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Aligning Employee Performance Plans with Organizational Goals

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Performance management is the systematic process of planning work and setting expectations, continually monitoring performance, developing the capacity to perform, periodically rating performance in a summary fashion, and rewarding good performance.
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Content Preview
A Handbook for
Aligning Employee Performance Plans
with Organizational Goals
Personnel Management
WorkforceCompensation andPerformanceService

Table of Contents
Foreword . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Chapter 1 Performance Management: Background and Context . . . . . 3
Chapter 2 Distinguishing Activities From Accomplishments . . . . . . . . . 11
The Fable of the Beekeepers and Their Bees . . . . . . . . . . . . . . . . . . . 11
A Balanced Measuring System
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
A Word About Categories of Work
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Chapter 3 Developing Employee Performance Plans . . . . . . . . . . . . . . . 19
Step 1 Look at the Overall Picture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Step 2 Determine Work Unit Accomplishments
. . . . . . . . . . . . . . . . . 26
Method A: Goal Cascading Method . . . . . . . . . . . . . . 27
Method B: Customer-Focused Method
. . . . . . . . . . 30
Method C: Work Flow Method
. . . . . . . . . . . . . . . . . . 33
Step 3 Determine Individual Accomplishments . . . . . . . . . . . . . . . . . 37
Step 4 Convert Accomplishments Into Performance Elements
. . . 41
Step 5 Determine Measures
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
Step 6 Develop Standards
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
Step 7 Determine How to Monitor Performance
. . . . . . . . . . . . . . . . . 58
Step 8 Check the Performance Plan
. . . . . . . . . . . . . . . . . . . . . . . . . . . 63
Chapter 4 Learning Aids . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
Performance Measurement Quiz With Answers . . . . . . . . . . . . . . . . . 67
Quick Reference for Developing Performance Plans

That Align With Organizational Goals . . . . . . . . . . . . . . . . . . 69
Appendix A: Examples of Standards Written at Five Levels . . . . . . . . . 73
Appendix B: Examples of Standards Written at Three Levels
. . . . . . . . 77
Appendix C: Examples of Standards Written at Two Levels
. . . . . . . . . 81

This handbook is designed for Federal supervi-
C Chapter 1 gives the background and context
sors and employees and presents an
of performance management that you will
eight-step process for developing employee
need to understand before beginning the
performance plans that are aligned with and
eight-step process;
support organizational goals. It also provides
C Chapter 2 defines accomplishments— which
guidelines for writing performance elements and
is key to using this handbook successfully;
standards that not only meet regulatory require-
C Chapter 3 includes a detailed description of
ments, but also maximize the capability that
the eight-step process for developing em-
performance plans have for focusing employee
ployee performance plans that are aligned
efforts on achieving organizational and group
with and support organizational goals.
C Chapter 4 provides study tools, including a
followup quiz and a quick reference for the
The methods presented here are designed to
eight-step process.
develop elements and standards that measure
C The appendices contain standards intended
employee and work unit accomplishments
to serve as illustrations of standards written
rather than to develop other measures that are
for appraisal programs that appraise perfor-
often used in appraising performance, such as
mance on elements at five, three, and two
measuring behaviors or competencies.
Although this handbook includes a discussion of
the importance of balancing measures, the main
After reading the instructional material, studying
focus presented here is to measure accomplish-
the examples, and completing the exercises in
ments. Consequently, much of the information
this book, you should be able to:
presented in the first five steps of this eight-step
C develop a performance plan that aligns indi-
process applies when supervisors and employ-
vidual performance to organizational goals;
ees want to measure results. However, the
C use a variety of methods to determine work
material presented in Steps 6 through 8—about
unit and individual accomplishments;
developing standards, monitoring performance,
C determine the difference between activities
and checking the performance plan—apply to
and accomplishments; and
all measurement approaches.
C explain regulatory requirements for
employee performance plans.
The handbook has four chapters and
A Handbook for Measuring Employee Performance

This page left blank.
Performance Management Practitioner Series

Chapter 1
Performance Management:
Background and Context
Remember the story about the naive student
Performance management is the systematic pro-
in his first English literature course who was
cess of:
worried because he didn’t know what prose
was? When he found out that prose was

planning work and setting expectations,
ordinary speech, he exclaimed, “Wow! I’ve
C continually monitoring performance,
been speaking prose all my life!”

