Free Performance Management System Implementation At Cathay Pacific Airlines Report Example
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This paper presents a research study on Cathay Pacific Airways, which is a Hong Kong based global airline founded in 1946 and now currently a major part of Cathay Pacific group that also manages Air Hong Kong and Dragon Air. The organization employs around 20,000 employees in Hong Kong with passenger and cargo coverage to more than 100 destinations; therefore, it is vital to study performance management system at Cathay Pacific Airways.
Today, the global corporations specifically focus on implementing a strong performance management system to evaluate employee behaviors, dedication and commitment to organization and its defined goals & objectives. The purpose of performance management system is to measure employee performance and net contribution in organizational growth. The findings from system implementation could be used for strategic planning, which then leads to growth at operational and business levels. Finally, the significance of performance management also becomes evident as it contributes in several disciplines such as organizational restructuring, balance, modernization, replacement, organizational learning, experimentation and total quality management.
Key Research Question, Objectives and Aims
How Cathay Pacific’s performance management system positively impacts individual performance and contributes towards attainment of business level goals?
Brudan (2010) emphasizes that performance management is a process that facilitates strategic planners and HR partners to define, monitor, measure and control organizational strategies, sub-systems and functions for accomplishment of organizational targets and objectives. Business organizations exist for a purpose i.e. profit maximization, which is accomplished only through desired ‘performance’. It should be stressed that individual performance is a sub set of organizational performance. Also, the performance measurement is also a sub-part of a comprehensive performance management system, which comprises of organizational strategic planning, formulation of performance goals, individual assignments and targets, employee trainings and development exercises, evaluation tools and annual performance reviews.
De Waal (2003, p. 688) reveals that performance systems provides both “financial and non-financial information that influence decision-making and managerial action”. The most important aspect of performance management is to accurately demonstrate human activity and consider employee behavioral issues during implementation. A performance system is effectively implemented when it offers flexible solutions to employee about strategic adjustments coupled with problem-solving and decision-making instead of a top-down approach. Another important element is consideration of task and general environmental factors on the development and implementation of performance systems. For example, the employees strive to deliver their optimum performance; however, the external environment is not favorable due to recession, liquidity issues, political turmoil, deflationary trend and other reasons. Obviously, the organization may not be able to achieve its desired goals; however, it’s performance measurement system must not blame employee in such destructive external environment for weak organizational achievements as it is beyond workers’ influence and control.
An important tool in performance measurement systems is known as Benchmarking in which the HR experts review industry performance trends and set thresholds for individuals in their respective enterprises. Unlike past businesses that used to focus traditionally on individual performances only, the contemporary organizations amalgamate individual and operational performance systems to align with strategic management process for accomplishment of business objectives. Hence, the performance management system at a 21st century enterprise is tied with strategic management and subject to changes and modifications whenever a corporate vision and mission is revised (De Waal, 2003); (Bourne, 2008).
Bourne (2008) highlights that modern organizations have now replaced balance scorecards with corporate-level scorecard to review organizational strategies, performance indicators, employee participations and contributions in performance improvement. For instance, the performance measurement could lead to performance enhancement only when the core actions for improvement are aligned with measurement tools and strategic agenda. Also, the HR strategic partners should develop a consistent roadmap for desired expectations by ensuring employee collaboration, communication and group work. An organization with extensive focus on leadership will achieve substantial performance management goals and improvements. Unequivocally, the leaders are a real force that develops a motivated and devoted workforce, which understands its importance in organizational recognition and image building, thus they contribute in delivering their optimal individual performance to surpass customer expectations (Steers, Mowday & Shapiro, 2004). Bourne (2008) also emphasizes a major argument that employee ownership and direction is essential for performance management as workers who develops an ownership value about their respective organization are found to be highly satisfied, committed, loyal and engaged in improving corporate strategies, mechanisms and delivery systems. In addition, these workers also prepare organizations to grapple with future changes, challenges and impediments, thereby making companies significantly proactive with dynamic systems and change processes.
