(Moore, 2010) illustrates that strategic performance management system focuses on the worker’s individual input which is stemmed from a culture inside the company based on interest and worth and it helps the employee to keep attention on base line.
In this assignment there is emphasis given to the importance of ‘Strategic Performance Management,’ its purpose and the main role in the success of an organization. The selected company is Tesco Plc and what it is doing in terms of its performance management. In addition to this the setting or desired goals and their achievement is discussed. The role of teams and the techniques for the setting targets for teams are elaborated. Moreover, it is discussed that how teams help the company achieve its objectives. There is also emphasis on the job of top management to motivate the workforce in order to get the targets are discussed and in the end the ways and means of keeping the employees motivated are presented.
Tesco Plc started its business as a value retailer in 1929 and later on it became a top retail giant doing its business in more than fourteen countries with its core UK operations where it holds more than 35 % market share. The company has achieved this position with its ‘growth strategy’ which focuses on its expansion projects ranging from customers to geographies. It introduced its new strategy in 1997 with a ‘Corporate Steering Wheel which focuses on key expansion areas. The company has an integrated ‘Strategic performance management plan’ in place in order to take it forward in UK as well as abroad (Dransfield, 2001).
Organizations need to set clear strategic goals in order to be successful in the competitive market. These goals should be realistic and clear so that anybody associated with the operations of the organization knows his/her duty regarding these goals (Wyld, 2010).
(Birnbaum, 2009) explains the importance of 10 strategic goals which are needed to be considered by any organization in order to gain success in the marketplace.
(Coisson, 2010) emphasizes the need of a group of employees working together as a team in the organization. The management in all successful companies put ‘team-building activities in place and do the conferences in order to give knowledge to employees of the need of teams. In order to know what the benefit of making ‘teams’ in few steps are important as mentioned below:
The employees should be provided opportunities to get the knowledge of influence of working in a team environment. The company should make the benefits of a team clear to the workforce as a ‘team’ constructs the innovation and changes the quality of the work towards positive results.
The company should emphasize on the need of loyalty towards the team in the mind of workers. There should be proper systems in place in which the employees know their importance and work with eagerness towards the company. They should know that working in a team will enhance their knowledge and skilfulness and make them distinctive in a unit of workers.
Different skills emerge as a result of working in a team and employees should know it. (Likierman, 2009) illustrates the Tesco uses the ‘balanced scorecard’ in order to check the performance of employees linked with the company objectives. The company works on this scorecard in order to make a worker know that if his own goals are accomplished then the company objectives are also achieve while working in a team and in everyday job the workforce does know the effectiveness of working in a team and the balance of company values with his own intentions.
(Phillips, 1994) Litton Company makes navigation systems for ‘cruise missiles’ and ‘fighter gets’ has almost six hundred workers. It had a top-to-bottom conventional structure in 1981 which was later on changed into ‘circles’ known as employee ‘circle partic plan’ in 1981. It consisted of 3 circles, and on the base of progress of these circles of employees working together, they changed to 15 circles in 1982 and in 1983 these circles changed into teams. For the next 1.5 years there was a great progress and continual improvement in the company as a result of these teams working together. There were regular team meeting on the company floor ‘once every week’ in which company executives used to sit with the team members.
Since 1985, all of these team members were provided with 3 days training and in 1987 these teams were changed into ‘self-directed-work-teams’ (SDWT) and as the new boss took interviewed one hundred team members from different teams he find out that there were 1-2 leaders in every team that could lead the company in the future. Since then the number of teams had reached ‘133.’ On the basis of (SWDT), the top management thought to change its product line to two different product lines: 1. “P-500 product line” and 2. “Ring lazor Gyro Product line” and all this was possible due to the team performance. The company then applied total quality management technique (TQM), the waste was reduced, quality was improved, and there was more return on investment (ROI) and many other benefits. Since 1993, the company created 14 focused factories, ROI was more than 600 %, waste was reduced 50% and federal government put the company on the “preferred list” of companies by looking at its progress. This example proves that how important is building teams and what are the benefits to the organization.
