System (PMS) User Manual RICB Ltd. PMS User Manual 1 P a g e

2 RICB Ltd. PMS User Manual 2 P a g e

3 A Scorecard based Performance Management System (PMS) is hereby being designed and introduced at Royal Insurance Corporation of Bhutan and the new system would be effective from the current Financial Year The new PMS is designed to enable individuals to effectively manage self and team performance and ensure alignment with RICB s vision and business objectives. This docket has been prepared to help you through the PMS process. The docket consists of the following sections: Section I Introduction provides a brief introduction to the Performance Management System and Process for RICB Section II PMS Process Guidelines This Section details the process guidelines for the subprocesses of the proposed performance management system and the roles & responsibilities for the participants of performance management system Section III Frequently Asked Questions (FAQs) This section addresses a series of frequently asked questions that one may have during the Performance Management Process. Please consult your Superior, Head of Department or the Head - HR for any further clarification in this regard. (This space has been intentionally left blank) RICB Ltd. PMS User Manual 3 P a g e

5 Introduction to PMS RICB Ltd. PMS User Manual 5 Page

7 What is Performance Management System Performance Management System translates an Organization s philosophy, mission, strategy, values and culture in an actionable way and cascades them throughout the organization Performance: It is the set of outcomes / results delivered by the entity / individual in relation to a pre-defined desired objective or goal Performance Management: The ongoing process of defining, measuring, improving and sustaining performance Performance Management System: System to manage the performance of an organization and its employees by executing well defined processes with clear inputs, outputs, timelines and responsibilities The Perspectives of a Scorecard And we will keep/get more business FINANCIAL How do we create value for our shareholders? Scorecard Perspectives CUSTOMER How do our customers perceive us? Then customers (internal & external) will be delighted Do the right things well PROCESS IMPROVEMENT Which processes can add more value? LEARNING & GROWTH How must our organization learn and improve? If we have the right skills and technology Objectives & Measures would be identified across all the above perspectives to ensure alignment of the Corporate objectives to Departmental and ultimately each individual within the department RICB Ltd. PMS User Manual 7 P a g e

8 Key Definition of terms used in subsequent sections Term Appraisee Appraiser Reviewer Definition The person whose performance will be assessed in a given performance period The person whom an Appraisee directly reports to and who would do an assessment of the Appraisee s performance The person to whom the Appraiser reports to or any other person who has been identified as Reviewer. Performance is defined by Key Result Areas (KRAs) Key Result Areas (KRAs) Key Performance Indicators (KPIs) KRAs refer to Broad Objectives that must be achieved by the individual to support the Organization / Department to accomplish their objectives KPIs are measures that help determine achievement of KRAs Quantitative KPIs are directly observable & measurable; Qualitative KPIs are not directly measurable KPIs are prioritized by assigning Weightages Weightages Weightages are allocated depending on the relevance/ criticality of the KPI and the effort required to accomplish the same Range of weightage should vary between 5% to 20% Targets Targets are defined for each KPI to clearly outline what has to be achieved Targets quantify KPIs and reduce subjectivity in performance review Action Plans Competency / Behavioral Attributes Action Plans detail the specific steps, milestones and resources planned for achieving the Target set for an outlined KPI or an identified development need Mix of knowledge, skills and attitude which are observable, measurable and coachable and which enable an individual to perform his/her job more effectively (Please refer to detailed competency Model designed for RICB) Supporting Incidences Instances during the performance year, where the Appraisee displayed behavior(s) aligned to the behavioral attributes while pursuing job related tasks and responsibilities RICB Ltd. PMS User Manual 8 P a g e

9 Example: WHAT HOW Objective = KRA Measure = KPI Value / Target Weight-age Action Plans Increase in Operating Margins for department 20% 10% Reduction of Cost per customer % adherence to budgets 90% 10% Standardize & Streamline processes % reduction in errors & omissions in underwriting & claims process 10% reduction 5% (This space has been intentionally left blank) RICB Ltd. PMS User Manual 9 P a g e

10 Performance Cycle as per the new PMS for RICB Grievance Redressal Linkage to Training & Development Nov / Dec: Organization / Business Performance Planning Dec / Jan: Departmental Performance Planning Dec: Year End Appraisal and Final Rating post Moderation & Feedback Jan / Feb: Individual goal setting for the appraisal year Ongoing Coaching and Feedback on Performance June: Mid-year review (without performance rating) Key Stages in the Performance Management Cycle Performance cycle is the period starting from January 1st to December 31st of the year for every employee. The Performance Management Cycle would comprise of three stages: I. Stage 1: Individual Goal Setting II. III. Stage 2: Mid Year Review Stage 3: Year End Appraisal RICB Ltd. PMS User Manual 10 P a g e

