Comparative Analysis of Performance Management Strategies (PMS)

Effective management of human resource is fundamental to any organization, particularly with the modern competitive environment. Barrows & Neely (2011) asserts that, the convergence of the global economy into a synapse of universally linked and co-dependent sectors create an urge to manage human resources for maximum performance of the organization. The uniqueness of many organizations is focused on innovations and trust more than relative assessment of sales and market share. The current market dynamics and economic situation of global recession have made organizations to consider the essentiality of human resource specialists (Armstrong, 2006). Performance Management Strategies refer to activities that guarantee that organizational goals are constantly achieved in an effectual manner. Google and Microsoft companies are the leading technological innovators. Google has a diverse workforce, comprising of countless communities of people of their own novelty. The workforce size of the company stands at approximately 20000 employees (Redburn et al., 2007). The employees who range from game developers to runners at Google theatre are affianced in facilitating multiplicity projects at Google and the community at large. Some of the weaknesses of Google’s PMS include employment branding as a recruitment tool and slow process of screening and recruitment. This paper analyses and compares the performance management strategies of Google and Microsoft corporations
On the other hand, Microsoft organization perceives the human resource department as indispensable part of its operational strategy which can openly lead to its success or failure, hence it deploys performance management strategy that is able to access, foresee, predict and apply its strategies in line with the its organizational targets (Axson, 2010). Microsoft’s performance management strategy is allied to its business goals to guarantee their achievement. AIDitionally, through human resource department, Microsoft has an accurate environment scanning and forecasting and utilization of knowledge and resource to increase performance. The organization’s workforce consists of approximately 91000 employees, almost five times that of Google. Microsoft advocates for employment of digitally knowledgeable people and provides training strategies focusing on the same employability. Moreover, the company’s workforce development programs are aligned to ensure that workers have IT knowledge necessary for its performance (Jackson et al., 2011). Currently, the firm’s PMS system faces problems associated to temporal employment. It has been observed that at any given time almost a third of employees at Microsoft are temporal. This scares people with necessary skills to apply for jobs.
Similarities between Google and Microsoft PMS
            Google and Microsoft companies have an almost similar goal when conducting their recruitment or employment process. Being key players in technological market that is typified by stiff competition, these companies opt for the best quality of workers. Barrows & Neely (2011) point out that, a workforce that is capable of instigating innovation, which corresponds to the companies’ performance management system, and puts it ahead of competition is of great benefit. Google Organization ensures that it hires the right people, technology professionals with much interest in their company and willing to take extra miles in making the company their second home. Microsoft Company also adopts the same notion by favoring intelligence over other factors during hiring process. AIDitionally the company has been recognized for offering jobs to college graduates with necessary skills to achieve its organizational goal (Redburn et al., 2007). The quest for having an efficient and smart workforce is portrayed by both companies, revealing a common characteristic in their Performance Management Strategies employed.
Microsoft and Google have a modeled PMS system. Google adopts the business strategic model revealed simply by the banners at the entrance of the companies Toronto Office, which says, “Proud to be Geeks.” This shows the single-mindedness with regard to focus among employees of the company. To emphasize this business strategic model, the company’s offices are perceived as dream destinations for the professionals. According to Choo & Bontis (2002), the employees’ work culture and commitment of not waiting for deadlines and project proposal is a natural challenge underpinned by the desire to solve for or innovate something. Microsoft has also implemented its own version of Google’s story named performance culture model driven by the human resource department to pursue its organizational goals. Cokins (2009) affirms that, PMS-based strategy facilitates employee innovations and instills commitment to improve the company’s performance and achieve a collective goal. The strategies have the same purpose, but with different names in both Google and Microsoft apparently showing the similarity in creating a working culture and commitment in managing their performance as competitors.
Employee performance particularly through motivation is practiced in Google and Microsoft Corporations. At Microsoft, motivation is a primary tool for managing performance through understanding employees’ inspirations (Dressler, 2004). The recruitment system of the company employs people who are willing to be inspired by the environment they are presented with whereas the human resource department has a role to guarantee the accomplishment motivational process. Microsoft ensures that employee relationship and the company is at its best, which is fundamental in employee motivation. In aIDition, the relationship offers an effective working environment to the employees; hence, it is a way of regulating their performance to an optimum level. Epstein (2004) clarifies that Google Corporation deploys much of monetary motivation that has led to its wildly success as an internet company. Some employees have been offered company shares worth 12 million dollars and it has promised more shares to other employee categories. According to General Books LLC (2010), the reason behind this monetary motivation is to inspire and maintain the current workforce, which is a performance management approach.