The researcher has used secondary research method to analyze published scholarly articles and journals about performance management and measurement systems. For this purpose, the contributions of De Waal (2003), Bourne (2008) and Brudan (2010) have been used to prepare literature review to define performance systems and evaluate theoretical models / frameworks for system development and implementation. Hence, this is a literature-based research that will analyze data using induction and deduction analytical tools. The information about Cathay Pacific has been obtained from press releases, company statements and reports available at airline’s official website (www.cathaypacific.com). The specific information about Cathay’s performance management system has been analyzed using Howard (2006) comprehensive case study.
According to Howard (2006), Cathay Pacific provides both passenger and cargo services to more than 100 destinations worldwide. Besides, the company is highly committed to deliver top notch travel services to its clients by adopting core values of timeliness, accuracy, authenticity, safety, superior financial returns and environment sustainability. The global airline follows its famous motto “Service Straight from the Heart.” Howard (2006) also reveals that maintaining superior service quality is essential for Cathay Pacific because its core business comes from retained loyal customers who wish to reuse airline’s services.
Cathay Pacific’s new performance management system positively impacts individual performance by allowing employees ample empowerment, flexibility and choice in decision-making and problem-solving. The company opts to increase employee collaboration and coordination at national, regional and international level so that diverse employees could engage into meaningful and prolific conversations with counterparts and managers at various international destinations. The purpose is to create a bridge between employees based in Hong Kong and across globe for service accuracy and performance improvement in both passenger and cargo service segments. In other words, Cathay’s employees are entitled to make functional strategies and decisions on their own for service enhancement and business level goals. Moreover, the company addresses the need for diversity by making performance systems fairly customized to permit employees about choosing the right evaluators in different situations and roles. Cathay has divided performance management into four core steps of which first and second are to get employee consensus and conduct performance evaluations. Third stage is about highlighting “what is better” for performance betterment, customer retention and organizational growth. Fourth is to develop an action plan for new system design, implementation and review post-implementation performance. Also, the company presently provides extensive trainings, coaching, development, mentoring and academic education (Howard, 2006).
Discussion and Conclusions
The previous performance management system at the airline was significantly standardized, which is obviously not viable to deliver the correct evaluations about diverse employees at diverse global destinations with differing management styles. Hence, Cathay needs an extensive but flexible HR performance system that would specifically focus on service competencies, employee behaviors, job morale and commitment to deliver, which could be implemented across the globe to assess employee performance at strategic, middle and lower management levels. Finally, Cathay focuses extensively on cultural learning of its employees, which is mandatory for establishing a global customer base and implementing employee management systems and change initiatives.
The research would now like to provide a major suggestion to the management of the Cathay Pacific Airways to improve their PM systems as well as their organizational efficiency and effectiveness. First, the airline should specifically focus on implementing a customized PM system for operations staff, cabin crew and ground crew who are although first-line and middle-management employees but they play extremely critical role in repair and maintenance, cargo loading, timeliness and overall service improvements. Hence, the motivation and performance of these individuals would be a real difference in Cathay’s business-level performance in comparison to other employees.
Bourne, M. (2008). Performance measurement: learning from the past and projecting the future. Measuring Business Excellence, Vol. 12, No. 4, pp. 67-72 [Accessed – December 25, 2014]
Brudan, A. (2010). Rediscovering performance management: systems, learning and integration. Measuring Business Excellence, Vol. 14 No. 1, pp. 109-123 [Accessed – December 27, 2014]
De Waal, A. A. (2003). Behavioral factors important for successful implementation and use of performance management systems. Management Decisions, 41(8), pp. 688-697 [Accessed – December 29, 2014]
Howard, C. (2006). Cathay Pacific Airways Tracks Employee Behavior to Improve Performance. Bersin & Associates, pp. 4-19 [Accessed – December 30, 2014]
Steers, R., Mowday, R. and Shapiro, D. (2004). The Future of Work Motivation Theory. Academy of Management Review, Vol. 29, No. 3, 379–387 [Accessed – December 27, 2014]
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