11 Process Guidelines RICB Ltd. PMS User Manual 11 P a g e

13 Process Guidelines for Individual Goal Setting The process of Individual Goal Setting would be for Functional and Behavioral Performance. Both areas of performance would contribute to individual s overall Performance. Individual Goal Setting Functional Performance Behavioral Performance 80% Weightage 20% Weightage The process for Individual Goal Setting would be as follows: Timeline: Jan-Feb Facilitate initiation, conduct and closure of the process and remove roadblocks, if any HR Distribution of PMS Forms & Supporting docs (Scorecards, Model) Record individual KPIs, targets & action plan Reviewer Validate the targets and Action Plan Appraiser 1-1 discussion with Appraisee to review individual goals, action plan & suggest changes, if any Review & Sign-off Appraisee Fill in KPIs, targets & action plan against KRAs; Document Behavioral Perf. Make requisite changes Start of Process End of Process RICB Ltd. PMS User Manual 13 P a g e

14 Role of an Appraisee: 1. Refer to the forms & formats designed for the PMS Process; Seek clarifications as required 2. Refer to the Corporate Scorecard, Department Scorecards and understand the key priorities for the given year 3. Fill out the Individual details in the section provided in the cover sheet 4. Identify, in discussion with the Appraiser, the KRAs and KPIs that would be relevant for the current Performance Cycle as per Departmental Plans and Priorities (Appraisee and Appraisers are encouraged to refer to the Directory of KRA-KPI available with the HR department to select relevant KRA-KPIs as per the role of the Appraisee and Departmental priorities of current performance cycle) 5. Discuss with the Appraiser to define Targets and weightages for the identified KPIs for the performance year. Weightage help attach required level of importance to the KPIs (Weightage should not be below 5% and not more than 20% on any KPI) 6. Detail out an indicative Action Plan highlighting the key steps required to enable the achievement of the target (Optional) 7. Understand the desired proficiency level for each behavioral attribute / competency which have been detailed in the Competency Appraisal Format 8. Submit filled-up target setting form to the Appraiser Role of an Appraiser: 1. Guide the Appraisee to understand departmental scorecard / plan and priorities for the current performance cycle so that the applicable KRA and KPIs are selected from the KRA-KPI directory 2. Guide the Appraisee to understand and appreciate the Targets and Weightages for each KPI 3. Review the KRAs, KPIs, weightages and targets set by the Appraisee and ensure alignment to department level objectives and suggest changes (if required) 4. Ensure adequate degree of stretch in the targets across all reportees RICB Ltd. PMS User Manual 14 P a g e

15 Role of a Reviewer: 1. Ensure alignment of all KRAs and Targets set by individual employees in the department to the departmental and organization level objectives and targets 2. Ensure consistency and fairness with regard to target setting across employees (degree of stretch etc) Sample Illustrative: Appraisee Sign-off Appraiser Sign-off Reviewer Sign-off (This space has been intentionally left blank) RICB Ltd. PMS User Manual 15 P a g e

16 Process Guidelines for Mid Year Review The process for Mid-year Review would be as follows: Timeline : June HR Initiate mid year review process Facilitate initiation, conduct and closure of the process and remove roadblocks, if any Record midyear review In case of exceptional circumstances Reviewer Appraiser Provide feedback on performance & competencies Discuss areas of improvement & action plan Approve plan revision if warranted Appraisee Conduct selfappraisal on individual goals & review action plan Submit self appraisal Request revisiting performance measures / targets Discuss and make necessary changes Start of Process End of Process Role of an Appraisee: 1. Assess own performance on KPIs and document the relevant achievement figures 2. Record supporting incidences against identified behavioral attributes 3. Discuss mid-year performance with the appraiser highlighting Key achievements in the previous 6 months Areas of concern (if any) Change in action plan required Key resource requirements for successful achievement of plan 4. Request discussion with Appraiser for target revision (if required under exigencies) 5. Document the discussion in the Mid-year Discussion Form in the PMS Format RICB Ltd. PMS User Manual 16 P a g e

17 Role of an Appraiser: 1. Guide the Appraisee to do an effective self appraisal 2. Provide constructive feedback and counseling to the Appraisee highlighting Notable achievements in last 6 months Feedback on performance based on mid-year results Display of desired behavioral attributes Change in action plan required Key improvement areas 3. Approve and validate changes in weightages/targets for Appraisee in discussion with the Reviewer (in exceptional circumstances) 4. Document the discussion in the Mid-year Discussion Form in the PMS Format 5. No rating needs to be given during mid-year 6. Submission of Mid-year review form to HR (post validation of the Reviewer) Role of a Reviewer: 1. Review and validate changes in weightages/targets in Appraisee s form in discussion with the Appraiser (in exceptional circumstances) and document these changes in the target setting form. The original weightage/target should be documented in the comments section, along with the reason for the change. 2. Identify specific individuals who might require feedback on Performance due to significant gap in achievement 3. Identify areas and individuals who need to be recognized and appreciate their performance (This space has been intentionally left blank) RICB Ltd. PMS User Manual 17 P a g e