developing the capacity to perform,

periodically rating performance in a
Managing performance well is like speaking
summary fashion, and
prose. Many managers have been “speaking”

rewarding good performance.
and practicing effective performance manage-
ment naturally all their supervisory lives, but
The revisions made in 1995 to the Govern-
don’t know it!
mentwide performance appraisal and awards
regulations support “natural” performance man-
Some people mistakenly assume that perfor-
agement. Great care was taken to ensure that
mance management is concerned only with fol-
the requirements those regulations establish
lowing regulatory requirements to appraise and
would complement and not conflict with the
rate performance. Actually, assigning ratings of
kinds of activities and actions effective managers
record is only one part of the overall process
are practicing as a matter of course.
(and perhaps the least important part).
Performance Management’s Five Key Components
A Handbook for Measuring Employee Performance

Performance Management: Background and Context
Planning. In an effective organization, work
atic standards. By monitoring continually, su-
is planned out in advance. Planning means
pervisors can identify unacceptable performance
setting performance expectations and goals for
at any time during the appraisal period and pro-
groups and individuals to channel their efforts
vide assistance to address such performance
toward achieving organizational objectives.
rather than wait until the end of the period when
Getting employees involved in the planning pro-
summary rating levels are assigned.
cess will help them understand the goals of the
organization, what needs to be done, why it
Developing. In an effective organization,
needs to be done, and how well it should be
employee developmental needs are evaluated
and addressed. Developing in this instance
means increasing the capacity to perform
The regulatory requirements for planning employ- through training, giving assignments that intro-
ees’ performance include establishing the ele-
duce new skills or higher levels of responsibility,
ments and standards of their performance ap-
improving work processes, or other methods.
praisal plans. Performance elements and stan-
Providing employees with training and devel-
dards should be measurable, understandable,
opmental opportunities encourages good per-
verifiable, equitable, and achievable. Through
formance, strengthens job-related skills and
critical elements, employees are held account-
competencies, and helps employees keep up
able as individuals for work assignments or
with changes in the workplace, such as the in-
responsibilities. Employee performance plans
troduction of new technology.
should be flexible so that they can be adjusted
for changing program objectives and work
Carrying out the processes of performance
requirements. When used effectively, these
management provides an excellent opportunity
plans can be beneficial working documents that
for supervisors and employees to identify devel-
are discussed often, and not merely paperwork
opmental needs. While planning and monitoring
that is filed in a drawer and seen only when
work, deficiencies in performance become evi-
ratings of record are required.
dent and should be addressed. Areas for
improving good performance also stand out,
Monitoring. In an effective organization,
and action can be taken to help successful
assignments and projects are monitored contin-
employees improve even further.
ually. Monitoring well means consistently meas-
uring performance and providing ongoing feed-
Rating. From time to time, organizations find
back to employees and work groups on their
it useful to summarize employee performance.
progress toward reaching their goals.
This helps with comparing performance over
time or across a set of employees.
Regulatory requirements for monitoring perfor-
Organizations need to know who their best
mance include conducting progress
performers are.
reviews with employees where their perfor-
mance is compared against their elements and
Within the context of formal performance ap-
standards. Ongoing monitoring provides the
praisal requirements, rating means evaluating
supervisor the opportunity to check how well
employee or group performance against the
employees are meeting predetermined standards
elements and standards in an employee’s
and to make changes to unrealistic or problem-
performance plan and assigning a summary rat-
Performance Management Practitioner Series

