Haier Performance management Essay

1.What are the specific practices of Haiers performance commission agreement of rules? What are the point principles place those practices?Haier, being the worlds one-sixth largest maker of large kitchen appliances, had 4% global market share and sanitary positions in the production of washing machine and refrigerators. The key success behind was Zhang, the CEO who brought the telephoner fortunes. Several innovative human resource management practices were introduced. First, on that point was a set of sloped remainss on factory floor. each employee who has non performed well has to stand up on the yellow footprint and tell the employee why they have not performed well and how they leave alone ameliorate their performance. The employee who has performed best has to stand up on the red foot and excuse why he had through a good occupation. One more than(prenominal) tool utilize by the companion to measure the performance of the employees on daily basis was to discuss with their supervisor and set clear goals of the employees forwards beginning of their shift. At the end of the day, they met over again for assessment. Then, the employee would receive a colored take care in a board showing an informal track for the day. For managers, their performances were reviewed weekly and the results were openly displayed at the cafeteria. Another tool used by Haier was the performance appraisal system the summit 10% were promoted and get across 10% were sent back to the grooming at the expense of the family. After this training if they again come under the bottom 10% then they were again given leave and this time they went to training further on their feature expense.In the third review if they again come in to the bottom 10% then they were fired. Moreover, all the employees were treated as separate company and they have their different accounts and profit and loss statement. If the employees exceeded their goals then they increase nest egg in the ir accounts and when they did not reach their goals then they have debt on their account. This system was mainly designed to increase employee motivation to perform better than the standards defined. genius pool was generated for any new opening in the company so that the best employee gets the new position. Job rotation was prevalent in the company and any employee was tested at different positions before assigning a final job. Evaluation was done by points system and any employee could be transferred out of the talent on not getting the points for minimum standards. The guiding principles behind those practices wereOEC (Overall, Every, Control and Clearance), 8020 principle and Racetrack Model. Thats mean, all performance dimensions of everyone everyday had to be considered and there were self-assessments and meets with supervisors.Also, Haier have their make 8020 principle in which the 20% of the employees who were managers are answerable for the other 80% of the employees. I f the employees did not perform according to the standards then their supervisors were nonresistant for the results. Last but not least, under racetrack, the excellent employees had to keep pelt a unyielding and improving, creating a maven of competition.2.why does Haiers performance management system practice? What are the potential pitfalls of Haiers system?Haiers management was workplace and has been well received by workers as this could be reflected by the companys success in the past 2 decades. With the new HR practices, the workers were given opportunities to display their motivation, innovative and competitive attitudes and capabilities of such kinds under Haiers management. Also, all practices were carried put under great transparency, fairness and justice. Importance of face was a characteristic of Chinese cultural tradition. With the daily assessment and ranking, the sense of competition instantly increases. The results of the evaluation of workers were shown with ind ividual names. It seemed that workers or managers of poor results would omit their faces. So the workers were motivated to do better.The performance appraisal system the top 10% were promoted and bottom 10% were sent back to the training provided chances for the employee to correct and offer training before really fire them. This was considerate and lenient. Also, the meeting with supervisors made the expectations and standards of works crystal clear.They set up, achieve and were accountable for the targets. Their performances were about monitored, evaluated and rewarded and thats why they were motivated. Moreover, under the 8020 principle, the mangers had to have the courage and conscientiousness to assume responsibility at Haier. Thus, they had to be more dedicate and care more, leading to great effort and productivity for both the managers and workers. However, Haiers management is in contrast to the old management of socialism. So there are maybe some potential pitfalls. F ace and human congress are the two deep-rooted traditional Chinese concepts. If the Chinese employee drive outnot birth or adapt to the new practices, it arouse resentment among the employees. In long run, working under keen competitionmay impose voiceless burden to the employees, leading to stress and mental problems. A disadvantage in the footprint order is that it did not give any ranking to the employees so it would be difficult for decisions related to appraisals and salary increments. Sometimes, it might embarrass the employee as well. Haier ranked top 10% and bottom 10% of the employees. This could be morale.The superior challenge of this method is to differentiate between other 80% of the employees and this method may be biased by the recent performance of the employees.3.If Haier expands into the U.S., will its performance management system be effective in the U.S.? Why or why not?If there is any change you would alike(p) to make, what would it be? It may not be that effective in the U.S. The U.S. tillage is different from Chinese. They have low power distance and privacy is an outstanding issue. The U.S. employees may feel being insulted if their performances are publicized, i.e. the colored footprint may not work. Also, there is higher level of performance orientation in U.S., emphasis is not put on daily performance but final result. They also enjoyed individualism and freedom so they may not like being instructed or guided too much by the supervisor every day so grievances will appear. To be more effective and acceptable, company can adopt different methods. One of them can be Graphic Rating Scale method which is the simplest and most democratic method for the performance appraisal. In this method the employees are ranked on different scales such as communication, team work and skills related to their job profile. To eliminate the bias in the appraisal different types of methods should be used and employees should be rated by different in dividuals. Rating can be done by their supervisor, peers and subordinates. Self-rating method can also be used.