18 Illustrative: Functional Mid-year Review To be filled by Appraiser To be filled by appraisee Illustrative: Behavioral Mid-year Review This section to be filled by Appraisee This section to be filled by Appraiser RICB Ltd. PMS User Manual 18 P a g e

19 Process Guidelines for Year-end Appraisal The process for Year-end Appraisal would be as follows Timeline: December HR Record performance rating for moderation Facilitate initiation, conduct and closure of the process and remove roadblocks, if any Reviewer Validate and overall performance rating, resolving discrepancies, if any Appraiser Appraise the appraisee on targets & behaviors Determine Overall Performance Rating Appraisee Complete self-appraisal on targets & behaviors and submit to Appraiser Start of Process End of Process Role of an Appraisee: 1. Assess own performance on KPIs and document actual achievement figures based on MIS or other authentic data sources. Enclose the data sheets as supporting documents. 2. Rate the actual achievement and document Self Rating 3. Record supporting incidences against identified behavioral attributes 4. Discuss year-end performance (key achievements, challenges faced and expectations on support or individual development) with the appraiser Role of an Appraiser: 1. Guide the Appraisee to do an effective self appraisal 2. Validate data of actual achievement provided by the Appraisee 3. Assess Performance of Appraisee and document the Appraiser s Rating (please provide comments at places where Appraiser s rating is lower than Appraisee Rating) RICB Ltd. PMS User Manual 19 P a g e

20 4. Calculation of overall performance rating for individual Appraisees and submission of the same to the Reviewer 5. Provide constructive feedback and counseling to the Appraisee post moderation of ratings. The feedback need to include Feedback on performance based on year end results Appreciation on display of desired proficiency levels on behavioral attributes Articulation of appraisee s key strengths and areas of development Development plan for the Appraisee Role of a Reviewer: 1. Map Appraiser Ratings with the Distribution of Rating (moderation curve) obtained from the HR department 2. Review specifically the very high and very low ratings and understand supporting incidences to validate the same 3. Revise the Appraiser Ratings if required in discussion with the Appraiser as an attempt to ensure consistent stretch across all employees being reviewed and to fit the Moderation Curve 4. Submit the final Ratings to the HR department for Moderation 5. Support the Moderation committee finalizing the Ratings (particularly the very high and very low ratings) 6. Communicate the Final Rating post moderation to the Appraisers so that they could in turn communicate that to the Appraisees 7. Support handling of any specific case of Grievance between the Appraisee and Appraiser (This space has been intentionally left blank) RICB Ltd. PMS User Manual 20 P a g e

21 Rating Guidelines: For Functional Performance: Proposed Performance Rating Descriptors (as per Performance Management System, FY 12) <65% of the target 65%-75% of the target 75%-90% of the target 90%- 110% of the target >= 110% of the target Rating Guidelines: For Behavioral Performance: Rating Description Significantly exceeds expectations Employee performs as a model of excellence for his/ her position. The performance is consistently exemplary under challenging conditions and surpasses all expectations in this area to a degree deserving particular recognition Exceeds expectations Employee exceeds expectations from the role. Employee demonstrates good performance and overcomes challenges on the job Consistently meets expectations Employee consistently demonstrates effectiveness in this area. He/ she makes a strong contribution to the job through fully satisfactory performance in the area Meets most expectations Employee generally meets most expectations in this area. This is a satisfactory capability level with the need for continued development Meets expectations partially Employee has performance deficiencies that needs improvement in order to meet expectations fully from his/ her position Illustrative: Self-Appraisal (Functional) RICB Ltd. PMS User Manual 21 P a g e

22 Illustrative: Self Appraisal (Behavioral) Illustrative: Functional Appraisal by Appraiser Illustrative: Behavioral Appraisal by Appraiser (This space has been intentionally left blank) RICB Ltd. PMS User Manual 22 P a g e

