Key Aspects of Effective Performance Management of Expatriates in HSBC
This paper discusses the key aspects of effective performance management for expatriates. In details, it tackles the planning, monitoring, developing, rating, and rewarding of performance. These processes are considered to be the key aspects of effective performance management as they construct a system that contributes to the current status of line managers and strategic planners and positively affect the achievement of company’s goals. Planning refers to the process of setting objectives in line to the overall organizational objectives based on individual or group level. Monitoring is the constant measurement of performance and ensuring current feedback on the progression of achieving established goals. Developing is the aspect where there is a need to evaluate and address developmental needs of individuals or groups involved in the achievement of goal. Rating is the evaluation of performance based on given elements and standards. Rewarding is the aspect where the individuals or groups are recognized for successfully achieving set goals. In international setting, expatriates are expected to understand the following aspects so as to ensure the maximization of both individual and organizational resources, purpose, and performance. These aspects are reflected on the case of HSBC. HSBC, being an international bank, needs to send managers to different branches all over the world to do specific set of responsibilities. The identified aspects are used and integrated in their HR strategy as well as overall organizational operations with the aims of maintaining competitiveness and industry leadership. It is concluded the HSBC is outstanding in effectively applying international HRM strategy particularly in performance management of expatriates. The results are seen on the achievement of set goals and the continuous development of potential business opportunities for HSBC. Recommendations obtained in the case ranges on the need for HSBC to anticipate emerging HR trends for expatriates as well as the means on how to manage the economic requirements amidst the ongoing global financial challenge.
International Performance Management
It is unanimously accepted in management theory and by management authors that performance management is the integrated, strategic, and systematic approach that focuses on appraising and developing the competencies of human resources in the achievement of organizational goals and success. The most important features of every definition are: integrated, strategic, and systematic approach, appraisal and development of competencies, and achievement of organizational goals and success. In the international perspective, performance management is refers to the same approach applied to expatriates or for people who are working in foreign country. In simpler terms, Beardwell and Holden (2001, p. 540) aver that performance management is the connection between “what’s” (objectives, targets and performance standards) and “how’s” (behaviors, competencies and processes) of employees’ performance. It is basically related on the development of employees based on behaviors, competencies and processes towards the achievement of organizational objectives, targets and performance standards. Anderson and colleagues (2006) affirm that “integrated approach to performance management is much more powerful than the traditional approach of isolated changes and improvements that often end up countering each other” (p. 77). With all the definitions of performance management, the international application uses the same principles with special consideration of the condition of a foreign setting.
Key Aspects of Effective Performance Management: how to achieve them
Performance management is not limited to the evaluation of individual or group performance. Armstrong and Baron (1998 as cited in Bilgin 2007) say that “it is an integrated and continuous process that develops, communicates and enables the future direction, core competencies and values of the organization, and helps to create a horizon of understanding”. The process is always directed to the future of the individual as well as the organization where they are affiliated. Meanwhile, Hendry and associates (1997 cited in Bilgin 2007) identifies performance management as the means to pinpoint who or what brings the biggest and most significant leap towards performance in relation to the overall organizational strategy and objectives. The results of the process are used to ensure that performance is successfully carried out in all aspects. Like Anderson and colleagues, Hendry and associates avow that performance management is a holistic process. For them, the effective process of performance management is carried out by setting up specific objectives based on corporate, department, team and individual levels. Then, there should be a definite and standardized performance appraisal system, reward strategies and schemes, as well as training and development strategies and plans. While all of these are executed, an effective performance management necessitates feedback, communication and coaching. The results of performance appraisal are used in individual career planning. Most importantly, there are mechanisms for monitoring the effectiveness of performance management system and interventions.
Most management authors acknowledge the benefits of effective performance management based primarily on a monitored performance management system. These benefits include enhanced work performance among employees, identification of potential individuals for advancement, augmentation of planning process for HR needs, achievement of business objectives, improved confidence and customer satisfaction, provided support for competitive advantage, established relationship on pay and performance scheme, and improved quality of supervision (Glendenning 2002). Performance management, as identified previously, is not just about appraisal. On the case of expatriates or people working in a foreign country, performance management on its most effective application includes the aspects of planning, monitoring, developing, rating, and rewarding of performance.
For an international assignment, each company invests a variety of organizational resources including economic, technological, and many other means (Newstrom 2002). There is a need to maximize these resources and use them towards a common purpose of achieving prescribed objectives (Pearce and Robinson 2000, p. 235). Expatriates are expected to deal with a new environment, anticipate changes, and adapt to it (Robbins and Judge 2007, p. 387). Expatriates are able to survive an international assignment if they are able to go along with the culture of the host country. Performance management is used to determine such.
The following discussion focuses on the key aspects of performance management and how to achieve them.
