PERFORMANCE MANAGEMENT (HRM3706)
ASSIGNMENT 2
SEMESTER 2
UNIQUE NUMBER 873581
DUE DATE: 21 SEPTEMBER 2018
, Read the following case study and answer the sub-questions that follow:
PERFORMANCE MANAGEMENT SYSTEM IN ACTION AT ABC BANK
ABC Bank is a small bank that offers financial services. They specialise in life insurance, fixed annuities, car insurance
and business insurance. They make use of a company calendar that includes key company deadlines, holidays and
other important information. Employees are expected to use the company calendar for their day-to-day operations to
ensure that their duties are aligned with the company values, plans and goals. Right at the top of the calendar are the
following statements: “We want to be known as the leading bank in Gauteng’’ AND “Our mission is to make a difference
in the lives of our employees and customers by meeting their financial needs’’. The calendar assists the bank in
reinforcing their mission and vision. Employees also get a clearer understanding of what their daily tasks contribute to
the goals of the organisation as a whole.
John Mazibuko has just been appointed as a sales consultant for the bank. He signed a performance agreement contract
stating that he is expected to sell life insurance to the value of R20 000 quarterly. He regularly checks his employment
contract, which has a list of his tasks and duties (job description). John was also made aware that performance is
reviewed on a quarterly basis, and each individual receives feedback immediately. According to the performance
management system of this bank, individuals who do not meet their performance targets are dismissed with immediate
effect. Those who exceed the set target of R20 000 quarterly, receive 5% of the excess sales.
John is not happy with the set performance target. From his experience with sales jobs, he feels that the target is set
way too high, especially considering the current economic conditions in this country. He tries to find out from other
colleagues whether they have ever managed to exceed or achieve this target. He is shocked to hear that none of them
has ever received any incentive. Most of those who could not meet the target and got dismissed apparently struggled
to reach even 50% of this target! This has been happening for three years, with no effort from management to correct
it. John is planning to meet with the manager with a suggestion to remedy the problem.
QUESTION 1
1.1 Identify t h e t y p e o f i n c e n t i v e s o r r e w a r d s o f f e r e d t o t h e s a l e s c o n s u l t a n t s a t A B C
B a n k . Substantiate your answer. (4)
ANSWER
Refer to section 4, chapter 10, in the prescribed book.
The type of incentive offered to sales consultants at ABC Bank is sales commission. When sales commission is used,
employees are paid based on a percentage of sales.
ABC Bank offers employees 5 per cent (%) of sales that exceed a target of 20 000.
1.2 Which of the THREE stages of the performance management process are present in the case study?
Substantiate your answer. (12)
ANSWER
Refer to pages 38 and 46, chapter 2, in the prescribed book.
The stages of the performance management process that are applicable are the prerequisite performance planning
stage. and the performance review stage. The prerequisite stage entails knowledge of the organisation’s mission and
strategic goals. ABC Bank makes use of a company calendar in which the mission, vision and goals of the company as
ASSIGNMENT 2
SEMESTER 2
UNIQUE NUMBER 873581
DUE DATE: 21 SEPTEMBER 2018
, Read the following case study and answer the sub-questions that follow:
PERFORMANCE MANAGEMENT SYSTEM IN ACTION AT ABC BANK
ABC Bank is a small bank that offers financial services. They specialise in life insurance, fixed annuities, car insurance
and business insurance. They make use of a company calendar that includes key company deadlines, holidays and
other important information. Employees are expected to use the company calendar for their day-to-day operations to
ensure that their duties are aligned with the company values, plans and goals. Right at the top of the calendar are the
following statements: “We want to be known as the leading bank in Gauteng’’ AND “Our mission is to make a difference
in the lives of our employees and customers by meeting their financial needs’’. The calendar assists the bank in
reinforcing their mission and vision. Employees also get a clearer understanding of what their daily tasks contribute to
the goals of the organisation as a whole.
John Mazibuko has just been appointed as a sales consultant for the bank. He signed a performance agreement contract
stating that he is expected to sell life insurance to the value of R20 000 quarterly. He regularly checks his employment
contract, which has a list of his tasks and duties (job description). John was also made aware that performance is
reviewed on a quarterly basis, and each individual receives feedback immediately. According to the performance
management system of this bank, individuals who do not meet their performance targets are dismissed with immediate
effect. Those who exceed the set target of R20 000 quarterly, receive 5% of the excess sales.
John is not happy with the set performance target. From his experience with sales jobs, he feels that the target is set
way too high, especially considering the current economic conditions in this country. He tries to find out from other
colleagues whether they have ever managed to exceed or achieve this target. He is shocked to hear that none of them
has ever received any incentive. Most of those who could not meet the target and got dismissed apparently struggled
to reach even 50% of this target! This has been happening for three years, with no effort from management to correct
it. John is planning to meet with the manager with a suggestion to remedy the problem.
QUESTION 1
1.1 Identify t h e t y p e o f i n c e n t i v e s o r r e w a r d s o f f e r e d t o t h e s a l e s c o n s u l t a n t s a t A B C
B a n k . Substantiate your answer. (4)
ANSWER
Refer to section 4, chapter 10, in the prescribed book.
The type of incentive offered to sales consultants at ABC Bank is sales commission. When sales commission is used,
employees are paid based on a percentage of sales.
ABC Bank offers employees 5 per cent (%) of sales that exceed a target of 20 000.
1.2 Which of the THREE stages of the performance management process are present in the case study?
Substantiate your answer. (12)
ANSWER
Refer to pages 38 and 46, chapter 2, in the prescribed book.
The stages of the performance management process that are applicable are the prerequisite performance planning
stage. and the performance review stage. The prerequisite stage entails knowledge of the organisation’s mission and
strategic goals. ABC Bank makes use of a company calendar in which the mission, vision and goals of the company as
