Introduction
A Performance Management system must be oriented by and aligned with the business strategy, in such a way that it can associate the level of individual contribution to the objectives of the organization. In this way, an effective performance management system must add value to business processes based on the contribution of people and provide guidelines for the development of Human Capital.
Human Resources Policies
Within the strategic objectives of the company, is to guide the actions of human resources towards a high performance organizational culture, administered through the Human Resources Management, through the development of people, for which there is real conviction that it is possible to integrate and make compatible both the interest of the organization and that of the people. The central axis of this vision is the development of people's competences, since it is these that allow their employability, job growth and personal development, thus strengthening the competitiveness and viability of the organization in the long term.
The strategic guidelines of the Human Resources Management define Performance Management as a key axis in the administration of human capital, which provides valid and reliable information to guide the development of people, recognize high performance and identify potentials that satisfy the current and future needs of the company.
goals
- Define the objectives and goals of each management and unit, aligned with the strategic objectives of the company and their relative importance in achieving them. Have an objective system that allows evaluating the contribution that each person makes to achieve the objectives of their unit, its management and the organization. Motivate and recognize the successful performance of collaborators through a clear policy of incentives, product of an evaluation with an excellent rating. This system allows to guide, follow, review, evaluate and improve the Management of People in order to achieve the objectives, goals and results of both the people and the organization.
Stages of Strategic Performance Evaluation
Stages of Strategic Performance Evaluation
- Strategic Planning: It is the annual planning process carried out by the organization, which defines the guidelines, objectives and goals for the period, which are reflected in the different areas of the Balance Score Card and in the budget, approved by the board of directors. BSC Planning by Management: The objectives, goals, projects and relative weighting of each indicator are defined in corporate planning, according to the contribution they make to the strategic objectives, of each of the management BSC planning per unit: For each area of each management, the objectives, goals, projects and their relative importance are defined for the achievement of the management's objectives, these must be aligned with each other. Individual BSC planning:The objectives and goals of each person are established according to the objectives of the unit and their contribution to achieving them, there must be consensus in the defined commitment. Support and Follow-up: It is a process by which it is systematically and regularly collected the data referring to the development of the objectives over time. The achievement of the objectives is partially reviewed, identifying, prior to the final evaluation, possible obstacles, establishing the necessary action plans to overcome them. It is, therefore, a permanent feedback stage between the management and the collaborator whose purpose is to facilitate the final fulfillment of the established goals. Evaluation of Compliance with Annual Objectives:It is the quantitative evaluation of the fulfillment of the objectives in correspondence to the management commitments agreed with the head. Competency Evaluation: It is part of the Strategic Performance Management system, which assesses the level of competencies that the collaborator requires for the efficient performance of the charge. Strategic Performance Evaluation: It is the systematic, cyclical, formal and participatory process of the quantitative and qualitative evaluation of the degree of fulfillment of the objectives and competences of each collaborator in accordance with what is planned.It is the systematic, cyclical, formal and participatory process of the quantitative and qualitative assessment of the degree of fulfillment of the objectives and competences of each collaborator in accordance with what is planned.It is the systematic, cyclical, formal and participatory process of the quantitative and qualitative assessment of the degree of fulfillment of the objectives and competences of each collaborator in accordance with what is planned.
Standards for Strategic Performance Evaluation
- All the managers are responsible for the continuous management of the performance of their collaborators, both in the orientation towards the fulfillment of goals and objectives, and in the development of competencies. The Strategic evaluation of performance must be carried out at all levels and to all staff. Evaluation of the fulfillment of Annual Objectives is carried out based on an individual work plan, which is derived from the management's strategic plan, which is agreed between the boss and the collaborator. Performance standards must be developed based on the job description and The objectives of the individual plans, which cannot be more than five objectives for each position. The Competency Assessment is defined by the level of competencies required for each position in the organization.which considers maximum the five most relevant competencies and that explain the high performance of a position. The principles that govern these evaluation processes are objectivity, participation, responsibility and individual and company commitment. The Strategic Performance Evaluation is based on The evaluation of two fundamental parameters, the individual quantitative objectives and the competences, whose final evaluation constitutes the annual performance management rating. The BSC Annual Objectives Compliance Assessment has a weighting of 70% of the final rating. Assessment of Competences, evaluated according to the degree of total adequacy of the required levels, has a weighting of 30% of the final grade.Recognition of good performance will be made to people who achieve the efficiency level of excellent and very good. Establishing itself through the following modalities.
- Economic improvement, according to the adaptation to your salary range. It will be a qualification indicator when participating in an internal competition, for a vertical promotion or horizontal movement. Grant support actions for study. Consideration in succession plans of the area or management, of the company
Planning Dates: The planning and commitment agreements of each management must be ratified during the month of January, those of area heads and collaborators of the different units must be agreed in the first two months.
Process
Objective Planning Stage
A. At the end of each calendar year, the general management together with the area managers propose to the organization's board the Strategic Plan for the following year, which must be approved by it.
B. The Corporate BSC and the different plans for each management arise from this Plan, which must be agreed in the month of January, through a BSC per management, defining the percentage of importance for each indicator.
