MANAGEMENT

Employee Performance and Strategic Planning

Employee Performance and Strategic Planning

Introduction

The company chose for this assignment is Tesco Company. It is a UK based supermarket found by Jack Cohen in 1919. This company uses a mixture of different performance management tools.

Be able to set performance targets of teams to meet strategic objectives

Assess the relationship between performance management and strategic planning

Tesco uses a mix of different performance management tools. Score card methodology used by Tesco is modified and has aptly named it as 'Steering Wheel'. Tesco's steering wheel is an extension of Kaplan and Norton (1996), such that it has been extended and the element of community lies at the heart of it. It has four dimensions or segments and each segment has its own set of objectives. Where green stands for targets achieved, amber stands for the target that needs attention and red colour denotes the outright failure of the targets. For example, the target for waste in the store is set at 5% of revenue. If it is below 4% then on Steering Wheel, the target would be colour coded as green if it is over 5% then red and so on. It claims that the purpose is not visionary. The basic purpose of the particular approach is to connect each employee's personal objectives to corporate values and to help staff manage these values effectively and efficiently in the daily management of work (Hill & Jones, 2010, pp. 241).

Wheel encapsulates all the performance targets which Tesco needs in order to achieve its objectives. If the team performance on the steering wheel is green, then the strategic objectives would be attained whereas if it is red then it will not. The greener the steering wheel the close that Store is to achieve its objectives. The same principle is used at a strategic level. On the store level, Tesco uses the classical hierarchical management. Depending on the size of the store, it is divided into six sections usually they are, front end (check outs), produce and fresh, merchandising, stock control, administration, personnel and ambient. All sections have operational staffs that are supervised by a team leader. This team leader reports back to sectional manager and sectional manager in return report to store managers, who are answerable to area managers. Operational level staff does not require any skill but training starts from there onwards (Gardner et al, 1986, pp. 99).

Methods and tools available to design performance management systems in the organisation

The operational performances of Tesco stores on the wheel's objectives are reported and reviewed quarterly at board level and afterwards a summary report is sent to the top 2000 managers to cascade to staff in the stores. The driving force is the customer or people based in the heart and use a performance based approach. It concentrates on objectives which are diagnostic in nature. It allows a daily performance measurement which could also be used for the long term strategic purposes. Daily, weekly and monthly targets are reviewed ...