Performance Management & Job Grading
At this point you may be wondering: what is performance management, and why should I care? Or, you may already have realised and recognized that performance management is a key business practice, but you might be a little sketchy on the details.
Either way, we’re here to tell you absolutely everything you ever needed to know about performance management and job grading.
In essence, performance management is an ongoing process of communication between an employer or manager/supervisor, and an employee aimed at assessing the employee’s performance in terms of their contribution to accomplishing the company’s strategic objectives or goals. You can read more on about the definition on Wikipedia.
Performance management should be distinct from such practices as quarterly or biannual performance reviews, in that performance management should be a year-round practice. There are a number of other practices that may help make implementing performance management, and maintaining an equitable and fair working environment that much easier.
One of these is job grading.
What is Job Grading?
The landscape of South African legislation has continually expanded to encourage more equitable, and fair working conditions.
It has become employers’ prerogative to ensure sustainability not only through conducive business practices, but also by strategically incorporating Broad-based Black Economic Empowerment, Skills Development and Employment Equity initiatives.
Recent amendments to the Employment Equity Act (No. 55 of 1998) illuminate this focused shift towards equitable working conditions; particularly referring to income differentials.
It has now become necessary for employers to prove that differences in wages and salaries are based on fair and objective criteria such as skills, responsibility and experience. A proven method of ensuring this objectivity is by means of job grading.
Job grading allows the employer to empirically demonstrate his or her rationale for offering different levels of pay.
Job Grading is a process of determining the worth or value of one job in relation to, or compared to another regardless of the characteristics or experience of the specific individual occupying the position at any given time.
It involves determining the level of complexity, decision-making, and skills required for each job, which is then categorised accordingly. The most popular method in South Africa is the Patterson grading system whereby jobs are classified in terms of grades A through F.
The Patterson grading system analyses the level of decision-making, work pressure and responsibilities a given role demands of its fulfiller.
Read more about the Patterson Grading System
Approved job profiles slotted into applicable grades allows the company to conduct accurate salary benchmarking; thus helping them to establish market-related salaries for similar jobs and to subsequently define salary bands in line with company policy.
Job grading and salary benchmarking according to objective criteria further promotes the principle of equal pay for equal work.
In addition, it enhances other policies such as efficient salary administration, defined and structured career-path development, and more aligned performance management and staff training initiatives.
Transparent methods such as job grading improve employee relations in that it provides a sound foundation for negotiation and workplace discourse which is substantiated by fair and objective criteria.
Eminent changes to legislation such as the changes to the Employment Equity Act are forcing companies to pay attention to not only how much they remunerate employees, but also to how the salary structures are determined.
Primary Advantages and Benefits of Job Grading include:
- All positions across the whole organisation are evaluated using the same methodology and criteria to ensure that similar work can receive similar pay
- It evaluates specialist roles as effectively as non-specialist roles
- It is internationally recognised, and can be effectively used across multiple territories
- The Job Evaluation results are not decided by one person, but rather based on the findings of a Job Evaluation committee consisting of all relevant role players
- It assists in illustrating the fairness of the current distribution of salaries, or can illustrate the opposite and changes can be made accordingly
- It assists in illustrating the competitiveness of organisational pay scales against market rates
- The role is evaluated as opposed to the person occupying the position
Here at Danshaw Consulting we are able to assist our clients and to help them use legislative compliance to their advantage.
This way we can help our clients make informed decisions regarding structures that ensure equality in the workplace.
Danshaw Consulting uses the Patterson method of job evaluation as a basis for relating levels of complexity in a way in which both management and workers find reasonable, equitable and fair.
Now that’s all well and good, but how can performance management or job grading help me motivate my employees?
Motivating Your Employees Through Performance Management
When an employee views their job as “just a paycheque”, or feels that their hard work isn’t being accurately measured or recognized, it can be difficult to motivate them to go the extra mile.
Job Grading is only one way to ensure that your employees feel that their contributions are being accurately measured. How do you go about motivating unmotivated, lacklustre or frustrated employees or up your employees’ performance overall?
How can improving employee performance help your business?
We’re glad you asked:
Sometimes in order to get a little more you have to give a little more. Introducing performance incentives into the workplace creates an atmosphere of healthy competition which may successfully motivate even those employees who aren’t after the incentive (be it monetary or otherwise).
Incentivizing thus appeals to, and can improve workplace productivity and overall performance of, both those competitive employees who crave recognition, and those who crave the physical incentive reward.
Incentive-driven structures may include commission on sales, or a reward for the employee who has made the most sales, or brought in the most money in a given month.