Performance Management: Background and Context
ing of record. The rating of record is assigned
dards, but they also take care to develop the
according to procedures included in the organiza- skills needed to reach them. They also use for-
tion’s appraisal program. It is based on work
mal and informal rewards to recognize the be-
performed during an entire appraisal period.
havior and results that accomplish their mission.
The rating of record has a bearing on various
All five components working together and sup-
other personnel actions, such as granting within-
porting each other achieve natural, effective
grade pay increases and determining additional
performance management.
retention service credit in a reduction in force.
Employee Performance Plans
Rewarding. In an effective organization,
rewards are used well. Rewarding means rec-
Employees must know what they need to do to
ognizing employees, individually and as mem-
perform their jobs successfully. Expectations
bers of groups, for their performance and
for employee performance are established in
acknowledging their contributions to the agen-
employee performance plans. Employee per-
cy’s mission. A basic principle of effective
formance plans are all of the written, or other-
management is that all behavior is controlled by
wise recorded, performance elements that set
its consequences. Those consequences can
and should be both formal and informal and
both positive and negative.
A Note About Performance Plans:
This handbook is about developing employee
Good managers don’t wait for their organi-
performance plans. However, there is
zation to solicit nominations for formal
another type of performance plan that you
awards before recognizing good perfor-
need to be aware of. The Government Per-
mance. Recognition is an ongoing, natural
formance and Results Act of 1993 requires
part of day-to-day experience. A lot of the
each agency to prepare an annual perfor-
actions that reward good performance—like
mance plan covering each program activity set
saying “Thank you”—don’t require a spe-
forth in its budget. These organizational per-
cific regulatory authority. Nonetheless,
formance plans:
awards regulations provide a broad range of
C establish program-level performance goals
forms that more formal rewards can take,
that are objective, quantifiable, and mea-
such as cash, time off, and many recognition
items. The regulations also cover a variety
C describe the operational resources needed
of contributions that can be rewarded, from
to meet those goals; and
suggestions to group accomplishments.
C establish performance indicators to be used
in measuring the outcomes of each pro-
Performance Management as
Prose. Good managers have been speak-
ing and practicing effective performance
We will be using organizational performance
management all their lives, executing each
plans during Step 1 of the eight-step process
key component process well. They not only
presented in this handbook. Organizational
set goals and plan work routinely, they mea-
performance plans are key in the process of
sure progress toward those goals and give
aligning employee performance with organi-
feedback to employees. They set high stan-
zational goals.
A Handbook for Measuring Employee Performance

Performance Management: Background and Context
forth expected performance. A plan must
elements, which can result in the employee’s
include all critical and non-critical elements and
reassignment, removal, or reduction in grade.
their performance standards.
Consequently, critical elements must describe
work assignments and responsibilities that are
Performance elements tell employees what they
within the employee’s control. For most
have to do and standards tell them how well
employees this means that critical elements can-
they have to do it. Developing elements and
not describe a group’s performance. How-
standards that are understandable, measurable,
ever, a supervisor or manager can and should
attainable, fair, and challenging is vital to the
be held accountable for seeing that results mea-
effectiveness of the performance appraisal pro-
sured at the group or team level are achieved.
cess and is what this handbook is all about.
Critical elements assessing group performance
may be appropriate to include in the perfor-
Federal regulations define three types of ele-
mance plan of a supervisor, manager, or team
ments: critical elements, non-critical elements,
leader who can reasonably be expected to
and additional performance elements. Agency
command the production and resources neces-
appraisal programs are required to use critical
sary to achieve the results (i.e., be held individu-
elements (although the agency may choose to
ally accountable).
call them something else), but the other two
types can be used at the agency’s option.
Non-critical Elements. A non-critical
Before continuing further with this handbook,
element is a dimension or aspect of individual,
you should contact your human resources office
team, or organizational performance, exclusive
to determine the types of elements your
of a critical element, that is used in assigning a
appraisal program allows.
summary level. Important aspects of non-criti-
cal elements include:
Critical Elements. A critical element is an
assignment or responsibility of such importance
that unacceptable performance in that element
A Note about Group or Team
would result in a determination that the employ-
Performance: The term “group or
ee’s overall performance is unacceptable. Reg-
team performance” can be confusing
ulations require that each employee have at least
sometimes. When we say that critical ele-
one critical element in his or her performance
ments cannot describe group performance,
plan. Even though no maximum number is
we are saying that the group’s perfor-
placed on the number of critical elements possi-
mance as a whole cannot be used as a crit-
ble, most experts in the field of performance
ical element. This does not preclude de-
management agree that between three and
scribing an individual’s contribution to the
seven critical elements are appropriate for most
group as a critical element. The key to
work situations.
distinguishing between group performance
and an individual’s contribution to the
Critical elements are the cornerstone of individ-
group is that group performance is mea-
ual accountability in employee performance
sured at an aggregate level, not for a single
management. Unacceptable performance is
employee. An individual’s contribution to
defined in section 4301(3) of title 5, United
the group is measured at the individual em-
States Code, as failure on one or more critical
ployee level.
Performance Management Practitioner Series