Planning refers to the process of setting objectives in line to the overall organizational objectives based on individual or group level. The planning aspect of performance management is directly associated with the coming up of organizational goals, designing a strategy to reach goals, and implementing a comprehensive set of plans to integrate and direct organizational activities (Jacoby 2004, p. 147). The planning process is very important because it is the first step towards implementation of any organizational operations. In order for an expatriate to be effective, he/she must be able to see beyond future and foresee work challenges that may affect the entire organization including its immediate environment and circumstances so that he/she will be able to come up with plans. In planning, there is the process of devising and maintaining a workable scheme to accomplish in response to a need or demand (Butcher and Clark 2003, p. 479) based on performance elements and standards. These elements and standards are expected to be SMART (specific, measurable, achievable, realistic and time-bound). Thus, HR managers are entitled to develop written performance management plans for all significant undertakings. They need to document and distribute the plan to all people concerned. Employees may also be included in devising plans. In several cases, the participation of an identified team in planning functions, decision-making, and using planning tools effectively make up a successful outcome in terms of the overall process.
Monitoring is the constant measurement of performance and ensuring current feedback on the progression of achieving established goals. Monitoring is the key task particularly on the aspect of organization’s performance (Drejer 2002). If assigned internationally, an employee is being monitored continually. The monitoring process is used to identify if he/she is able to deliver what is expected. Effective monitoring is the constant measurement of performance based on elements and standards. It also provides ongoing response to employees and work groups particularly on their progress toward the realization of their goals identified in the planning process. Through monitoring, needs for development, ratings, and other HR needs are identified.
Developing is the aspect where there is a need to evaluate and address developmental needs of individuals or groups involved in the achievement of goal. The aspect of development in performance management is seen on the necessity to invest on the advancement of competencies of employees to perform. Developmental needs are given through various ways like sponsored trainings. New assignments are also given to introduce new skills or initiate higher levels of responsibility. Introduction of new work processes or other work methods are also possible ways for development. These ways may result to superior performance as it boost job-related skills and competencies and aid employees in going along with several changes affecting them and the workplace (e.g. new technology).
Rating is the evaluation of performance based on given elements and standards. According to the result of survey conducted by Woods (2003) among Australian and Singaporean expatriates, the most common methods of appraisal is based on “set indicators (75 per cent of sample), rating of specific competencies (69 per cent), management by objectives (33 per cent) and set and evaluate personal goals (33 per cent)” (p. 530). Rating is important as it identifies the effectiveness of an individual or group in terms of job responsibilities and other related aspects as identified in the performance elements and standards. A rating of record is assigned based on the given procedures integrated in the appraisal plan and based on executed work during the overall appraisal period. For international employees, the rating aspect shows their effectiveness or ineffectiveness of performance.
Rewarding is the aspect where the individuals or groups are recognized for successfully achieving set goals. It is incorporated in the HR strategy of all organizations to implement different kind of rewards system or recognition system in order to motivate employees and organization morale (Sambrook 2000, p. 160). In rewarding employees, organizations need to identify the role of the individual or group in terms of performing the prescribed objectives. Rewards may come in terms of financial and non-financial forms. The idea on rewarding is supported by motivational theories. The organization holds regulations on the aspect of rewards. For international assignments, rewarding aspect may follow after successful achievement of objectives or effective performance.
All in all, the key aspects of performance management is not only seen on performance appraisal but also on the practice of good performance based on the overall strategy of the organization. Goals are set through planning. The progress of each goal is monitored. High standards are expected to be implemented and results to the need to develop. The performance is rated and rewarded formally or informally. All five key processes in performance management should work together and support each other (integrated, strategic and systematic) to achieve expected and effective performance management.
HSBC and the Application of Effective Performance Management
According to the facts from their corporate web page, HSBC is known as one of the largest financial and banking services industries that operate in various global locations. Headquartered in London, HSBC has over 10,000 offices in more than 82 states and territories in within Asia-Pacific Region, Europe, America, Africa and Middle East. HSBC have around 200,000 shareholders in over 100 nations particularly on highly industrialized cities like New York, Bermuda, Paris and Hong Kong. Because of the global network connects by the implementation of advances technology like the internet and ICT, HSBC has been able to provide an intensive range and reach of financial services which includes commercial banking, investment banking and market personal financial services, and other banking and financial products and services. The business philosophy of HSBC gives important to values and principles in all aspects of everyday living.
HSBC has also been able to use a strategic human resource management that provides concentrated and complete value among their employees. On the case of HSBC, their expatriation policy is admirable. They successfully implements expatriation programs like training, career development and fair remuneration packages. Basically, HSBC conducts global seminars all year round to explain the advantages and challenges of living and working overseas. This is essential to employees who are potential for an international job posting. Since HSBC has numerous global branches, there is a need to educate employees on the aspect of expatriation. It is identified that HSBC hires employees within the specified area but there are positions that require special attention, like requiring a foreign manager or employee. HSBC recruits repatriate careers based on single status and the ability to accept a move to a new post every four years (Mead 2005, p. 388). This policy is considered of benefits to the Company because it is more flexible, cheaper, and reduces administrative workload. In performance management, HSBC looks on the most effective ways to manage their resources and at the same time ensuring the achievement of prescribed objectives.
