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DIPLOMA IN BUSINESS ENTERPRISE
HUMAN RESOURCE MANAGEMENT IN INNOVATION
Title: ASSIGNMENT 1: PERFORMANCE MANAGEMENT
Assessed Learning Outcome 4:
Elements: Explain, evaluate and justify the importance of an
effective performance management system for a new enterprise.
Conditions: Individual Assignment
Performance Management –
Adding value or stifling success?
Length: Maximum 2,000
Overall course weighting: 30% (will be marked out of 50)
Due Date: Friday 27th
November 2015, 11.55pm
This assignment is based on the following
fictitious business called the Lion Office Systems Ltd.docx#_ftn1″ title=””>
Use thecase study below to answer the
questions that follow. You are to imagine that you are an HR Manager in the
Human Resource Department advising the General Manager of the Business, Ms Petra
Rijash. Wherever possible provide examples applicable to the business in
The report should be typed using a word
processor such as MS Word, and it must be laid out in a format that is clear
and easy to read. Use heading styles within the document to create an automatic
table of contents. The title page, table of contents and appendices are not
included in the word count.
Prepare a report on the following matters:
Include an Executive summary
that explains to Petrathe purpose of a performance management system and how it
would benefit the organisation’s operations. Identify the factors that would
make performance management system(s) successful in adding value to the
Outline a suitable performance
management system(s) to be used by the organisation.You must set out the key
features of a performance management system that will be effective in adding
value to the organisation. You must justify the choices you have made in
respect of the performance management system you recommend.
Often performance reviews do
not achieve what they are intended to achieve. Explain to Petrawhat she needs
to do to ensure performance reviews are effective, within the organisation.
Explain how a performance
appraisal system should link with training, counselling and career development.
CASE STUDY – Lion Office Systems
Background introduction to the Lion Office Systems
Lion Office Systems is a small but growing
business in office equipment and services. It started as a Printing firm, and
has recently expanded by acquisition and merger to incorporate equipment and
The Managing Director, Ms Petra Rijash, is
keen to consolidate its current customer base and market position, and at the
same time develop a cohesive company culture with common systems. Over the
coming year, there is expected to be significant change in systems relating to
Human Resource Management and Customer Relationship Management. This is
expected to promote improved knowledge sharing and expand sales through
increasing services and sales volume to existing customers. It is now intent on
consolidating its customer base, rather than expanding its present base, so the
short-term focus will be on improving the relationship with current customers.
Some 165 employees work in the three operating
divisions and at head office and associated support functions of finance and HR.
The numbers employed at each site are indicated on the organisation chart
below. The head office is located in Nelson in premises which are shared with
the Office Equipment and Computers Division. The Office Supplies Division is
located in Richmond, approximately 13 km south of Nelson, while the Printing
Division is located in Stoke, between Richmond and Nelson.
The firm is organised on a divisional basis
The company is staffed as follows:
Head Office, Finance and HRM:
Managing Director, Finance Director,
Administration Manager, Human Resource Manager and 25 administrative and
Office Equipment and Computers Division:
Divisional Director plus 15 specialist and
administrative staff; 22 staff in printer/photocopier department (sales office,
representatives and service engineers); 27 staff in computer equipment
department (sales office, representatives and technical support staff).
Office Supplies Division:
Divisional Manager plus 4 admin staff, 5
staff in purchasing, 17 in sales and 15 warehouse staff including 4 drivers.
Divisional manager plus 6 clerical/admin
staff; 20 production staff (printing, binding etc), 7 sales staff and 3
Business and Employee Relations
The state of business and employee relations
in each of the firm’s main units are as follows:
In an effort to achieve greater integration
of the total business, the directors have increased the role of head office in
developing financial and administrative procedures applicable thoughout the
organisation. The Human Resources function has been strengthened by the
appointment of a full-time Human Resources Manager, supported by a Payroll and
Administrative Officer. The HR Manager’s task will be to introduce uniform
procedures on key matters such as performance management, including
disciplinary and grievance matters, succession planning and learning and
development planning. This will be supported through the introduction of a
computerised HRM system. The admin and clerical staff are mostly local people
and the turnover is very low. Salaries are competitive without being generous.
Office Equipment and Computers Division:
Printer/Photocopier sales/servicing are
maintaining their market position, but at an increasing cost to the company.
Salaries are moderate, although commission for sales staff can be attractive.
Admin/clerical staff are paid at competitive rates. Turnover is low among the
latter, but higher among the sales people and the service engineers. The
computer department is still expanding in terms of sales, mostly due to the
introduction of tablets and hybrid computers, and commission rates are good.
Office sales salaries are modest. Although morale seems high, there is
nevertheless a relatively high level of turnover of sales people and technical
support staff, most of whom are young, ambitious and highly marketable in a
very competitive market.
Office Supplies Division:
Business is expanding for consumable office
supplies, and the company has increased its market share in the Nelson/Marlborough
area. Wages and salaries are lower than the other divisions, but staff turnover
is quite low, except on the sales side. The warehouse and transport employees
are all members of First Union. The management would like to expand its online
sales presence to supply up to 70% of its sales through internet marketing and
Business is just being maintained in the face
of fierce competition from Nelson franchise operations. Wages on the production
side are high in comparison with other sections of the company, but average in
sales and purchasing. The workforce is very stable and the employees are
generally older than in the other divisions. The machinery in use is modern.
All employees are members of First Union.
Key strategic targets include:
Ø Increase the
competitiveness of every division, to become the market leader in terms of quality
customer service in the Nelson/Marlborough region by end of 2016.
Ø Speed up the
introduction of Online Sales; a computerised Customer Relationship Management (CRM)
system and a Human Resource Management (HRM) system, with a target
implementation date of 1 April, 2016 for the Online Sales and CRM systems, and
1 June for the HRM system.
Ø Reduce costs by
10% in relation to sales/output by necessary restructuring, even if this means
This will require the full commitment of the
present staff and there will need to be some training offered to the current
staff and training needs completed for any new staff hired in the future.
The business objectives for the Lion
Office Systems are:
achieve 95% customer satisfaction
internet sales from current levels of 5% to 70% over the next 2 years
Ø Return at
least 15% on investment annually
waste, energy and water use by 20% over the next 2 years
professional development and training to all staff
Qualmark environmental standards within 2 years
Ø To recruit
any new staff from outside the Nelson region over the next 2 years.
(home users) Nelson/Marlborough
Full time salaried staff ranges are:
Ø A. General
Manager (GM) 150,000–180,00
Ø B. Financeand
HR Manager 80,000-120,000
Ø C. Business
Division Managers 40,000-60,000
Ø D. Sales
Technical staff 40,000-60,000
Purchasing and Production staff 25,000-35,000
Ø G. Warehouse
and Transport staff 35,000-50,000
Casual staff are employed on fixed term
contracts. All positions have current
employment agreements. Amongst other
information required, they include employer and employee obligations in the
case of misconduct or poor performance.
3a) Explain to Petra the
3b) Outline a suitable
8-10 Marks, excellent –
8-10 Marks, excellent outlines
3c) Explain what is
3d) Briefly explain how a
.docx#_ftnref1″ title=””>Adapted from a case study in “Personnel
Management” 4th ed G.A. Cole (1997)