*please read through the task and provide descriptive answers accordingly.

THE aim is to be able to analyse the performance management challenges of authentic business case study. The key is to identify the core issues that affect successful management of performance and recommend practical solutions for change.*

You are the Human Resources (HR) Manager of Australian Recruitment Firm (ARF), founded in 2015, which is a recruitment agency specialising in placing potential employees with employers across a range of industries. Mark Strong has been CEO of the company since this time. During his tenure, Australian Recruitment Firm has rapidly grown to be a market leader in helping companies discover and retain the top talent in their respective markets. Feedback from clients has consistently improved each year. The company has also expanded considerably in only a short amount of time, from 5 recruitment consultants initially, to now employing 30 in its Sydney office. All staff work on behalf of various employers to find suitable candidates and to fill their vacancies with the best possible talent.

The group of 30 staff, managed by 5 team leaders, have developed a strong sense of collegiality working together at the Sydney office in recent years. In addition to having regular paid company lunches, an annual awards ceremony, and a competitive table tennis tournament, there was a high level of morale amongst workers.

Australian Recruitment Firm's performance appraisal system had several components. Each team of recruitment consultants would set their annual performance goals with their Team Leader in January. Then in July, Team Leaders would conduct a check-in to see how each team was performing against set targets as well as discuss areas for skill development. Each team was measured on how many placements they made per month and their quality of customer service, judged by star ratings and written feedback received from employers and iob seekers they worked with during this time. Each team would then receive a final appraisal and single performance score in December. This was linked to salary increases for the team for the following year and also an annual bonus for the best performing team. Mark has since left Australian Recruitment Firm to work at a competitor firm. From early 2020, David Wilhelm has taken over the position of CEO. David has worked for several large multinational organisations in management positions but this is his first time running a small company as CEO. David has been inspired from his reading of practitioner magazines about the future of performance management, particularly the benefits that flexible working practices can bring to company performance.

With Sydney rental prices increasing, in addition to the onset of the Covid-19 pandemic, David also believed the company could save money by moving into a smaller office space and having fewer staff coming into the office each

day.

Another initiative David considered was changing the company's approach to appraising performance through a forced distribution ranking to drive competitiveness and raise the performance of low-performers. A 5-level performance appraisal system would be introduced:

• 'Superior' performers (top 5%) were rated
• 1;
• 'Very good' performers (next 15%) were rated 2;
• 'Good' performers (next 70%) were rated 3;
• 'Marginal' performers (next 5%) were rated 4;
• 'Unsatisfactory' performers (bottom 5%) were rated 5.

Merit pay increases would only be awarded to those rated 1, 2 or 3, with the potential for bonus payments as well. Employees rated 4 or 5 would be given only modest legally required pay increases. Team Leaders would have discretion over how they determined the rating of employees in their team, but the full 1-5 scale needed to be used to identify the top and bottom performers. David thought this was a better way to identify the top performers in each team and 'weed out' consultants who weren't pulling their weight as much as others.

Following discussions with senior management about these ideas, the company introduced a modified performance management system and

a new flexible work policy in mid-2020 reflecting David's ideas. David believed this new system was a way to build in more 'individual accountability' for performance outcomes.

Under the new flexible working policy, staff were also encouraged to start working 'remotely' from their home for at least 3 days each week.

Three months after these new systems and policies were introduced, David sat down with Team Leaders to discuss how company performance was going. The feedback was disappointing (to say the least).

Despite David's desire to achieve some cost savings, morale was dropping from consultants frequently working remotely. Team Leaders have reported less staff engagement within their teams and an increased number of staff taking leave. Some consultants are consistently late to virtual team meetings; others aren't communicating with their Team Leaders in a timely manner. Internal consultant competition for clients and successful placements has changed the once positive culture in the company.

Team Leaders also have concerns about the forced ranking distribution system. Although confidential, in a small organisation, employees quickly learn the ratings of others in the company. This has resulted in envy of those employees ranked highly and reluctance to communicate with those deemed to be 'superstar' employees. Employees rated '3' feel their performance is being measured as 'average', so feel more demotivated. The employees rated 'average' also feel the appraisal system is too subjective, leading to lower levels of trust towards their Team Leader.

Team Leaders feel that the forced distribution of employees where leaders rank each employee from 1-5) creates too much ill feeling.

Some argue that their subordinates are all superior and therefore are unfairly disadvantaged if restrictions are imposed on the numbers who can receive a star rating.

Other Team Leaders object to rating employees a 1 or 2 just because they have to under the new policy.

David isn't keen on reverting to the 'old' ways of working under the previous CEO's leadership, but still sees some value in the new performance and working practices. Help is needed to refine the company's performance management practices and recommend solutions.

THE Task

1. As the HR Manager of Australian
2. Recruitment Firm, identify and analyse the problems at the company in relation to performance management.
3. Recommend two practical solutions for
4. Australian Recruitment Firm to help in refining and improving their performance management practices.

In answering both sections of this task, it is required to draw upon relevant performance management theories and concepts in identifying and analysing problems and recommending solutions. While you can utilise class readings, resources etc., you would ideally conduct your own research.