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Performance management

Tesco’s needs to mange the performance of its employees effectively if it is to remain as the UK’s leading retailer and maintain a competitive edge. This means that there must be an effective management control exercised at both individual and organisational level. A range of processes and techniques are placed within all Tesco stores and in the Tesco offices, which allow individual employees to know how well they are doing, and for managers to be able to monitor how well their subordinates are performing.

Performance monitoring provides information, which is of value for identifying future training or promotion opportunities, and areas where insufficient skills or knowledge could be deemed a threat to an employee’s efficiency. Tesco’s managers exercise control at an individual and organisational level through: Planning by setting objectives and targets. Establishing performance standards. Rectifying mistakes and taking action. Monitoring actual performance. Comparing performance against targets.

6ai Management by objectives The process described above contributes to management by objectives, in which the performance of the individual and Tesco’s is consistently being measured against objectives and targets, which have been agreed jointly by managers and employees. An objective relates to something, which is to be achieved by a team or an individual.

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Objectives should be determined through discussions between Tesco’s managers and Tesco’s employees. This involves both a top-down and a bottom-up approach.

Thus meaning that managers must make the effort to consult all employees regardless of their statue within Tesco, and employees should consult managers if they feel that they would like to make any further input. The manager presents corporate, individual objectives and team members before stating what they feel can be achieved. This process is more likely to be successful if the objectives meet the SMART criteria. They should be: S – Smart M – Measurable A – Agreed R – Reliable T – Time-related 3. 6aii Monitoring Performance

The monitoring process requires the measurement of performance and then linking these performance measurements against the achievement of objectives (and targets). Measurements may be made as indicators such as output, sales and profits over a specified period. When comparing performance with targets, an account has to be taken of the general context in which a particular operation is taking place. A Tesco’s director who just falls short of his or her target profit figure may in reality have performed very well because, because Tesco may have been operating in the face of a major economic downturn.

The monitoring of quality standards is very often performed against set criteria defining different levels of quality standards. These criteria are used to form the basis of a customer opinion survey, which could be undertaken by sending a questionnaire to a cross section of Tesco customers or through a telephone survey. Tesco may also find it helpful to make behavioural assessments, which measure an employee’s approach and attitude towards his or her job. Essentially, this focuses on the process of the job, on what an individual actually does.

3. 6b Employee motivation Motivation describes the extent to which an individual makes an effort to do something. Tesco’s are likely to improve performance in terms of customer care, attendance rates, cooperation and quality of tasks performed if they can find ways of increasing the willingness of their employees to perform tasks with greater effort. Tesco’s have managed to achieve this through a variety of means, which have been aimed at increasing an individual’s job satisfaction and are highlighted by a different theoretical basis.

Job satisfaction at Tesco’s is achieved through the working environment, and is influenced by factors such as target setting, responsibility, independence, teamwork, interaction and achievement. For example the Slough branch Tesco supermarket has an electronic department, therefore they may be set a realistic target during the Christmas period, such as selling fifteen stereo systems and ten television sets with a built-in video player and if this was to be achieved Tesco’s may offer the employees of that department a bonus or seasonal gifts.

Therefore employees become further motivated by such incentives and begin to work with greater effort individually and as a team. Thus creating further motivation for Tesco’s workforce resulting in higher levels of profitability from stock turnover. Motivation is also generated at Tesco by offering employees a pay increase, promotion or simply by the status and satisfaction associated with possessing a new skill and using the most up-to-date machinery and equipment.

For example a cashier at Tesco would not expect to be using a cash point where the cashier enters the amount of the product upon the system, instead Tesco use an up-to-date scanning system known as “Checkout Plus”, “Plus” meaning Price Look-up System. Thus meaning that Tesco use highly modified technology to scan products, which the customer wishes to purchase into the system. The term scanning is used to describe the use of a laser system to identify bar-codes upon products. The information relating to each bar-code is held in a computer linked to the scanning equipment.

