ACKNOWLEDGEMENT

I am using this opportunity to express my gratitude to everyone who supported me

throughout the course of this IPM case study
I express my warm thanks to my lecture Mr. Ajith R De Costa and IPM Management
staff for their support and guidance.
Thank you,

Executive Summary
SPL is a FMCG company and has been in the industry for 10 year. The company
current turnover is RS.75 million and last three year sales and profits are drop down.
Mr. Ravi Gomez is a CEO of the company and he go through the performance
management system workshop and impressed with the advantages of performance
management system. After couple of week Mr. Ravi Gomez recruited HR manager
Mr. Prasanna Perera and advice to HR manager prepare the performance management
system for the SPL (Pvt) Ltd and Mr.Ravi give for six issues of company performance
management system and said to find the alternative solution for the issues.

1. Analyze and identify issues involved in the case.

SPL is the one of the largest FMCG Company in the market in the last ten years, but
considering about the last three years, their performance has gone down. Analyzing
the following details easily we can identify their fall down.
Year
2007
2008
2009

Sales (M)
80
75
70

Profit (M)
20
17
12

Compeering the above figures in 2007 to 2008 their sales has been dropped down to
80 Million to 75 Million. It is 5 Million sales dropped, in the same years their profit
was dropped down by 3 Million. Compeering the 2008 to 2009 their sales was
dropped down by 75 Million to 70 million as well as the profit was dropped down by
5 Million. This is a very serious situation for any company. Thing is within the last
three years their total sales go down by 10 Million and Profit is 8 Million. This is a
very critical situation of the company; because of this issue the company may be not
able to do the more investment, the people how are working at the company have risk
of their job security. They will lose their trust of the company as well as the market
shear of the company loses. Employees are lost their benefits; because of this problem
the employees performance automatically go down.
To survive in the market, any company must generate the more sales and more profit.
As a company they were in decline in the business, reason for this issue is
performance of the employees has gone down. If the employees are not done their
duties efficiently and effectively any organization will face this kind of the issues.
Each an every company their success based on their employees performances. (Top
management, Executive and Non-Executive). Generating the sales, profit link with the
employees performance. These on factors are go down it will effect to the whole
process of the company.
The CEO of the company Mr. Ravi Gomez has been identifying the current serious
situation of the company and he needs to overcome the current situation of the
company as a result he made the decision to recruited well qualified, experience HR
Manger to company.
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To overcome the current circumstances he has been advice to HR manger to do a

performance management system to SPL (PVT) Ltd regarding the following issues

Increase sales to 100 Million

Reduce employee turnover to single digit, currently 12%
Modernize the existing package plant
Selling of all inefficient assets (such as old machinery & Vehicles) and raise

RS. One million

Increase market share of Chocolates to 20% (currently 10%)
Increase the production of soap from 25,000 units to 35,000 units

To achieve the about the targets of the company as the HR manager has to increase
the performance of employees in each and every division.

2. Introduce and Implement of the PMS System to the SPL (Pvt) Ltd

Used well, employee performance appraisal is the most powerful instrument that
organizations have to mobilize the energy of every employee in the enterprise toward
the achievement of strategic goals. Employee performance appraisal can focus each
person's attention on the company's mission, vision and values. And ideally, the
process can answer the two fundamental questions that every single person in the
organization wants the answers to: What do you expect of me? And how am I doing?
There is an ideal method for the assessment process. In organizations that take
employee performance appraisal seriously and use the process well, the system
functions are as follows.
1. Employee Performance Planning
2. Employee Performance Implementation.
3. Employee Performance Assessment
4. Employee Performance Review
Employee Performance Planning
At the beginning of the year, the manager meets with each person for discussion on
the planning piece of the employee performance appraisal process. In this hour-long
session they discuss the "how" and the "what" of the job:
How the person will do the job, what results the person will achieve over the next
twelve months the key responsibilities of the person's job and the goals and projects
the person will work on.
They also discuss the individual's development plans. This discussion immediately
generates improved employee performance because people know exactly what's
expected of them. And as the manager, you have just earned the right to hold people
accountable at the end of the year by making your expectations of them clear from the
start.

Employee Performance implementation

Over the course of the year, employee performance should be focused on achieving
the goals, objectives and key responsibilities of the job. The manager provides
coaching and feedback to the individual to increase the probability of success and
creates the conditions that motivate and resolve any performance problems that arise.
Midway through the year perhaps even more frequently they meet to review the
individual's progress toward the plans and goals discussed in the employee
performance planning meeting. And the employee is responsible for certain elements
of that progress - seeking out coaching and asking for feedback are two key examples.
Employee Performance Assessment
As the time for the formal employee performance appraisal approaches, the manager
reflects on how well the subordinate has performed over the course of the year,
assembles the various forms and paperwork that the organization provides to make
this assessment, and fills them out. The manager may also recommend a change in the
individual's compensation based on the quality of the individual's work.
Best practice calls for the appraiser's boss to review the completed assessment form
before discussing it with the assessed employee. An employee performance appraisal
is a record of a manager's opinion of an employee's quality of work, so don't avoid
from candidly providing that opinion.
Employee Performance Review
The manager and the subordinate meet, usually for about an hour. The employee
performance appraisal form is reviewed with the self-appraisal that the individual
created assessing her own performance. The manager and employee talk honestly
about how well she performed over the past twelve months: Strengths, weaknesses,
successes and areas needing improvement. At the end of the review meeting they set a
date to meet again to hold an employee performance planning discussion for the
upcoming twelve months, starting the process anew.

