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Introduction

Pakistan International Airlines is one the biggest

airline in Pakistan having both National and International transportation routes across the world.
PIA has been as air travel pioneer since its inception in

1955.
PIA being a national carrier, and a publicly owned

organization, has a culture geared towards maintaining linkages for the country, creating employment for the public and presenting national image to the outside world.

Problem Identification
At PIA, since last one decade management has

changed the performance management system thrice. Firstly they had ACR system, then Forced Distribution Ratting System (FDRS) also known as Bell Curve System. Than again is on cross roads to restore the ACR system.
We have focused on the reasons for the failure of

Forced Distribution Ratting System (FDRS)

PERFORMANCE MANAGEMENT SYSTEM


Effective performance management systems require employees and

supervisors to work together to set performance expectations, review results, assess organizational and individuals needs and plan for the future.
Feedback

Motivation

Setting Objectives

Performance Appraisal
Identify Training Needs

Standardize Performance

Career Development

KEY FEATURES OF PERFORMANCE MANAGEMENT SYSTEM (PMS)


Section Job Review Part A (Objectives) Explanation To be filled by appraisee at the end of review period This part shall be filled by incumbent in consultation of reporting officer and superior

reporting officer at the start of review period. Part A carries weightage of 70% for non
customer focused areas and 30% weightage for customer focused areas.

Part B1 (Skills and Abilities)

This part is meant for employees working in customer focused areas. This part carries 70% weightage in computation of the final score for all the employees.

Part B1 (Skills and Abilities)

This part meant employees working in non customer focused areas . this carries 30% weightage in computation of final score for all the relevant employees.

Part C (Assessment & Ranking)

This part consolidates the data/assessments written in pervious sections. It consist of seven sub parts. here employees is ranked and his/her comments are recorded.

Level of Performance and Evaluation


Level
Level-1

Rating
Outstanding

Abbreviation Scale
OS 5% T0p

Measure
Performance far exceeds the performance standards i-e excel in all scales of the work

Score
4.6-5.0

Level-II

Very Good

VG

20% Remaining Performance frequently exceeds the Top performance standards i-e excel in some important scales of the work and meet all other aspects.

3.6-4.5

Level-III

Good

GD

50% Remaining Performance consistently meets all the


Top standards of the work.

2.6-3.5

Level-IV

Needs Improvement

NI

20% Remaining Performance doesnt meet performance Top standards in some important aspects of the work.

1.6-2.5

Level-V

Inadequate performance

IP

5% Last Remaining

Performance is well below the standards 1.0-1.5 of the work.

Forced Distribution Ranking System (FDRS)

Forced Distribution Ranking System (FDRS)


Forced ranking is a controversial workforce management tool that uses intense yearly evaluations to identify a company's best and worst performing employees. Managers rank workers into three categories: The top 20 percent are the "A" players, the people who will lead the future of the company. They're given raises, stock options, and training.
The middle 70 percent are the "B" players, steady-eddies who are given

smaller raises and encouraged to improve.

The bottom 10 percent are the "C" players, who contribute the least and

may be meeting expectations but are simply "good" on a team of "greats." They're given no raises or bonuses and are either offered training, asked if they'd be happier elsewhere, or fired.

Forced Distribution Ranking System (FDRS)

Forced ranking systems direct managers to evaluate their

employees' performance against other employees, rather than the more common (and often grade inflated) measure of evaluating performance against pre-determined standards. The result of such a process is often brutally blunt.
Forced ranking is also used by General Electric, Cisco Systems,

EDS, Hewlett Packard, Microsoft, PepsiCo, Caterpillar, and Sun Microsystems, to name only a few well-known employers.

FDRS System at PIA


Grading employees as under:
4.6-5.0
3.6-4.5 2.6-3.5 1.6-2.5 1.0-1.5

Outstanding or Exceptional Performance Very Good Performance Good Performance Needs Improvement Inadequate Performance

Failure of FDRS at PIA


Cultural Aspects
The organization is highly people oriented. Along with

giving competitive salaries, PIA takes care of its employees by providing lots of benefits like medical, passage, pension and gratuity etc. Most importantly, people feel very secure about their jobs which make them complacent. This is one of the reasons why FDRS failed at PIA. activities cannot be described as either team or individual based. People do work in teams but the sense of competition and achievement is lacking. This may be because team based reward system is absent and even if one person is capable enough to raise teams performance.

Since no job analysis is ever done in the organization, work

Failure of FDRS at PIA


Biases A low performing department may have employees in the top 5% category and thus would still be eligible for reward. This practice overlooks the need for improvement and nurturing the best people.
The goals are not set high enough, then

almost anybody can get a superior rating.