The key aspects of HSBC performance management include all the mentioned aspects of planning, monitoring, developing, rating, and rewarding. However, the aspect of planning and developing are quite interesting to focus. On planning, HSBC looks for potential employees to be assigned overseas as based on qualifications and needs. The overall goal of HSBC is to deliver values and principles in all aspects of everyday living. All plans are integrated in the global strategy and are executed in their own unique ways. The case of a single individual and the willing to accept a new post for the next four years is a manifestation of a progressive performance management. The duration of four years is tantamount to a variety of developmental attributes intended for career development and progression on individual level as well as organizational level. On the other hand, the aspect of developing is evidently outstanding as HSBC provides seminars to inform employees about expatriation. The performance management of HSBC is reflected to be effective because of these two identified aspects. Also, the case of a single expatriate is applicable. Naturally, there are still problems that HSBC encounter in their expatriation policy particularly on performance management. Like any other organization that operates in global setting, the problem of changing environment and nature of work may require a change in existing organizational performance management mechanisms.
Conclusion
Performance management is the integrated, strategic and systematic process of appraising and developing core competencies of individuals and groups. This principle is used in international management, with the addition of the global setting. The key aspects of effective performance management among expatriates are largely similar to traditional performance management. The aspects of planning, monitoring, developing, rating, and rewarding are still applicable among expatriates. The case of HSBC shows the need for expatriates to understand performance management. HSBC’s outstanding HR strategy particularly on performance management is equated to effective achievement of organizational objectives. Their performance management aspects of planning and developing are noteworthy as these are uniquely used by them. Based on the above case, HSBC needs to anticipate emerging HR trends for expatriates in terms of performance evaluation. Expatriation must be well thought and deliberate. It should cater to the current need of the Company. In terms of performance management mechanisms, HSBC’s performance appraisal should be in line with the current conditions of the Company as well as the nature of work. All in all, HSBC must be prepared with practical and effective means on how to manage the organizational requirements amidst the ongoing global financial challenge.
References
— (2009) HSBC Group Holding, [online] (cited 05 February 2009) Available from www.hsbc.com
Andersen, B, Henriksen, B and Aarseth, W (2006) ‘Holistic performance management: an integrated framework’, International Journal of Productivity and Performance Management, 55; 1, 61-78
Armstrong, M and Baron, A (1998) ‘Out of the tick box’, People Management, 4; 15, 38-39 cited in Bilgin, KU (2007) ‘Performance Management for Public Personnel: Multi-Analysis Approach toward Personnel’, Public Personnel Management, 36; 2, 93+
Beardwell, I and Holden, L (2001) Human Resource Management: A Contemporary Approach, Pearson Education, Harlow, England
Butcher, D and Clarke, M 2003, ‘Redefining Managerial Work: Smart Politics’, Management Decision, 41; 5, 477-487
Drejer, A 2002, Strategic Management and Core Competencies: Theory and Application, Quorum Books, Westport, CT
Glendinning, PM (Summer 2002) ‘Performance Management: Pariah or Messiah’, Public Personnel Management, 31; 2, 162
Hendry, C, Bradley, P and Perkins, S (1997) ‘Missed a motivator?’, People Management, 3;10, 20-25 cited in Bilgin, KU (2007) ‘Performance Management for Public Personnel: Multi-Analysis Approach toward Personnel’, Public Personnel Management, 36; 2, 93+
Jacoby, SM 2004, Employing Bureaucracy: Managers, Unions, and the Transformation of Work in the 20th Century, Lawrence Erlbaum Associates, Mahwah, NJ
Mead, R (2005) International Management: Cross-cultural Dimensions, 3rd edn, Blackwell Publishing, Oxford
Newstrom, JW 2002, ‘Making Work Fun: An Important Role for Managers’, SAM Advanced Management Journal, 67; 1, 5
Pearce, JA and Robinson, RB 2000, Strategic Management: Formulation, Implementation and Control, Irwin/McGraw Hill, Boston, MA
Robbins, SP and Judge, TA 2007, Organizational Behavior 12th ed., Pearson Education, Upper Saddle River, NJ
Sambrook, S (2000) ‘Talking of HRD’, Human Resource Development International, 3: 2, 159-178
Woods, P (2003) ‘Performance management of Australian and Singaporean expatriates’, International Journal of Manpower, 24; 5, 517-534
Credit:ivythesis.typepad.com
0 comments:
Post a Comment
Click to see the code!
To insert emoticon you must added at least one space before the code.