This four-phase performance appraisal process not only transforms employee

performance management from an annual event to an on-going cycle, it tightly links
the performance of each organization member with the mission and values of the
company as a whole. And that's the real purpose of employee performance appraisal
in the organization. The real value is focusing everyone's attention on what is
genuinely important -- the achievement of the organization's strategic goals through
demonstration of the company's vision and values in each employee's day-to-day
behavior.

3. Your report should involve the step by step process of a PMS system
which would include designing of Goal & Objective setting for each
department and year end review
To achieve the issue mention by the Mr. Ravi, each and every department has to
design their goal and Objective. For this each and every department have to do the
Employee performance planning.
To increase the sales to 100 million and increase the market share of chocolate to 20%
the firstly they have to make the Employee performance plan with the Sales
department, Marketing Department and production department, because company
sales mainly depend on these department. In here HR manager have do the individual
discussion with each and every person and let they know what is person will do the
job and what result the person will achieve the next 12 months. In here to achieve the
100 million sales and increase the market share of chocolate to 20% each and every
person in the sales department have to give their own target and have to get what is
the plan for achieve the target, in here dividing the sales target monthly or quarterly
have to give them, in the mean time the HR Manager have to the performance
analysis by monthly quarterly and let them know how much they behind their goal, to
give the support to the sales team who the marketing team handle their marketing
activities and to achieve the 100 million sales the production team have to give a
100% production the sales team.
To reduce the employee turnover to the single digits the HR department has to help to
the each and every person to identify their job roles and their responsibility, so most
of employees are resigning from the company due to lack of knowledge of the job
role. Getting a year plan form the employees the will know what is his duties, so it
will help full to them to do their work properly.
To increase the production of soap form 25000 units to 35000 units they have to carry
out the Employee performance planning for production division and finance division.
In here production division employee has prepare the production forecast and makes
the plan how to achieve it. It will be help full to the every employee to increase their
efficiency and effectiveness. Individually they know the plan and they know how to
perform.
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In the Employee Performance implementation step over the course of the year
employee performance should be focused on achieving the goals, objectives and key
responsibilities of the job. In here all manager of the department have to play a huge
role. To increase the sales to 100 million and increase the market share of chocolate to
20% have to coach the sales tem individually. To achieve their individual target what
kind of strategies they have to use, it mean offering the special prices, special discount
method, buy one get one free like promotion methods and giving the product
knowledge to the sales people. Likewise have to caroche them. Caroche is not enough
as a manager have done the review of the employees individually and let them to
know what is their position on the sales, who much he has behind his plan and have to
discuss with them individually, what is the plan to achieve the remaining amount.
In here the managers has to put the condition to the sales team, if they are achieved
100% target monthly only they are liable to the 1% commission for their target and
other benefit( Fuel Expenses, Bata, Overseas tours)
In here coaching the employee of the company they will get the opportunity get the
more knowledge of his job role and they will specialize for the work. Achieving their
individual plan and giving the commission or other benefit will help full to motivate
the employees. So as a result they will not resign the company.
Increase the production of soap from 25,000 units to 35,000 units, over the course of
the year, employee performance should be focused on achieving the goals, objectives
and key responsibilities of the job. In here production manager have to coach the
employee individually and give them to feedback how much he has been achieved on
his forecast. If there are not performing to the forecast the managers has to make
discussion with them and have to get the reason for it and have to give the answer for
the issues. Putting the condition can influence them to achieve the production target.
Give the extra over time payment or commission.
Doing the employee performance assessment the managers can get the reflects on
how well the subordinate has performed over the course of the year. For this the

manager has to maintain the various forms and paper works to keep the recode of the
employees.
The manager can keep the different kind of sales report and financial report to analyst
the sales team has been achieved their target or not. He can maintain the sales report
individually for whole year. He can keep their target their achievement and their
achievement presenting of that report. Using this report he can get idea about the how
the sales people are contribute to increase the sales individually. Using the financial
report the managers can get how much market share we achieved for the chocolates.
Through this reports the managers can get how much they have been invest in the
market and what is their profit. Using this report the managers can get the aide about
whether there are achieve the 100 million of the year and 20% market share for the
chocolate and individually how they contribute to it. Using the financial document the
managers can get how much they have earned the selling old machinery and vehicles.
As well as the keeping the employee turnover records the managers can get the how
many people are resign the company. Using the commission, overtime, and other
benefit offering reports can get the idea about how much they have been earn over the
yare and are they satisfy with their earning.
Using the production report, production growth analysis, material purchasing report,
production cover report monthly weekly and yearly can get the idea about whether
production has been growth or not, in here can keep the record production section by
and section individual by. Using this reports the managers can get the whether
production people achieved their target or not.
Best practice calls for the appraiser's boss to review the completed assessment form
before discussing it with the assessed employee. An employee performance appraisal
is a record of a manager's opinion of an employee's quality of work, so don't avoid
from candidly providing that opinion.

The final step is employee performance review, it mean the manager and the
subordinate meet, usually for about an hour. The employee performance appraisal

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form is reviewed with the self-appraisal that the individual created assessing her own
performance.
Using the above mention sales reports and appraisal form has to discuss with the each
and employees of the sales team. Taking their personal sales figures and have to
discuss how much they have been contribute to the sales to achieve the 100 million
sales and to increase chocolate market shear to 20%, Increase the production of soap
from 25,000 units to 35,000 units of the company over the year. If the employee is not
achieve is plan have to discuss about his week areas and which area he need to
improve and to do the more sales what are the things he need. (More training,
Discount, Special prices, quality product). If the sales employee achieve the his target
the manager has to discus with him what is his strength and what the things he need to
improve the sales more to the company. At the end of the review meeting they set a
date to meet again to hold an employee performance planning discussion for the
upcoming twelve months, starting the process anew.

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