Performance Management at Process Engineering
Process Engineering is a private Romanian company offering technologies and services dedicated to fluids filtration, separation, purification and water treatment. Its customers come from various industries like pharmaceuticals, food and drinks, oil processing, chemicals, power generation, water treatment.
The decision to undertake this project in March 2011 was supported by two factors. Based on a previous collaboration with PE on the topic of organizational culture and given its development stage, Dan Humelnicu made the case of providing greater importance, attention, resources and effort to organizational development in a number of areas including performance management. In addition to that, the PE general manager himself felt the need to clarify internally what performance is, how it is defined, measured and rewarded.
The project was structured in three stages:
- defining performance;
- rewarding performance;
- evaluating performance.
The first stage started with a training session, “Objectives At Work” that laid the foundation for the definition of objectives, key performance indicators and the entire measurement and reporting system. The Balanced Scorecard (BSC) approach was introduced and explained during the course and in this way all members of the team had the opportunity to understand the foundation of the future management system to be introduced in the company.
The next step was the definition of objectives and performance indicators in all four dimensions of the BSC: financial, customer, internal processes, learning and growth. This was initially done by the team members of the various departments and was updated with the help of our consultant. An important activity was the work performed jointly by the general manager and the consultant in order to structure, refine and finalize the dashboards for all levels: positions, departments and company.
A rewarding mechanism was developed in the second stage. First we established levels of performance and corresponding levels of compensation. Then we looked at payroll surveys to understand what were the compensation and benefits levels for certain positions. In this way a final decision was possible as regards the rewarding mechanism, the salary levels and the earning opportunities.
A 2-day workshop was organized at the end of this stage (October 2001). The objective was to present, to explain and to discuss with all team members the results of the two stages. At this point we realized that he implementation of the system depended on the availability of information since new data, that was not previously available, was required in order to calculate many performance indicators.
The decision was to launch a new project that consisted in the implementation of a superior ERP (Enterprise Resource Planning) system and of a new CRM (Customer Relationship Management) system capable to support new processes and new information delivery needs. Consequently the third stage of the project was postponed until the new systems will be in place and the team members will have some experience of working with the newly defined objectives and performance measures.
For PE the project was a very good experience of building the infrastructure of the company in terms of systems, processes, practices and information to support the activities of the organization and finally its business strategy.