Answer all questions from this section.

Question

By focusing heavily on its talent management program, it can clearly be seen that Netlink is
making the practice of SHRM as one of its key priorities. The way Netlink adopts its appraisal
methodology is of a very strategic angle. By making it a global standard to conduct face-to-face
performance appraisals every 6 months, goes to show that Netlink is reviewing its own
performance management objectives to make sure that those objectives stay relevant and
achievable, and that is a feature of SHRM. Being sensitive to different cultures by employing
different appraisal methods also shows that Netlink understands the importance of managers and
staff identifying and dealing with real, actual problems in a way that is most familiar and effective
to them. That is also another facet of SHRM as through such means, Netlink is able to monitor its
own competitiveness in the market.
Through appraisals, Netlink also classifies their employees into 5 categories ranging from highpotentials,
to critical resources, then to core contributors, followed by underachievers and finally,
underperformers. By doing so they are able to identify areas in which they are lacking and act upon
it. Interestingly, as Simon Mann explains the classifications, it can be seen that Netlink is already
identifying the likely flow of talent in the organization and are taking actions to manage the flow.
For example, when classifying certain employees as underperformers, Mann goes on to mention
that these groups of people do not fit the job requirements and they should be transferred to another
role or be 'managed out'. Clearly, whether the organization decides to place this group of
employees in another role (which fits the idea of SHRM because by placing people where they
perform best clearly benefits any company), or by managing them out (thereby reducing
unnecessary manpower costs or replacement with a more productive candidate), the intent behind
both actions is clearly strategic in nature. The employee classification also allows the organization
to understand their potential and manpower mix which is critical because, the HR department
would be able to plan in advance for staff mobility or develop different programs to help develop
potential of their talents to another level. So far we are able to see that Netlink does indeed view
its employees as a strategic key asset in churning out profits for the organization.
1). Outline five (5) performance categories used by Netlink. (5 marks)
2). By analyzing the above passage, which category is negatively affecting both the business
productivity and the business profits. (2 marks)
3). Mann goes on to mention that these groups of people do not fit the job requirements, and they
should be transferred to another role or be 'managed out'. According to your understanding of the
passage what does the two phrases to another role or be 'managed out' in the statement refers to.
(4 marks)
4. List three (3) types of performance appraisal systems that Netlink can use.
(3 marks)
5). Modern businesses use Performance Management Systems to guide them in compensating and
rewarding their employees. Outline any five (5) problems faced by the organization such as Netlink
when they use pay for performance method to reward the staff. (5 marks)
6). Elaborate on the three (3) key activities that are done at the stage of performance planning.
(6 marks)

Answer 1

1. Five performance categories used by Netlink:

   • High potentials
   • Critical resources
   • Core contributors
   • Underachievers
   • Underperformers

2. Category negatively affecting both business productivity and profits:

   • The "underperformers" category is negatively affecting both business productivity and profits, as these individuals do not fit the job requirements and may hinder overall performance.

3. Meaning of the phrases "to another role" and "be 'managed out'":

   • "To another role" refers to the practice of transferring underperforming employees to different positions within the organization that may better suit their skills and abilities, allowing both the employee and the company to benefit from a better fit.
   • "Be 'managed out'" refers to the process of terminating the employment of underperformers, thereby reducing unnecessary manpower costs and opening up positions for more productive candidates.

4. Three types of performance appraisal systems that Netlink can use:

   • 360-degree feedback
   • Management by objectives (MBO)
   • Behavioral anchored rating scales (BARS)

5. Five problems faced by organizations like Netlink when using pay for performance methods:

   • Possible inequity perceived by employees regarding pay distribution.
   • Potential for fostering unhealthy competition among employees.
   • Difficulty in setting clear, measurable performance goals.
   • Challenges in maintaining employee motivation if performance targets are not met.
   • Risk of short-term focus, potentially sacrificing long-term performance and collaboration.

6. Three key activities at the stage of performance planning:

   • Setting objectives: Establishing clear, measurable, and achievable goals for employees that align with the overall strategic objectives of the organization.
   • Defining performance metrics: Identifying the criteria and key performance indicators that will be used to assess employee performance throughout the evaluation period.
   • Communicating expectations: Ensuring that employees understand the performance goals, metrics, and the expectations of their roles, as well as providing any necessary resources or support to assist them in achieving these objectives.