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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.

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3.6a 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. 3.6ai 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. 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). ...read more.


Therefore it is essential that Tesco only recruit employees who will benefit the company and gain the potential to further their career, a failure to detect weaker employees will result in a loss for Tesco's through training and development and will have an immediate affect upon the efficiency and profitability of the workforce. Therefore it is essential that Tesco's manage to obtain and maintain a successful, yet flexible workforce via a successful Recruitment and Selection procedure in order to improve profitability and remain the UK's leading retailer. 3.6bv Porter and Lawler's Expectancy Model Porter and Lawler's model (located below) includes variables and highlights certain potential managerial implications. In particular it sheds light upon the nature of the relationship between employee satisfaction and performance. At the beginning of the motivational cycle this model suggests, as in basic expectancy theory, that effort is a function of the perceived value of potential rewards (valence) and the likelihood of achieving that reward (expectancy). Porter and Lawler's model then adds to existing theory by suggesting that performance is a product not only of effort but also of the individual's abilities and characteristics together with his or her role perceptions. Performance leads to two types of reward. Intrinsic rewards are intangible and include a sense of achievement, or advancement, of recognition and enhanced responsibility, whereas extrinsic rewards are more tangible and include pay and working conditions. Tesco's use a combination of both intrinsic and extrinsic methods of motivation in order to enhance and improve their workforce. Tesco use intrinsic method of motivation for hierarchy employees such as departmental managers or assistant managers. When a departmental or assistant manager receives recognition they receive it in the form of a promotion, which gives them a sense of achievement, responsibility and increased pay. Tesco use extrinsic rewards for a vast majority of employees in order to motivate them and gain as a high level of output possible. ...read more.


No exclusions are made on the grounds of region; size of company or type of industrial sector and employees cannot be excluded because of their hours, employment patterns, and length of service or contract status. In April 2000, there were three bands for the minimum wage: A rate of 3.60 per hour for those aged 22 and over. A rate of �3.00 per hour for those aged 18-21 (inclusive). A rate of �3.20 per hour for those who are 22, and are within the first six months of a new job and taking part in accredited training. Some people are not entitled to the minimum wage. These include: The self-employed. Voluntary workers who are only paid expenses. People younger than 18 years old. People who normally work outside the UK. The armed forces. Prisoners. People on voluntary work experience. People living in their employer's home. Members of an employee's family. The implications of ignoring the minimum wage legislation are severe. Tesco can face a fine of up to �5,000 and criminal prosecution. The minimum wage can distort the market for labour, especially if it is higher than the real market rate for particular jobs. Opponents of the initiative have argued that it may reduce employment opportunities and lead to higher costs, which will be passed on to the consumer in the form of higher prices. Tesco being the UK's leading retailer it is essential for them that the minimum wage does not increase any further otherwise it could cause the need for making employees redundant. Therefore in order for Tesco's to remain the UK's leading retailer they must maintain a successful and flexible workforce, however escalating wage demands can only hinder the progression of smaller organisations as many other organisations will not have the financial support that Tesco occupy. Therefore as consumers escalating wage demands may end all competition for Tesco's and allow them to set high prices, thus resulting in greater levels of output and profitability. Taranjeet Sandhu ...read more.

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