Performance Management: Background and Context
how an appraisal program is designed, this
No Performance-based Actions. Failure on a
need not be the case. Even though consider-
non-critical element cannot be used as the basis
ation of non-critical elements cannot result in
for a performance-based adverse action, such
assigning an Unacceptable summary level,
as a demotion or removal. Only critical ele-
appraisal programs can be designed so that
ments may be used that way. Moreover, if an
non-critical elements have as much weight or
employee fails on a non-critical element, the
more weight than critical elements in deter-
employee’s performance cannot be summarized
mining summary levels above Unacceptable.
as Unacceptable overall based on that failure.
NOTE: Before you can use non-critical elements
in employee performance plans, you must deter-
C Group Performance. Non-critical
mine if your appraisal program allows them.
elements are the only way an agency can
include the group’s or the team’s perfor-
Additional Performance Elements. An
mance as an element in the performance plan
additional performance element is a dimension
so that it counts in the summary level. For
or aspect of individual, team, or organizational
example, team-structured organizations might
performance that is not a critical element and is
use a non-critical element to plan, track, and
not used in assigning a summary rating level.
appraise the team on achieving its goals. To
The essential difference between a non-critical
do this, each team member’s performance
element and an additional performance element
plan would include the “team” element (i.e., a
is that non-critical elements do affect the sum-
non-critical element) and the rating for the
mary level. Otherwise, the features and limita-
team on that element would be counted in the
tions of non-critical elements discussed above
summary level of each team member.
also apply to additional performance elements.
Opportunities for using additional performance
C When They Can’t Be Used. Non-critical
elements include:
elements cannot be used in appraisal pro-
grams that use only two levels to summarize
C New Work Assignment. Managers and
performance in the rating of record. This is
employees may want to establish goals, track
because they would have no effect on the
and measure performance, and develop
summary rating level and, by definition, they
skills for an aspect of work that they do not
must affect the summary level. (That is, in a
believe should count in the summary level.
two-level program, failure on non-critical ele-
For example, if an employee volunteered to
ments cannot bring the summary level down
work on a new project that
to Unacceptable, and assessments of non-
requires new skills, an additional performance
critical elements cannot raise the summary
element describing the new assignment pro-
level to Fully Successful if a critical element
vides a non-threatening vehicle for planning,
is failed.)
measuring, and giving feedback on the
employee’s performance without counting it in
C Can Greatly Affect the Summary Level.
the summary level.
Sometimes the word “non-critical” is interpre-
ted to mean “not as important.” Prior to
C Group Performance. In a two-level
1995, this interpretation was prescribed by
appraisal program, additional performance
regulation. Now, however, depending on
elements are the only way to include a discus-
A Handbook for Measuring Employee Performance

Performance Management: Background and Context
sion of group performance in the appraisal
Additional performance elements were intro-
process. Even though the element assessment
duced in the September 1995 performance
does not count when determining the sum-
appraisal regulations and have not been used
mary level, managers and employees could
widely, yet. We foresee their popularity ris-ing
use it to manage the group’s performance.
as agencies discover the possibilities they pres-
ent for managing performance.
C Awards. Additional performance elements
can be used to establish criteria for determin-
NOTE: Check the rules of your program before
ing awards eligibility, especially in a two-level
including additional performance elements in
program that no longer bases awards solely
your plans.
on a summary level.
Element Characteristics
Required in

Credited in the
Can Describe
a Group’s
*except when written for a
supervisor or manager who has
individual management control
over a group’s production and

Performance Management Practitioner Series

Document Outline
  • Table of Contents
  • Foreward
  • Chapter 1 Performance Management: Background and Context
  • Chapter 2 Distinguishing Activities from Accomplishments
  • The Fable of the Beekeepers and Their Bees
  • A Balanced Measuring System
  • A Word About Categories of Work
  • Chapter 3 Developing Employee Performance Plans
  • Step 1 Look at the Overall Picture
  • Step 2 Determine Work Unit Accomplishments
  • Method A: Goal Cascading Method
  • Method B: Customer-Focused Method
  • Method C: Work Flow Method
  • Step 3 Determine Individual Accomplishments
  • Step 4 Convert Accomplishments Into Performance Elements
  • Step 5 Determine Measures
  • Step 6 Develop Standards
  • Step 7 Determine How to Monitor Performance
  • Step 8 Check the Performance Plan
  • Chapter 4 Learning Aids
  • Performance Measurement Quiz (with answer key)
  • Quick Reference for Developing Performance Plans that Align with Organizational Goals
  • Appendix A: Examples of Standards at 5 Levels
  • Appendix B: Examples of Standards at 3 Levels
  • Appendix C: Examples of Standards at 2 Levels

Aligning Employee Performance Plans with Organizational Goals



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