Pro tip: ‘Employee of the month’-type systems often fail when there is no clear, objective guideline for determining who enjoys the honour – for example, when the decision is made at the manager’s discretion.
These types of reward systems often serve to further discourage those who already feel like their contributions aren’t being recognized, and allows for your employees to suspect and cite nepotism, favouritism and other unethical practices as the reason their competitor won (even if this is not the case).
A reward system, such as an incentive scheme, must then be objectively measurable and the terms of the system and guidelines for it’s implementation must be conveyed to all involved so that the process is as transparent as possible.
Encourage your employees to view one another as colleagues and comrades and not ‘the competition’ by fostering good interpersonal relationships with one another and with management by way of team-building exercises.
Team-building exercises should always be geared toward collaborative problem-solving, co-working and creative thinking in a group.
Pro tip: Know your audience. There are ample team-building opportunities and exercises that can be undertaken in every imaginable environment.
Unless your goal was to unite them against a common enemy (being you) it may not be in a company’s best interest to take a group of asthmatic Suits who hate the outdoors bundu-bashing as a team-building exercise.
Resentment may abound among employees who feel forced to partake in team-building exercises outside of their comfort zone; so choose wisely.
If you’ve been left wondering whether or not your employees are pulling their weight, or how you might begin to determine whether or not their performance is substandard; keep reading!
Understanding Work Performance:
Each position in a company comes with a predetermined set of responsibilities.
If each employee is meeting their requirements based on the position they occupy, the company should be operating at optimum efficiency. These requirements are captured in the job description or profile that provides the foundation based on which potential candidates are selected, interviewed and employed.
However, all too often, employers find themselves with their heads in their hands when seemingly perfect candidates don’t deliver after being appointed.
On paper, everything appears in order and ideal, but a few weeks or months down the line the employee is just not making the grade in terms of their work performance.
TAKING THE RIGHT STEPS
When addressing the matter of poor work performance, Schedule 8, the Code of Good Practice on dismissals, clearly explains the steps you need to follow before dismissing an employee for poor performance.
It should be made clear that unlike matters of misconduct, disciplinary action is not taken against the employee when addressing performance, rather the matter calls for counseling sessions to better understand the reasons behind poor performance, and to determine the steps that need to be taken to ensure improvement.
Schedule 8 requires that prior to dismissing an employee for poor performance an employer must consider the following:
- Determine whether or not the employee did indeed fail to meet the required standard
- If he or she did in fact not meet the standard, was the employee clearly aware of what the performance standards are?
- Was reasonable time given to the employee to improve?
As with other grounds for dismissals, fair procedure and fair reason are critical considerations prior to dismissing an employee.
Dismissal must have been determined to be the only appropriate sanction after measures of progressive discipline were followed, to little or no effect. In the case of poor work performance, fair procedure in practice means consulting with the employee and clearly communicating the areas in which improvement is required and by when such improvement must be evident.
Reasonable time and fair opportunity for the employee to improve is usually determined by the complexity of the job; the more complex the job or the more difficult it is to meet the standard, the longer the time-frame allowed to the employee to demonstrate improvement.
Follow up must be conducted, and the employee’s performance must be evaluated in order to determine whether or not the standards were met. This may require a series of counseling sessions to ensure fair procedure and should not be limited to only one meeting with the employee before determining whether dismissal is the only option should no improvement be demonstrated.
REASONS FOR POOR WORK PERFORMANCE
There may be several reasons for poor performance including stress, lack of qualifications or experience, motivational factors, unclear standards, outside influences, ill health or incompatibility between employer and employee.
Where an employer experiences a high frequency of poor performers, the company should examine the measures in place, or lack thereof, which would minimize the incidents of employees not performing on par with the expected industry standards.
When evaluating company policy, considerations should include: the recruitment, selection and performance management policies of the company.
Does the way candidates are sourced and evaluated provide the level of skills and knowledge required to do the job? Is the role clearly defined in terms of outcomes, and what qualifications, skills and experience are required to be successful in the role?
What tools, assistance and training does the company provide to ensure continued acceptable performance? What performance measures are in place to continuously monitor and review all employees’ performances?
Are regular meetings held with new employees during their probationary period to evaluate their performance?
IMPROVE WORK PERFORMANCE WITHIN YOUR COMPANY
When dealing with probationary employees, many employers suffer the misconception that they may terminate the employee’s preliminary contract once that probation period has come to an end, provided the employee does not perform adequately.
Probationary periods must be approached following the same principles as set out in Schedule 8 where evaluation, feedback and time to improve are done on a regular basis.