There are many tools and techniques used for the performance measurement, but here we will discuss “Mickensy’s 7S” model.
One of the most important tools of measuring the ‘team performance targets is “Mckinsey’s 7S Model’ which was made to measure the performance of a company by a company called Mckinsey and Company (Pascale et al, 1981). All of the ‘variables’ of this model start from the Letter “S.” We will use this technique here to find out the performance of Tesco teams as follows:
These 7S include “Strategy, Structure, systems, skills, style, staff and shared values.” These variable are also known as “managerial molecule.” (Peters & Waterman, 1982). Most of the American companies gave more importance to first three of the variable while neglected others but most of the Japanese considered first two as “soft variables.” Amercians thought that the first three could change. Mickensy’s model does not give importance to the external factors that affect the strategy of the organization. Here we will have a analysis of the variables aligned with the objectives of the company.
So the 7S mentioned in the model are distributed into soft and hard parts. The first three are clearly mentioned in the company reports normally but in order to understand the real situation of the company the soft components are our main focus because the workforce changes these components from time to time. if we want to have a clear knowledge of the company they should be analyzed briefly. Tesco is not like the other organizations where there is more emphasis given to hierarchy than the individual performance. All of its employees know their job and how to do it.
Tesco employees know what is anticipated from them and whether they have achieved the given target or not (Gibbs et al, 2009). The ‘plan and review’ document is given to all of the workers and their performance is mentioned on the ‘steering wheel’ which is posted weekly and monthly in order to show their performance standing. Also all the soft components of Micknsy’s model are interrelated between each other such as values with the workforce and the employee goals and this interralated qualities are coincided in the ‘Corporate Steering Wheel’ of Tesco and when it is displayed at the end of the month, everything is mentioned clearly in this model.
The scorecard of Tesco is practical and it aligns the employee goals to company values and supports the employees align their own values in their daily job. Although most of the company culture and values are related to the ‘core’ of those companies but Tesco employees can pursue their own goals aligned with the company goals (Likierman, 2009).
(Chuasiriporn, 2010) thinks that ‘performance measurement’ can made official with the help of diagrams and charts in order to keep an eye on the growth to fulfil the goals of the organization. The only method to do it is to keep measuring it in the form of numbers. When the data is put in the shape of a graph, then it can be a lead for the prospects the company wants to achieve.
There should be a estimation of current performance of the organization in full and all of the components to be measured should be clearly mentioned.
Clear ‘dates’ should be fixed in order to achieve some objectives, there might be a difference of opinion in the mind of workers and their managers but still a fixed time frame should be mentioned.
There should be clarity of which goals to be achieved first and which ones have a secondary importance. Those objectives which are needed to be taken care of first, should be prioritised.
All of the targets should be flexible and changeable in performance measurement. There should be a clear vision about the target and if any change is needed should be done. That means there should be proper ‘tracking’ of all the measures.
(Tesco Case Study) gives an idea of the ‘balanced scorecard’ used at Tesco in order to measure the performance of the employees and core reimbursements are given below:
There should be an agreement in the teams about the specific targets to be achieved in a specific period of time, keeping in view what is most important to do first. (Hanson, 2010) thinks that in order to have influential management, the ‘performance measurement’ is important. He considers various steps to be consideredL Tesco has plan to introduce hypermarket shoping mall which is running successful in China. While international level tesco open superstore in india with tata group which is a success of tesco in Asia. Whil in Europe tesco has plan to open more store food and non food.
(Nash, 2009) explains that organizations should always give more importance to each of the individuals who are working in a team; workers should be given more confidence and must be engaged in all the works done by the team.( There are many factors important in this regard including taking care of the individual preferences, their choices, the values of the individual, giving them importance and rewarding them if any target is achieved. These factors can be helpful in useful contribution of the individual. When this individual with the encouragement will join a team he/she will contribute and the team will be high performing one.