As the bar-code is passed across the scanner it is read and the price and description are then obtained from the computer and the sale is registered. This form of technology available to Tesco employees that is to be used throughout their working day also acts as an incentive along with pay rises and promotion. Tesco department and store managers use both financial and non-financial means to motivate employees, such as pay rise or extra benefits. In doing so, Tesco aim to minimise labour turnover, attract new recruits and create an effective, productive working environment.

Tesco recognises that in order to remain the UK’s leading retailer they need to be the UK’s favourite employer. Tesco’s employee satisfaction equation aims to show employees that rewards can be achieved through good performance. Employee satisfaction = Progression + Package + Experience (Internal promotion (Salary, bonus (Rewards and recognition) and benefits) working conditions) Tesco’s annual awards and management bonus schemes provide recognition and rewards, and the emphasis it places upon internal recruitment and promotion provides the opportunity for advancement. 3.

6bi Maslow’s hierarchy of needs Maslow’s work upon ‘Motivation and Personality’ is very closely linked to performance management. It suggests that people are motivated both by needs which are fundamental to their existence and also by those which are associated with mental characteristics or attitudes. These needs can be presented as a hierarchy, and Maslow assumes that, within the workplace, employees will strive to move up the hierarchy. In relation to Tesco’s it means that, initially, an employee’s physiological needs may be satisfied through the basic pay and comfort of the working environment.

He or she will then want to satisfy security needs by gaining greater job security and perhaps pension arrangements through existing Tesco Pension schemes. Membership of a lively team may help to satisfy social needs. Often a flash title and large company car may help to meet his or her need for self-esteem, and increasing levels of responsibility and control may satisfy self actualisation needs. By recognising where people are on Maslow’s hierarchy, Tesco’s can tailor their package of financial and non-financial rewards in order to increase staff motivation.

For example an employee who replenishes shelves for Tesco may feel motivated and encouraged to do well if he or she were to be rewarded with a seasonal gift or bonus, whilst a manager or department supervisor at Tesco would expect a more prestigious gift such as a pay increase or receive further control upon their department. Physiological Needs The physiological needs are shown at the bottom of the hierarchy because they tend to have the highest strength until they are somewhat satisfied.

These are the basic human needs to sustain life itself such as food, clothing and shelter. Until these basic needs are satisfied to the degree needed for the sufficient operation of the body, the majority of a person’s activity will probably be at this level, and the others will provide little motivation. For example a new employee at Tesco may be appointed as a trolley collector, he or she will not be concerned upon what others are doing until they have managed to achieve their goal.

Thus meaning that the employee will have very little motivation and determination to achieve greater things, as they’re currently satisfied with what they are doing due to the fact that their current task holds very little responsibility and supports them financially. Safety, or Security Needs Once physiological needs become gratified, the safety, or security, needs become predominant. These needs are essentially the need to be free of the fear of physical danger and deprivation of the basic physiological needs.

In other words, this is a need for self-preservation. In addition to the here and now, there is a concern for the future. An employee at Tesco who may have began as an assistant may then feel that he or she deserves a promotion. Thus displaying the desire that an employee then develops after the physiological stage. Once an employee at Tesco has sustained a job for a certain period of time and has obtained life’s essentials he or she then becomes concerned about the near future and feels the need to sustain and be assured of their job security.

Hence the reason why a Tesco employee may be vigilant upon upcoming job vacancies internally or externally. Social or Affiliation Needs Once physiological and safety needs are fairly well satisfied, social or affiliation will emerge as dominant in the need structure. Since people are social beings, they have a need to belong and to be accepted by various groups. When social needs become dominant, a person will strive for meaningful relations with others. Thus meaning that an employee at Tesco will feel the need to be associated to social cults or teams.

For example specifically during the Christmas period Tesco provide their employees the opportunity to socialise via team events and parties. Thus allowing employees to feel united and further create friendships amongst themselves. Therefore an employee at Tesco obtains the social and affiliation needs once they have managed to maintain and be assured of their job security, thus resulting in higher self-motivation levels whilst gaining confidence and broadening their social activities.

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