Ignoring these steps and dismissing an employee once the probation period expires will be deemed unfair dismissal where no procedure was followed.
Danshaw Consulting is able to: assist employers by facilitating the correct procedures, provide expert advice and implement policies, such as Performance Management, that will minimise labour costs due to counterproductive behaviour by employees.
Visit our website and contact us to find out more about how our services can contribute to your company’s effectiveness.
How, then, can you go about attracting the right kinds of employees from the get-go? And what can your company be doing to support attentive and effective performance management?
Develop an Employee Value Proposition (EVP)!
What is an Employee Value Proposition or ‘EVP’?
An Employee Value Proposition seeks to define the core elements of your company’s values and the unique rewards an employee will reap working for you. In other words, an EVP refers to the unique benefits an employee of the company reaps in exchange for their skills, capabilities and experience.
Why create an Employee Value Proposition?
A well-constructed Employee Value Proposition tells all current and future employees why they should be proud to be employed by the company – incorporating an EVP or increasing an EVP’s visibility throughout the company will help the company retain their top performers and attract new top performers in the future.
Whether your company’s primary selling-point is then an inspiring vision, or a commitment to social development and giving back; putting it into an Employee Value Proposition is good for business!
You can also read how a basic compensation structure looks which can help you create an even better value proposition.
Top Tips for Creating a Stellar Employee Value Proposition
Read Between The Lines
Your first step toward crafting a stellar EVP is going to be to analyse the data you have available.
Whether this means polling current and ex-employees, reviewing transcripts or video of interviews for a position, or going off anonymous complaints and grievances previously filed through HR; you can read between the lines and determine:
Why do people enjoy working for you?
What attracted prospective employees to the jobs they applied for?
Why do people leave the company?
What do your employees think makes working for the company unique?
What do the employees think is the biggest perk of working for the company as opposed to working elsewhere?
Once you’ve gleaned more insight into what your employees consider your business’s strengths and weaknesses in terms of attracting new hires and retaining top performers, and you have a better idea of what your employees perceive as their unique reward for working for the company, you can start thinking about what to include and exclude from your final EVP.
Make sure that the feedback from your employees that you are considering including aligns itself well with your business’s ethical and moral code, vision, mission and strategic objectives.
Construct & Convey
Once you have analysed the data and decided what to include in your final EVP you can go about constructing it. Once your EVP has been finalized you should start thinking about creative ways of communicating it – start by making it available internally and then consider how you’re going to go about communicating it to the outside world via all your formal hiring channels etc.
Does your company have an Employee Value Proposition in place? Do you feel that it has helped your business attract and retain top performers?
“Are there other ways to attract and retain top performers” you ask? Well:
Your Ticket To Success: How To Foster Strong Organizational Culture
In order for a large corporation or company to achieve success, all the gears and cogs need to be pulling their weight – but what happens when communication breaks down?
What happens when the working environment is considered toxic and your employees aren’t happy, and therefore not productive?
Focusing on developing a strong business culture is crucial, as a strong business culture represents an essential tool for keeping the lines of communication open, your employees happy and productive, and your company on the fast-track to success.
How, Then, Do You Go About Fostering Strong Organizational Culture?
Herewith follows the twin tenets of a strong organizational culture:
FOCUS ON COMMUNICATION
In order for communication to work, it needs to be two-way communication and not simply top-down instruction by management or those in power positions.
Fostering strong corporate culture means encouraging feedback from employees and responding to their needs and concerns.
It also means that those in power positions motivate employees by making them feel included and by conveying to them the corporation’s larger and/or long term goals so that each and every employee feels like they’re playing an integral part in achieving that goal.
This ties in directly with the following point:
Employees like to be in the know.
The difference between good communication, and the guise of communication, is transparency.
This is, then, why it is important that all the company’s employees, from the janitor to the CEO, be informed of the company’s vision, mission and goals (as mentioned above).
Transparency fosters trust. If your employees trust that the company is catering to their best interests as well as the bottom line, they’ll be more productive and more inclined to be loyal to the company.
If each employee can ask him- or herself how they can best serve the company’s vision, mission and goals in their work, and they are then inclined, even happy, to do so; the company has succeeded in fostering a strong organizational culture, and will benefit from it.
Also read why Human Resource Planning are important for understanding your employees better.
While good communication and transparency go hand in hand and represent the fundamentals of fostering a strong business culture; maintaining a strong business culture is as an ongoing process.
What tips or tricks for fostering a strong organizational culture have worked for you?
How will your company approach performance management, job grading, employee value propositions, and organizational culture in the future? For more information, or for a little help from the professionals, feel free to contact us at Danshaw Consulting today!