Reference no: EM133106557

Case Analysis: Performance Management System of DEF Finance Company

DEF Finance Company is a financing institution having 38 branches all over the Philippines. It is a highly centralized company having its corporate office in Cebu City. It conducts its performance appraisal twice a year, once every six months. It has a standardized performance appraisal tool every position. The PA tools performance indicators are measuring the following:

1. How many times the employee has been late and absent.

2. How many times the employee has committed error in their reports.

3. How many times it has failed to submit on time their deliverables.

4. If there are instances the employee has caught some troubles with their colleagues.

Once every six months, the supervisor conducts a one on one interview with his/her employees discussing the items reflected on the performance appraisals of the employee, including their strengths and weaknesses. Most of the time, the supervisor does the matter talking during this one on one discussion and that employees will just listen and then sign the performance appraisal.

The company provides a Performance Bonus to the employees. The performance bonus received by the employees is a uniform amount, meaning all employees received the same amount of bonus every year. Supervisors and managers are given 5,000 pesos on top of their PB amount. The management asserts that the reason why they are giving the uniform amount of PB is for fairness and equity so that there will be no complaints from their rank and file as to the amount received.

Given the situation above, make your own analysis of ABC Finance Company's Performance Management System. Discuss whether you agree or disagree with how they do their PMS. Give explanations and justifications why so and cite the theories and concepts that we have discussed in the course that will support your claim.