C. Each manager must agree with each head of area the plan of each one of them through a BSC that supports the achievement of the objectives of management and consequently the organization, defining the relative importance of each indicator, these must be agreed within the first two months of each year.
D. Next, each manager must agree on the objectives of each of his collaborators and must be ratified within the first two months, indicating the indicators and percentages of importance.
E. Each of these commitments must be reflected in a written document signed by both parties, each one being left with a copy. If, subsequently, there is a technological system, these must be entered into this system.
Follow-up and Feedback Stage
F. Monthly, meetings must be held between the Manager and the area heads, to review the status of the managerial BSC.
G. Quarterly, a feedback activity must be carried out that is essential for the performance management system, since the active participation of both the collaborator and the boss contributes to learning, fosters the capacity for self-criticism and incorporates this practice into the culture. organizational.
H. This review allows for adjustments to be made to unforeseen changes in actions to achieve the objectives.
I. At these meetings, people are supported to continue improving.
Results Evaluation Stage
J. The performance evaluation process is carried out between the months of November and December.
K. Each collaborator performs their own self-evaluation of the results of their BSC. The boss, for his part, prepares the evaluation of each of his collaborators, according to the compliance indicators.
L. Subsequently, a meeting is held between the two to assess compliance with the objectives and goals achieved by the BSC.
Competency Assessment
This process is part of the Strategic Performance Evaluation and is carried out in parallel throughout the year.
- It has been defined that in the months of August and September the evaluation process of the heads of area is carried out, in the 360º modality, with the participation of the direct chief, peers, collaborators and self-evaluation. The collaborators are evaluated 180º between March and April, that is, self-evaluation and evaluation of the direct manager. If there were to be a technological system that supports this process, these evaluation periods could change and all be carried out in parallel. Once the results of the evaluations were obtained, the Human Resources Management, delivers the report of each boss and that of the collaborator to the direct boss, to carry out the skills feedback interview. Along with the quarterly meeting to follow up on the BSC objectives,Feedback must be given on agreements and commitments for the development or reduction of skills gaps, which must be recorded in a document that facilitates monitoring.
Information processing and obtaining results
The results of the BSC Objective Compliance Assessment, duly signed by both parties, should be sent to the Organizational Development area, dependent on the HR management.
The degree of adjustment of the required level of each competence is the indicator considered for the calculation of the Strategic Performance Evaluation, whose data is processed by said area.
Weighting of Results
The evaluation of the fulfillment of objectives will have a weighting of 70%, whose composition will be given by the following results and weights:
Weighting of Results
The weighting of the Evaluation of Competences will be 30% in the overall grade of each person.
The efficiency levels that will serve as parameters are the following:
Weighting of Results
Definition and recognition of results
The company's income is defined by market remuneration studies and each position is evaluated by the HAY method, which defines a salary band for each of them.
The rents have two tables of comparison with the market:
- Guaranteed fixed income Total target income, which includes variable income and yield bonds
By compensation policy, it has been defined that the following charges obtain Annual Yield Bonuses:
Weighting of Results
This is a proposal that can vary according to the organization and that must be defined in the management committee or board.
According to the BSC compliance percentage of each manager and head of area, the performance bonus will be canceled as follows:
Weighting of Results
Under 80% compliance, it will be the Managers' Committee or the Board of Directors who will define whether a certain percentage of the Performance Bonus is granted.
These bonuses must be canceled in the January compensation payment.
Merit Income Adjustments
- For those positions that do not have variable income, it must be compared with the Guaranteed Fixed Income Remuneration Scale. For positions that have monthly variable income, the Total Total Income Target Remuneration Scale must be considered.
Based on the annual budget assigned for income improvement, the annual income adjustment will be made considering the Strategic Performance Management Index and the adaptation of income to the Salary Band, according to the following table:
Weighting of Results
People who obtain excellent or very good performance and their income is above 120% of the median of their position, their management should be recognized through a change of position, promotion, study scholarships or other action provided by the Human Resources Committee.
The income adjustments derived from this process should be reflected in the March salary process.
Responsibilities
The Human Resources Management through its specialized unit: Has the responsibility of advising the participants on the correct application of the system, planning and coordinating the complete process and systematizing the information obtained within the different stages. This implies responsibility for:
Plan and coordinate the implementation of the different stages of both the Objective Compliance Assessment and the Competency Assessment
Communicate the start and end date of both evaluation processes.
Provide advice regarding the application of the process in general.
Provide training to evaluators and those evaluated in the correct application of the system and the instruments that comprise it.
Centralize the distribution, collection, analysis and monitoring of the information derived from the Strategic Performance Evaluation System, safeguarding the seriousness and confidentiality that the process requires.
Update and suggest modifications to evaluation procedures and instruments.
Develop an internal communications plan to promote the Strategic Performance Management model.
Management Control Area: It will have the responsibility of supporting HR in the review of the consistency between the BSC of the area Management with respect to the BSC of the direct headquarters, prior to the signing of commitments between manager and boss, of way to ensure target alignment.
Personnel area dependent on the HR Management: It will be responsible for issuing during the month of April, the contractual documents generated by the application of this System and obtaining their signature, coinciding with the legal update of the annexes of contracts.
