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MERALCO COMPANY PROFILE Based on 2009 Annual Report Since 1903, Meralco has powered the growth of the Philippines and its people. As the premier electric service distributor, it is an inseparable partner for progress. Consistently in the list of the Philippines' top five corporations and cited among Asia's finest, Meralco today serves the country's prime business districts and top corporations. The 9,337 sq. km. franchise area covers 31 cities and 80 municipalities including Metro Manila, the entire provinces of Bulacan, Rizal and Cavite; parts of the provinces of Laguna, Quezon, Batangas and Pampanga. Electrification level in the franchise is 98.7%. Meralco's service area, equivalent to only about 3% of the country's total land area, produces almost 46% of the gross domestic product (GDP), 33% from Metro Manila alone. The franchise area is home to 24.7 million people, roughly a quarter of the entire Philippine population of 92 million. With its newly-formed partnerships with San Miguel Corporation (Southeast Asia's largest food conglomerate) and Philippine Long Distance Telephone Company (the country's leading telecommunications provider), Meralco is now more equipped to try other businesses and introduce new innovations to better serve its customers.\ Career Oportunities Analyst Qualifications Graduate of any 4-year college course Good scholastic records Good in verbal and written communication skills Computer literate - knowledgeable in basic computer applications i.e., MS Office

Job Summary Performs data gathering; conducts regular review, evaluation, revision and formulation of policies, procedures, systems, programs and strategies; conducts relevant studies to recommend corrective measures to improve compliance to guidelines, policies and procedures. Engineers Qualifications Licensed engineer BSEE , BSECE, BS Civil Engineering Good scholastic records Good in verbal and written communication skills Computer literate knowledgeable in basic computer applications i.e MS Office Licensed Driver preferred but not required

Job Summary Performs operational/technical tasks and economic studies on assigned projects pertaining to existing and/or future power system development and expansion of distribution facilities of the Company.

Customer Representative Qualifications Graduate of any 4-year college course Good scholastic records Good in verbal and written communication skills Computer literate knowledgeable in basic computer applications i.e MS Office

Job Summary Handles customer's non-engineering inquiries, requests and complaints and processes non-project service applications. Face to face transactions with Meralco customers; working schedule is Monday to Friday, 8am to 5pm. Linemen Qualifications Male, 18 to 20 years old Must be at least 55 in height High School Graduate or preferably a graduate Technical/Vocational course in Electrical Technology, Practical Electricity or any allied courses Must have at least a student driver's permit

Job Summary Assists in constructing, troubleshooting, repairing and maintaining overhead and underground power lines and drives work vehicle to transport crew and materials to and from place of work.

The business case for forced ranking Forced ranking is the antidote to the problems of inflated rating and the failure to differentiate that many organizations have installed to help bring the truth into the performance management process. By implementing a forced ranking procedure, organizations guarantee that managers will differentiate talent. While conventional performance appraisal systems may allow managers to inflate ratings and award Superior ratings to all, a forced ranking system ensures that distribution requirements will be met. Assuming that the system is wisely constructed and effectively executed, a forced ranking system can provide information that conventional performance appraisal systems can't.

But just ensuring differentiation, while valuable in itself, isn't the whole reason companies have gone to using forced ranking systems. Creating a forced ranking system forces a company to articulate the criteria that are required for success in the organization. GE, for example, has identified its four Es: the set of criteria it uses to rank its managers and executives: high energy level, the ability to energize others around common goals, the edge to make tough yes/no decisions, and the ability to consistently execute and deliver on promises. These criteria were determined over a period of several years and were the result of serious deliberation. Other companies have settled on different criteria. Some have used nothing more than "Good results, good behavior." Whatever the criteria the organization decides on, the deliberations that senior managers engage in in determining these criteria help them to define and understand what they believe genuinely is important for success in the organization. The discussion of criteria often sparks significant, even boisterous, arguments about exactly what the measures and factors should be. There is value in this process even if no further action is taken. And simply knowing the criteria that senior executives use to assess talent increases the probability that organization members will alter their behavior in order to demonstrate more of the attributes that they now know will lead to success. By implementing a forced Another important business outcome that is often ranking procedure, unrecognized is forced ranking's ability to provide organizations guarantee that the organization with useful data on the ability of managers willdifferentiate managers to spot and champion talent. In one talent. company I worked with, one of its criteria for its forced ranking system was the ability to make tough decisions. In the course of briefing the senior executive team, I pointed out that one of the best sources of data would be the way that the vice presidents, their direct reports, went about making the forced ranking decisions during the sessions where they would all be together. Who is able to come up with telling examples of a subordinate's strengths and weaknesses? How well do various managers really understand the major strengths and development needs of their subordinates? A forced ranking procedure forces managers to think in far greater depth about the quality of talent in their unit than conventional performance appraisal systems typically require, and their ability to describe and verbalize their assessments provides a good indicator of a critical aspect of their leadership ability. Another important reason for proceeding with a forced ranking procedure flows from the frustrations surrounding the conventional performance appraisal systems in many organizations, since forced ranking can provide an independent verification of performance appraisal data. If there are significant variations in the talent data provided by the performance appraisal system and the data provided by the forced ranking process, that conflict is worth delving in to. In addition, forced ranking can provide something of great value that even the best performance appraisal systems can'taccurate cross-department comparisons. As larger groups are evaluated, and with criteria that can be applied equally across a variety of jobs, a forced ranking process may permit more accurate cross-department comparisons. The business environment today is making the rationale for developing forced ranking procedures more important than it has been for the past few years. After a several-year period of slower growth marked by major layoffs in several sectors of the economy, the "war for talent" seems to be heating up again. The impetus for identifying and actively acting to retain top talent is more important in an economy that now allows that top talent greater employment options than it has had for several years. Can forced ranking actually improve the quality of the workforce? Finally, the results of a major research project published in the First Quarter 2005 issue