23 Illustrative: Rating Calculations Average Performance Score (Weightage 80%) Strategic Objectives Weightage Score Weighted score KPI 1 20% KPI 2 30% KPI 3 10% KPI 4 40% Average Performance Score 3.4 Average Performance Score = Weighted average = 3.4 Average Behavioral Score (Weightage 20%) Competencies Score C1 C2 3 4 C3 4 C4 3 Average Competency Score 3.5 Overall Performance Rating Average Competency Score = Simple Average = 3.5 Overall rating after taking into consideration APS & ABS = 3.42 (3.4x.8+3.5x.2) (This space has been intentionally left blank) RICB Ltd. PMS User Manual 23 P a g e

24 Process Guidelines for Moderation The process for Moderation would be as follows: HR Facilitate initiation, conduct and closure of the process and remove roadblocks, if any Initiate moderation process Recording of moderated rating Reviewer Classifies appraisee s as per organizational performance curve and conducts moderations across the various clusters Appraiser Receipt of final rating of appraisee post moderation Appraisee Communication of final rating Start of Process End of Process The Rating would be communicated post the Moderation process is completed. (This space has been intentionally left blank) RICB Ltd. PMS User Manual 24 P a g e

25 Process Guidelines for Grievance Redressal The process for Grievance Redressal would be as follows : Facilitate initiation, conduct and closure of the process and remove roadblocks, if any HR Forward to Moderation Committee Reviewer Discussion with appraisee, if grievance not resolved, the forwarded to Moderation Committee Appraiser Receipt of final modified performance rating of appraisee Appraisee Raise appeal against final performance rating Start of Process Communication of final modified performance rating End of Process Employees are requested to approach the Grievance Redressal committee with adequate data / information supporting their cause. HR and Grievance Committee will only take grievance over one s own rating and no requests on comparative rating justification would be addressed. (This space has been intentionally left blank) RICB Ltd. PMS User Manual 25 P a g e

27 Frequently asked questions (FAQ) RICB Ltd. PMS User Manual 27 P a g e

29 Target Setting Q. Will my Performance Measures be shared with others in my department? Apart from you, the only people who would have access to your measures would be your Appraiser, Reviewer, Head of Department (HoD) and HR Department. Q. Who ensures that the same level of difficulty is set in the targets of other members of the team/department? Your Appraiser and Reviewer will ensure that the degree of difficulty in your targets is the same as that of the other members of the team/department. Q. What if the Appraiser changes in the middle of the Performance Period? Change in Appraiser will not impact your Performance Measures. However in case of Year End Appraisal, your previous Appraiser and your new Appraiser will sit together to provide ratings against the targets and arrive at your Performance Rating. In case the Appraiser is leaving the Organization, HR needs to ask the Appraiser to provide his Review for each of his Appraisees till that date. However under all circumstances the ownership of Appraisal would lie with the current Appraiser. Q. What happens if I get transferred during the Performance period? If you have occupied a role for a period less than 3 months, the same will not be considered while computing the Overall Performance Rating. Else a time weighted average of your performance scores for each role will be taken to arrive at the Overall Performance Rating. Mid Year Review Q. Does a formal discussion have to take place during the Mid Year Review? Yes, the Mid Year Review is a formal discussion between the Appraisee and the Appraiser to review previous 6 months performance against the targets set at the start of performance cycle. This opportunity is used by Appraisers to provide feedback to Appraisee on his / her strengths and weaknesses and also support in setting-up of action plans for next 6 months so as to achieve the target. Q. What happens to my Mid Year Review session document? The outcomes of the Mid Year Review are documented and will be used as a reference at the time of Year End Appraisal. RICB Ltd. PMS User Manual 29 P a g e

30 Q. Is it possible that my targets get changed during the course of Performance Cycle? Yes, the targets may get changed under various circumstances like a. Change of Role within the Department / Promotion to a higher role b. Transfer to another department or to another location c. Change of Business Plan under exceptional circumstances d. Other external parameter affecting performance Q. What happens if my Targets are changed during the course of Performance Cycle? The changes in Targets need to be properly documented in the same form which was used for Target Setting and the changes shall be recorded with due justification of the reasons there under Year End Appraisal Q. What happens to my self-appraisal after I ve submitted it to my Appraiser during the Year End Appraisal? Your Self Appraisal will be an opportunity for you to share your perspective on performance with your Appraiser. It will not directly contribute to your Overall Performance Rating. Your Appraiser will take cognizance of the same, when he/ she discusses with you on your performance. Q. How do I prepare for the Year End Appraisal session? Preparation for Appraisee: Review your own performance and complete the self appraisal section of the appraisal form Collate data on areas of performance/ non performance Consider own developmental needs based on activities you would like to participate in and skills and knowledge you would like to develop Preparation for Appraiser: Collate data on areas of performance/ non performance for the Appraisee Calculate the overall performance rating Lay emphasis on a two way discussion Consider development needs of the Appraisee RICB Ltd. PMS User Manual 30 P a g e