Setting Up a Performance Management System in a Small IT Firm Without ERP – Any Suggestions?

I have recently shifted to an IT company, which is a new industry for me, and this is a relatively smaller enterprise with an employee strength of about 40. I would like to know the best way to set up an effective Performance Management System (PMS) here for performance appraisals, etc. The management is not ready to spend on ERP/SAP. Please suggest.

Thanks,
Harshdeep

Thank you very much for the valuable inputs. I would appreciate it if you could provide me with a rough outline on how to set up a PMS in an IT software company where the HR department was nonexistent before my joining. To my knowledge, the first question to the management should be to determine if they have defined KPIs, which nobody seems to have any clue about. I am currently working on defining KRAs for individual profiles. Could you please shed some light on how to proceed further? Inputs from others are also welcome.

Thank you,

Harshdeep Singh

As Dinesh mentioned, it is easier said than done. However, it is not impossible. You mentioned that HR did not exist prior to your joining, which means you have to start from scratch. Therefore, manpower planning is very important. First, you need to have an organizational structure with a clear role for each position. Then you can consult with each departmental head about JD/KRA of their team members. Subsequently, KPIs can be defined.

And of course, at this stage, it would not be a wise idea to straightaway get into PMS without having the basics right. You can discuss with your management and do the PMS this year in the same way as they have been doing in the past. By next year, you can create a proper system for PMS, and that would be more effective.

Hope this will help you.

Regards,
Pramod

You can design the assessment form in Excel, and employees can use the same for yearly assessments. The benefit is that if later the company grows and acquires a system, the Excel form can be uploaded into the new system. Thus, the performance history of an employee will always remain available. Being an IT company, this is easy since all employees will have access to a computer.

Understanding Performance Management Systems (PMS)

Please note that you should be clear about PMS; it can easily be done through a manual process, and no automation is required. You have to understand the organization's line of business and their key goals associated with it. For example, for each organization, resource capacity utilization is a major challenge. If you define the organizational goals and later correlate them to the employees, you will definitely help the organization achieve desired outputs.

Regards,
Dinesh Kumar
Program Manager
Program Management Practices (PMO) (link updated to site home) (Search on Cite | Search on Google)

Dear Mr. Harshdeep, God bless you. I fully appreciate your top brass not wanting to invest in ready-made PMS solutions. Most of them are not suitable for your needs. Now, you have a very good opportunity to show your talent:

1. Get your knowledge of MS Excel updated.

2. If you are proficient, you could use MS Access, which can later be linked with your solution, either developed or bought.

3. Excel has immense possibilities for handling up to 1000 staff.

4. All these KRA and KPI are advanced steps and are dynamically changing periodically.

Steps to Implement a Performance Management System

5. Step 1: Start from the lowest resource on the ladder.

6. Make a chart and write out the job description of the table/position involving each person at the table to help you crystallize the job. Use their superior to rewrite it.

7. Then, outline their routine targets for the day/week/fortnight.

8. Step 2: Once you have taken time to understand the job description and the output expected from each person, allocate one sheet per employee and group them into departments. Assign table numbers/task numbers/employee numbers or anything you want and rename the sheet.

9. Step 3: Decide on the measuring tools to be employed for assessing performance. Use various qualities and rate them on a 9-point scale.

10. We can discuss quarterly/six-monthly/annual assessments in the next session.

Blessings,

Dr. Ram

To implement the PMS effectively, you have to motivate your workforce about the advantages of PMS and also manage the change during implementation. Both of these factors are very important for a successful PMS.

Thank you.