Introduction
The Gentleman’s “Three” is a fictionalized business case study that reflects a performance appraisal system at Arrow electronics company. It is based at Circale Corporation. The VP in charge of human resources, Nils Ekdahl was tasked with the CEO’s directive of $20 million reduction from the payroll within four months. This directive was made after Circale Corporation made two new acquisitions though consultations with the former VP, Michael Milanese. After the new acquisitions were secured, there was an unsuccessful action of replication of the activities and systems from department to department in the company. Opposed to the duplication process, Anita Fierst – the CFO thought differently. She believed that after the acquisitions, the company should have begun with cooperation of departments to achieve combined productivity. She thought that numbers were the most important in the company as long as cooperation among the employees was encouraged and put in place. Ekdahl’s view was that the company was to not only emphasize on the numbers but to have to fit people to their right positions. Ekdahl had to carry on and therefore put into operation a new performance appraisal system. The new system was Michael Milanese’s idea to be put in place from location to location of all the six worldwide locations of Circale Corporation. He was the immediate predecessor of Elkdahl in the position of the VP in the human resources department. The system was structured to make certain the after-merger decision to reduce the payroll of the employees. Its main objective was to fit the right and best personnel in each position. The VP embraced the system by coming up with a non complicated form that required managers to complete and evaluate employees on a five point basis. The managers did the evaluation and when they presented their results, every employee’s rating was above average based on the 1-5 rating base. The results bothered Ekdahl whose expectations were not met; at least some employees would have landed on 2 or 3 points and even 1. He called up a meeting and ordered the managers to conduct another performance review reflecting his expectation. After the second appraisal the results showed that most employees had three points with a few 2 points. This again was not impressing to the VP. It was only doctored to meet his expectations. The first performance was faced with grade inflation while the second one had compression of marks issue, such that almost all employees were rated the same points. With the grade inflation and compression problems, Elkdahl was really disturbed whether to have the mangers carry several performance reviews until they delivered was required and therefore a third performance appraisal was imminent.
In any business environment which involves interaction of many employees, communication is a major determinant of success or failure depending on how it is put into action. The human resources VP at Circale Company seemed to have not fully used the concept of business communication skills. For instance, Ekdahl did not engage the employees in any conversation to make them aware of the performance assessment they were about to take up. Let alone the managers in charge in charge of the assessment. Not a single training session with the employees experienced the VP’s presence. However he had a meeting with the managers to inform them to conduct the project and his expectations. In dealing with the performance appraisals he rarely identified his poor communication skills leading to insufficient handling of the performance assessment. He never explained in detail the importance of the exercise and therefore the managers viewed the exercise as just any other normal compliance needed to be accomplished. He gave them strict deadlines that required fulfillment and as any other employee, the managers felt that any failure on the compliance of their roles, would lead to being sacked. This key communicational problem led to the process being tainted with grade inflation and compression of points. The first appraisal had the employees scoring highly above average while the second one saw all the employees scoring the same points. In his conversation with CFO Anita, he rarely considered her thoughts on the process and ignored her points. His failure to put into action the art of communication led to the performance appraisal one after the other.
Business communication skills influence employee motivation which is a positive feature of success in any business project. Nils Ekdahl failed to motivate both his managers and employees. A good communicative business environment encourages creativity as well as inspiration of the employees. Failure of Ekdahl’s communication skills to motivate his managers experienced just a compliance of roles and dishonesty in awarding of the points. If Ekdahl had exercised conversation, there would have occurred cases whereby the managers got creative when the new performance appraisal system failed. Unfortunately not one of the managers was concerned. They only had to carry the review to comply. The managers lost enthusiasm in the review assignment for lack of any form of motivation due to poor communication skills. They were demoralized and each time they did the assignment they came up with the same unwanted results. The VP provided them with unclear and changing directions on the process. They felt forced to go through the process again and again leading to monotony.
Inadequate communication in business can prevent efficiency in a company even within a specific department. Ekdahl did not involve all the management in the individual departments to evaluate the employees. He only got the top managers in rank from each department who might have not had information about all the employees. This showed his readiness to involve the managers but he needed to narrow it down. Whenever employees team up to perform a task in such a big company, the importance of an individual employee’s skills counts. However, without incorporating each and every manager in a department, inefficiency is likely to carry the day. Ekdahl’s failure to involve all the managers in the various departments led to inefficiency of the new system.
In implementing the above proposals, issues are likely to crop up ranging from organizational to leadership. The fact that Circale Corporation is a global entity poses an organizational challenge in getting to engage the employees in conversations about the new performance system. It may turn out as a difficult task if effective measures are not well implemented. Leadership and managerial structure of Circale Corporation will make it difficult to engage in conversations. Managers are only liable to their respective departments. For instance Ekdahl was solely involved in the performance review process. This turned out to be the cause of the communication problems. The CEO was interested in the objective of the system working rather than having the feel of the real exercise which aimed at having the best and right person into their position and hence ensuring cuts. Such challenges are likely to bar effective communication and hence implementation of the new performance appraisal and compensation system.
Conclusion
The performance appraisals were done one after the other without giving out the expected results according to the VP human resources. This revealed that the failure to achieve the goal of the new performance evaluation system was an issue arising from communication issues. Ekdahl had meeting with the managers before the review process but failed to engage them in effective communication concerning the new system. Every time an assessment was conducted the results were not pleasing. The first one revealed grade inflation while the second compression of the points. This situation would be solved if the VP implemented effective communication through conversations, motivating the managers and employees. This will make all the parties involved aware of the new system and they will cooperate towards achieving the goal. It will save the time and resources wasted in conducting multiple performance appraisals. He demonstrated leadership by giving directions on the performance appraisals. However, the new system will require that the employees first adopt it after considerations since low performance may mean losing the job. Therefore, Ekdahl should also understand that this is a long run system that needs time for effective and fully implementation.
References
Hall, B. , & Wasynczuk, A. (2011). Hbr case study: The gentleman's "three". Harvard Business Review, 89(7, 8)
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Abu-Doleh, J. & Weir, D. (2007). Dimensions of performance appraisal systems in Jordanian private and public organizations. International Journal of Human Resource Management, 18(1), 75-84.
Gomez-Mejia, L. R., Balkin, D. B., and Cardy, R. L. (2008). Managing human resources (2nd ed.). Prentice-Hall, New Jersey