of the academic journal Personnel Psychology appear to answer in the affirmative the question of whether a forced ranking process will actually improve the overall quality of a workforce. An objection that has always been raised to forced ranking is that one of its fundamental principles is flawedit is simply not possible to continually improve the overall potential of a workforce by systematically removing the bottom 10 percent every year and replacing them with better employees from the available applicant pool. Professor Steven E. Scullen and his colleagues constructed a complex and sophisticated mathematical simulation of a multicompany, multiyear forced ranking process that they labeled "FDRS." FDRS is their acronym for a forced ranking system that they referred to as a "forced distribution rating system." For clarity's sake, I will use the term forced ranking for their FDRS acronym in quoting from their study. In their model, one hundred companies of one hundred employees each over a thirtyyear period identified the bottom 10 percent of their workforce every year, fired them, and then replaced them with the best available candidates from the applicant pool. In their simulation they controlled for the impact of voluntary turnover, the quality of the applicant pool, and the validity and reliability of the ranking assessments that were made. The basic question they asked was this: "Is it reasonable to expect that an organization would be able to improve the performance potential of its workforce by firing the workers judged to be performing most poorly and replacing them with its most promising applicants? If so, how much gain might be expected, and how quickly might that gain be achieved?"1 Their answer: "Results suggest that a forced ranking system could lead to noticeable improvement in workforce potential, that most of the improvement should be expected to occur over the first several years, and that improvement is largely a function of the percentage of workers to be fired and the level of voluntary turnover."2 They did not mince words in stating that the basic hypothesis underlying the forced ranking, rankand-yank methodology is solid: "Results showed that a forced ranking system can improve workforce potential, in the sense that, on average, lower-potential workers can be identified and replaced by workers with higher potential."3 They discovered that firing more poor performers provided greater benefit to the organization than releasing a smaller number: "In each case, however, results for 10 percent fired were superior to those for 5 percent I find that most organizations fired."4 While they examined the relative are better served by importance of improving selection procedures implementing a forced ranking and enhancing the quality of applicant pools in system as a short-term increasing the overall effectiveness of the initiative. workforce, they discovered that the best results were produced by getting rid of poorer performers: "It is interesting, however, that firing poor (i.e., low-ranked) performers was the quickest route to improvement, and that reducing voluntary turnover soon became important as well."5 Many critics of forced ranking have acknowledged that while the procedure may in fact improve the overall quality of a company's workforce, it may do so at a steep price, producing adverse consequences in such areas as employee morale, teamwork and collaboration, the unwillingness of applicants to sign on with an employer who uses a forced ranking process, and shareholder perceptions. In their discussion of their findings, the researchers examined the possible effects of implementing a forced ranking procedure on all of these areas. They found that the potential problems were in every case balanced by equally compelling benefits. For example, while they

acknowledged that there could be a detrimental effect on morale if retained employees saw no compelling differences between employees who were terminated and those who were not, or if unjust treatment of coworkers was observed, they also noted, "It is not clear, however, that employees in general would see a forced ranking system in that negative light. In fact, many employees might applaud the organization's decision to eliminate underperformers."6 Concerning teamwork, they commented, "As with employee morale, however, it could be argued that the effects on teamwork and collaboration might actually be positive."7 Discussing the effects of installing a forced ranking system on the perceptions of the labor market, they noted that job seekers develop beliefs about an organization's culture while they are seeking employment. If an employment candidate becomes aware that an employer uses a forced ranking system and feels that the culture might therefore be too stressful or risky, the applicant might eliminate that company from consideration, causing the possible loss of some high-potential applicants. "It is certainly possible, however, that other high-quality applicants would see such a system as one where their contributions would be recognized and rewarded. These people would be eager to work in this type of environment. Thus, it is possible that a forced ranking system would improve the overall quality of an organization's applicant pools."8 Finally, they considered the impact on shareholder perceptions. While acknowledging that shareholders might have reservations about the company's use of a forced ranking system, because of potential lawsuits or other negative consequences, "investors might see the implementation of a forced ranking system as a clear signal that management is committed to accountability and to operating at an efficient staffing level. Perceptions of this sort should have a positive effect on stock prices."9 Finally, for many years I have argued that for most companies, forced ranking systems should be used for only a few years and then, once the obvious and immediate benefits have been achieved, replaced with other talent management initiatives. While some companies have been successful in using their forced ranking system for decades, I find that most organizations are better served by implementing a forced ranking system as a short-term initiative. Scullen and his fellow researchers confirm that advice. Early in their article they lay out clearly the basic problem of using forced ranking on an ongoing basis: "Despite the allure of having a continually improving workforce, we argue that each time a company improves its workforce by replacing an employee with a new hire, it becomes more difficult to do so again. That is, the better the workforce is, the more difficult it must be to hire applicants who are superior to the current employees who would be fired."10 Their mathematical simulation demonstrated that the greatest benefits came in the first 3.5 to 4.5 years after initiating a forced ranking system. They discovered that organizations got their best results immediately, in the first few years after implementing a forced ranking system: "The other outcome variable of interest is the rate at which workforce potential improved after the implementation of the forced ranking system. It is clear . . . that the bulk of the improvement in all scenarios was achieved during the first several years."11 Their summary: "Results suggest that a forced ranking system of the type we simulated could improve the performance potential of the typical organization's workforce and that the great majority of improvement should be expected to occur during the first several years."12