Failure of FDRS at PIA


Political Involvement
Being a government organization, there is strong

political involvement is still the part PIA and also corruption is playing positive role. Many of political parties have their staff unions in PIA and all have their own vested interest.
Such political involvement will never support a

performance evaluation system like FDRS.

Failure of FDRS at PIA


Appraisers Attitude Performance grading which is done as per Behaviorally Anchored Ranking Scale (BARS) at PIA is not normally taken very seriously by some departments.
At PIA, appraisal forms are generally filled

without careful planning and in a hurry (just to get rid of this excess burden).

Failure of FDRS at PIA


Lack of Knowledge

The appraisers and appraise is totally lacking knowledge regarding the benefits of FDRS system and there ratings disrupts the bell curve.

Failure of FDRS at PIA


Subjectivity The appraisal form used by the organization is highly subjective and performance grading depends heavily on reporting officers whims and repartees relationship with his / her boss.
A forced ranking system often incorporates the

subjectivity of department heads, which can Institutionalize bias and devalue older workers. Interestingly

Failure of FDRS at PIA


Inflated Rates Managers dont want to give bad news to their people. This might result in inflated ratings and may distort the shape of the bell curve.
The essence of FDRS is sacrificed if managers are given

autonomy to change the shape of the bell curve. This is exactly what is being practiced at PIA and instead of keeping employees motivated, has resulted in aggravating the situation as PIA employees give much consideration to comparing themselves with each other

Failure of FDRS at PIA


Inadequate Pay Grade wise Comparison FDRS requires that for comparison there should be a homogeneous group of adequate number of people. At PIA, even within one department, people of similar pay grades are doing completely different jobs and their cross comparison is irrelevant.
In some departments, there may not be enough

number of people to compare against each other. In this case, if these employees are compared over and above their department level, their good performance may show up as inadequate and causes de-motivation

Recommendations
Revisit the Key Performance Indicators. Separate complaint management cell be established

handled by a separate team. The monthly report of each department will be circulated and also the on backend have complete details along with particular employee details. This cell shall also circulate the hard hitters across the board in order to motivate them. The same must be included in annual appraisal.

Recommendations
The personal and professional factors in appraisal form

must be evaluated separately. The 50% of the professional score includes from Competency level. The complaints during the year must be the part of appraisal system.

Re shuffling of employees. The placement of right person

at right place according to their designation and pay scale. This will suffice the purpose of comparison

Incase if any have reservations against the annual appraisal,

he/she can consult with HR department where this must be headed by head of Human Resources training and development

The annual appraisal form must include the need for

Recommendations
In order to avoid the same pay level problems, the employees

with pay scale from Group I to V rate more than the Group VI to V. Mean strong evaluations required for higher level employees.

The final ratings must also be compared with the overall

performance of the department. The complaints must be the part of annual appraisals
The bell curve must be for management employees.

Management shall try to reduce the political involvement. The extensive training programs shall be arranged order to

facilitate employees to participate in annual appraisal to implement bell curve system successfully.

Recommendations
PIA management shall revisit the ratting structure. Below is the

proposed ratting structure. 4.6-5.0 Outstanding or Exceptional Performance 3.6-4.5 Very Good Performance 3.1-3.5 Good Performance 2.1-3.0 Average Performance (Needs Improvement) 1.0-2.0 Poor Performance
Good performance and above in following manner: Good Performance One Basic Salary Very Good performance Two Basic Salaries Outstanding Performance Three Basic Salaries

The bonuses shall be awarded to employees comes under the

Recommendations
We recommended basic salaries because PIA management is already

giving lots of benefits to their employees in terms of tickets as well as other facilities.

outstanding performers as per PIA current practice shall be posted on

higher level upon availability they may also be posted in PIAs foreign office based on the job requirements.

The promotions shall also based on the ratings. PIA management shall

also introduce promotion approval committee with each member from every department (Departmental Head), GM Human Resource, Head of Performance Management Evaluation Cell, Head of Complaint Management Cell, a judge of high court (As in all government entities), Government representative, it could be the Defense Minister or his/her nominee (As it comes under ministry of Defense) and Managing Director PIA. The MD PIA shall head the committee.

. .

Recommendations
PIA management shall separately introduce the

department for performance management system and evaluations under the direct report of General Manager Human Resource, Managing Director PIA.
Apart from annual evaluations, midyear reviews shall

be introduced that create the habit among employees to understand the advantages of evaluation system ad also know the proper way of ratting.

T HANK YOU

FOR YOUR ATTENTION

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