Any kind of mentoring and coaching influences the performance of the individual with new skills, behaviour and new commitment with the job. If the team member is not coached about whole of the environment and how to do the job, that member is not confident and if not confident will not contribute positively to the team. (Johnson, 2009 believes that there should be five steps given importance in this regard 1. Setting clear goals 2. Training 3. Behaviour observation 4. Feedback and 5. Positive reinforcement.
(Holman, 2009) describes the importance of ‘team performance plan’ as this plan is not just managed in 1 department of the company; it is in the whole organization. This team performance plan has brings many benefits to the organization as the team performance Solves many problems and is helpful in different choices. Because there is not just one person taking all the decisions, it is the whole team which does it, so they become easy.
Teams working at Tesco consist of all kinds of workers and they keep sharing their work and duties. There is great importance given to company growth strategy but the whole of the workforce which consists of teams knows what they have to do, what is the company goal and what is their own target and the route to achieve it. There is a great collaboration in teams and they work together to achieve the company objectives and they are informed every week that what is the company target and what is their progress with the help of ‘Tesco Steering Wheel.’
It is the responsibility of any leader to monitor the performance of any team. There can be many ways to monitor the performance (Papa, 2010). One of them can be that there should be clear objectives in mind of the leader and if the team reaches those targets then it is clear that performance is good otherwise not. Another way is taking the feedback from the team, either with the internal resources or external ones. If there is positive response from the team members, it means there are good expectations from the team and vice versa.
(Diligent, 2009) thinks that it is not easy to be a leader in a team and evaluate a team performance. Being in a team and leading it is one of the most difficult works to do. If there is low morale in the team it does not always mean that team is performing well but leadership is weak. Team member work in negative fashion if they think they are not treated properly by the leader. In order to get out of situation like this, a top leader has to evaluate the team performance if anything has gone wrong. Tesco leaders are not rigid but there is a democratic culture within the organization and there has not been many cases of team members going to court in order to tell that they are mistreated.
According to (Batumalai 2008) it is important for the leaders to ‘persuade’ the team members in order to get them involved in the decision making and improve the team-work. There are many ways of doing it as mentioned below:
At Tesco team leaders are those workers who already have been in teams and know how to persuade people to work in a healthy environment. The techniques used in Litton are most effective ones in this regard where the top executives of the company used to sit on the same floor as the lower level employees.
(Fagnani, 2006) describes that in order to give importance to the performance of an individual in a team and makes the things easy for the team-work, the knowledge of different ‘personality types’ is important and ‘Myers-Briggs Type Indicator (MBTI)’ is one way of doing it. The model has described four personality types: ‘extroverts/introverts, sensing/intuition, thinking/feeling and judging/perceiving.’ On the base of these results there are sixteen personality types discovered.
There are many methods used in MBTI to determine the personality of the team member and what role he/she can play in the team. One way of doing it is ‘Indoor roping’ by using this technique, there are six ropes used, as they are put on the floor, as a personality test the team members are asked to stand in one of the ropes. At the end the completely different types of personalities will be in opposite sides of the ropes. Similarly another method used is ‘role playing’ in which members of the team are asked to fire other individual from the job. Some of them show sympathy towards that individual while other do it straight away, so a emotional situation arises. Lastly, ‘fun exercises’ are one way of doing it in which different individuals are given a specific task to do and one of the member helps them, this shows how two members of the same team can work together.
(Thomas, 2008) describes the team building exercises and role playing at Tesco Hertfordshire in a case study and demonstrates the importance of fun games played in order to build teams and shows the enjoyment.
(Thomas, 2010) describes the importance of giving training and producing leaders in the organizations around the world. In the difficult time of today there are so many companies cutting down on training but there is great need of doing it as seventy percent of companies are putting more money in training and team building.
In the assignment we discussed different issues ranging from importance of strategic performance measurement to the making of leaders. So it looks like the direction of the assignment was that how a company can make great leaders and get prosperous in the future. Any workers who joins the company is not a leader but just a worker who knows nothing how to become an influential part of the management. It is the performance measurement who guides the worker to become a good leader. The company we chose for the assignment also looks an ideal company in this regard.