Errors to Avoid in Performance Evaluations

I. Halo/Horn Effect Halo/Horn error is the tendency to rate a person high on all performance factors or low on all of them because of a global impression one has. Causes: o Compatibility. This is the tendency to rate people whom we find pleasing of manner and personality higher than they deserve on all factors, not just interpersonal skills. Thos who agree with us, nod their heads when we talk, etc., get better ratings than their performance justifies. o The one-asset person. The glib talker, the person with the nice looks, the person with advanced degrees, or the graduate of our alma mater usually has the advantage of an upward bias when he or she is evaluated. o The high-potential effect. We often judge the persons credentials rather than what the person has actually done for the organization. o The contrary person. The boss may find it difficult to be objective and ignore his or her private irritations with a person who disagrees too often on too many things. Cures: o Attend to differences across performance factors. Develop a very clear idea of the nature of each performance factor and the kind of behavior it describes. Focus on differences, not similarities. o Attend to all aspects of a persons performance. When an individual is particularly impressive/disappointing in one area, avoid the tendency to categorize other performance areas similarly. II. Negative or Positive Leniency Some raters are too hard to too easy overall in evaluating employees. Performance evaluation ratings that are severe or lenient give the wrong impression to personnel and to the employee. Causes:

o Membership in a weak team. (Guilt by association) The good player on a weak team usually ends up with lower ratings than he or she would have if on a winning team. o The self-comparison effect. The person who doesnt do the job as we remember we did it when we held that job will suffer more than those those who do work unfamiliar to us. o The boss as perfectionist. Because the managers expectation level is so high, he or she is somewhat disappointed and rates people lower than they deserve. o The effect of the persons past record. The person who has done good work in the distant past is assumed to be okay in the recent past oo. The impressions of past good work carriers over into later periods. o The effective of recentness. The person who does an outstanding job the previous week or the day before the evaluation discussion can offset mediocre performance over the previous months. Cures: o Develop an accurate understanding of the type of performance that presents each rating level. o Calibrate your internal rating scale with a trusted colleague. Errors to Avoid in Performance Evaluations III. Central Tendency Some raters evaluate all employees in the middle of the scale and avoid extreme ratings. Causes: o The no complaint bias. The appraiser is often apt to treat no new as good performance. If the appraiser has had no complaints either from or about the person, she or he assumes everything is fine, and evaluates the person as such. o Lack of clearly defined performance standards. The rater may assume that all employees are performing about average because she or he isnt really sure what constitutes exceptional performance.

o Avoiding risks. Sometimes raters worry about consequences for giving employees high or low ratings. They are concerned about challenges by the employee, or a need to give more detail as reasons for lower ratings. Cures: o As with other rating errors, central tendency can be counteracted by developing very specific clearly defined objectives. o Some evaluation structures literally force raters to spread out their ratings across the entire scale. If you commit central tendency error, try pushing yourself to vary your ratings within and across persons. IV. Available Information Effect Information that is readily available in memory will over influence ratings during performance evaluations. Causes: o Certain incidents can fortuitously trigger memories of a particularly good or bad performance by one or more employees. If this happens shortly before the performance evaluation, it could affect your ratings of that employee. Cures: o Before the evaluation, gather as much information as you can about all pertinent areas of performance. o Maintain a performance event file for each employee. Keep records of successes as well as failures. Dont overlook satisfactory performance. V. Direct Experience Effect Direct experience can dominate abstract information even if the abstract information has greater accuracy than the personal experience. Causes: o If you were to see an employee slam down the phone and you knew she or he was

speaking to a client, this probably would affect your opinion of the employee vis--vis the customer service performance factor. However, before you assign the employee a low rating, it is wise to collect information from other sources. You may find that this behavior is typical of the employee, or you may learn it is extremely rare. Cures: o Dont let a single experience determine your opinion of an employees performance. Gather as much information as possible and try not to weigh one incident too heavily.