Case Analysis And Evaluation Of The Replacement System Evaluation

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Replacement System Evaluation After two years and record revenues, Williams decided that it was time for the replacement system to be evaluated. The PMET2, led by Hoffman, was tasked with viewing the system along with other company leaders and HR generalists. They collected data by comparing the distributions between the legacy system in the replacement system, serving employees on the perceptions regarding the legacy and replacement system, and conducted focus groups with employees and managers. Based on several issues, notably that it was difficult to discuss performance with employees due to the timing of merit increases and that these compensation increases made employees apprehensive to the performance management system as well as to …show more content…
The main issues identified was a rating system with too many types of ratings, managers having a fear of giving feedback to employees and distinguishing amongst their employees, a lack of reinforcement for top performers that upset team dynamics within R&D, and an undervaluing of top performers with unfair merit increases due to the comparative ratio of individual performance that determine compensation increases. The new system to replace the legacy system simplified the ratings, required a force distribution, and revamped the compensation system with the use of incentivized short and long-term cash and equity bonuses. As you can see, the rating system does not address all issues and does not center around the crux of the desired output from R&D: …show more content…
While the new system could still have an emphasis on individuals and their performance, an added emphasis on team performance could lead teams to develop more innovative products and have a focused mission to accomplish in which they could be evaluated. Additionally, the legacy performance management system’s compensation system was designed to keep top talent by offering competitive salaries yet did not motivate employees to be top performers due to unfair merit increases amongst others in the organization. While the new system attempted to address this issue by offering performance related short- and long-term equity bonuses, abuses by management in giving inaccurate ratings such as rotating employees into the top categories or not rating high-performing newer employees negated this solution. This fear of giving feedback was identified in the legacy system but not fully addressed in the replacement system. Managers were still afraid to give accurate performance appraisals to employees and despite having an accountability system that attempted to reward successful implementation of the performance management system by managers with stock options, managers still avoided using the system correctly, thus still not properly motivating high performance from employees. One way to address this

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