A Critical Evaluation of Employee Performance Management System (pms) at State Trading Organization Plc.

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STO vision is “Enriching lives through expansion and accessibility.” Caring, accessible, respectful, innovation and progressive are main five values which are the key to uphold their vision. One of their mission statement is “Build a skilled workforce by investing in human development; build our competencies, to achieve sustainable and unhindered growth and fulfill our vision”. To fulfill and uphold their vision it says skilled workforce plays a vital role in strengthening and expending STO businesses activities. Performance management system is one the key area which helps to unfold the weakness of employees and a pathway to improve the performance of the employees at work.

1.2 Research problem

Every company has its own unique performance management system which fit the relevant criteria in accordance with the time and it has evolved with the current working style. For past 30 years, STO has practiced same performance evaluation method, which is a single performance appraisal form (see appendix) applied to all employees to appraise their performance. These printed three-page forms are generated manually from excel. Current employee performance appraisal form cover mainly three parts, which are;

- Employee’s information & comment.

- Evaluation criteria and employee’s attendance record of past one year.

- Disciplinary actions record of past one year.

STO management revealed that there is a problem with the current performance management system. STO Performance management system has mainly two purposes one is for promotional and second is for disciplinary action (Shukoor, personal communication, October,10,2017). Staffs have raised concern regarding unfair promotions by comparing their respective co-workers and because of that some of them leave the organization. From the conversation with Shukoor it is revealed that even though STO management understand there is a problem in performance management, they are unsure of the cause of this problem. They are not familiar with PMS and yet they are not sure of this system’s effectiveness.

CHAPTER TWO

2.0 Focus of the study

This chapter of the research discusses key areas of focus and what I intended to determine from this research study. Sections in this part include the purpose of research, research questions, and significance of the study.

2.1 Purpose of the research

This study carried out to evaluate the current performance appraisal system of State Trading Organization Plc and to recommend changes to existing performance management system to help bring improvement. The performance management system at STO directly affects the motivation of employee as it defines and determines the promotion and career development and company annual bonus.

Key areas this research investigated are:

- Current performance appraisal management system at STO.

- How it is conducted (how frequent it is conducted and who are the participants involved in the appraisal).

- Determined what decisions are to make in regards to employee’s performance (to see its effectiveness).

Finding and results from the investigation of current PMS at STO will be presented in findings and discussion section of this report.

2.2 Research question

Following research questions are answered in this report:

RQ1. What is the current performance management system in use at STO?

RQ2. How effective is the current performance management system at STO?

RQ3. What are the strengths and weaknesses of current performance management system at STO?

RQ4. What are the things that can be done to improve performance management system?

2.3 Significance of the research

This research was conducted to determine the effectiveness of current performance management system at STO. Findings from this research could be helpful to the management of STO to make strategize their human resources related decision, importantly to overcome the boundaries and limitation on achieving expected results in terms of employee performance. Without proper performance management system, it will be a challenge to motivate and retain the employees in the organization. Furthermore, this findings and results of this research study will be useful for management of STO to understand the importance of a proper PMS to properly maintain the performance of employees.

CHAPTER THREE

3.0 Literature review

Regardless the type of organization, it is important to have an effective Performance management system to evaluate and measure employee performance. This is because the success of the organization depends on the level of employee motivation and performance. According to Toppo and Prusty (2012), performance appraisal is the strategic evaluation of the individual to see how well or bad they perform at work. This also determines employee’s potential for professional development. Performance management system (PMS) is used in nearly in all type of organizations. This is to measure and evaluate individual employee’s behavior and accomplishment over a specific period of time.

In the competitive business world important to maintain the performance of employees are becoming an important role in effective human resources management and effective leadership management. It is leaders and management’s responsibility to make sure their employees are motivated to carry out job tasks because motivated employees tend to perform better in the organization (Qureshi, Shahjehan, Zia-ur-Rehman, & Afsar, 2010).

Purpose of performance management system (PMS) defined by Herman Aguinis (2013) that performance management system is a continuous process of identifying and measuring employee’s performance in regards to organization’s mission, vision, goals, and objectives and to see individual employee’s contribution toward achieving those goals, mission, vision, and objectives. Performance management system is critical to organization despite the size of the organization. Performance management