Differences in PMS of Google and Microsoft
            Google organization provides incredible training and development opportunities to its employees to enhance employee performance whereas Microsoft does not offer such opportunities, but it is inclined towards employing young university graduates. Some examples of professional training and development opportunities offered by Google include presentation skills, business writing, executive speaking, management, content development, and feedback delivery among other (Hitt et al., 2010). Google’s ethnic diversity has forced the company to consider providing free lessons on foreign languages such as French, Spanish, and Japanese. Engineering training programs done by engEDU offers training, mentoring, career development and tutorial programs to all engineers. The training and development sessions are compulsory for all Google employees for at least 120 hours annually (Hitt et al., 2010). This reveals the extent Google is willing to focus resources to keep it abreast of technological innovations and professionalism. On the contrary, Microsoft does not nurture its employees’ professionalism but opts to hire college graduates. The company sources its workforces from influential educational institutions such as Harvard, Yale, and Stanford University’s with less regard to experience. It is important to note that Microsoft meets its human resource needs by focusing on the right person instead of skill (Jackson et al., 2011).
Google and Microsoft have different ways of rewarding of their workforce. Microsoft deploys an option driven engine approach to provide reward their employee whereas Google has a compensation structural approach to cater for the varying needs of their workforce. Presently, Google remains to be the most preferred company to work with although it is among the most underpaying companies in technology industry. The Performance Management Strategies applied by human resource department suits the company’s business model. The support system offered by the company to its employees to promote innovation attracts many job seekers when compared to short-term monetary returns. Kreitner & Cassidy (2012) maintained that, the working environment at Google is more convenient by offering a wide range of cheap services ranging from day care to hair salons. These services are technologically obsessed. AIDitionally, the innovative stock option system, considered as tremendous growth in equity, guarantees compensation competitively to all employees. Google was the first company where directors requested for decrease in compensation and salaries since they were paid what they could not spend (Cokins, 2009). The company still had 1.43% stock turnover. Regarding employee rewards, Microsoft adheres to the concept of associating employee ownership with employee motivation and withholding (Marczyk, 2009). The company offers rewards based on technical skills and managerial skills. Many organizations would reward employees with managerial skills by offering top positions and employees with technical skills would not advance. At Microsoft, technical skill is valued hence technically skilled workers would advance to technical experts. The PMS difference in these employee reward systems is that Google focuses compensation whereas Microsoft concentrates on both managerial and technical advancements (Mckenna & Beech, 2008).
Reasons for similarities and differences
            The existence of same goal in the process of recruitment is because the companies belong to technological industry characterized by diverse innovations. Google and Microsoft esteem novelty more than any other thing. As such, the companies end up having a recruitment system that achieves the desired goal of acquiring employees capable of initiating technological innovations to improve on performance. Mathis & Jackson ( 2011) argued that, the struggle of being abreast of competition requires IT professionals, which is achieved through a recruitment system that hires the right choice of employees as revealed by Microsoft’s and Google’s human resource department.
The second similarity between the two companies is attributed to the fact that each company needs its own unique Performance Management System. However, the PMS systems in both companies are different but achieve the same goal. Google employs a business strategic model whereas Microsoft adopts the performance culture model (Kreitner & Cassidy, 2012). These modeled PMS systems in the two companies are supposed to provide motivational inspiration to the company’s employees hence improving performance.
All companies need to motivate their workforce and Google and Microsoft are not exceptional. This reveals why the companies motivation has become an integral tool in improving performance. Mckenna & Beech (2008) said that, It is obvious that the Microsoft and Google have recognized positive results such as train of innovations due to employee motivation. Such outcomes have made both firms to center their resources towards employee motivation to improve Performance Management Strategies. It is justifiable to affirm that the companies tend to copy each other’s strategies to avoid being behind advancements in technology (Pecora et al., 2009). Microsoft would implement performance strategies already applied by Google and Google would steal ideas from Microsoft to keep pace with technology hence the existence of similarities in both companies.
On the flipside of the coin difference in Performance Management Strategies, also exists alongside similarities. According to Redburn et al.(2007), the first reason for differences is the fact that Google organization is focused on internet search and cloud computing whereas Microsoft concentrates on manufacturing and licensing computer programs. This reveals that the companies meet different clients with different needs therefore a similar PMS system cannot work for them. Microsoft has to mold its PMS system to meet the needs of its customers. Google has to employ its own system to meet needs of its clients. Innovations in Google and Microsoft are different since the companies tread in dissimilar field of technology.
Weaknesses of Microsoft Performance Management Strategies
            Microsoft’s Performance Management System has failed incorporate diversity recruiting programs. Shields (2007) defines diversity as situation of having a wide variation in perspectives, ideas, and experiences among employees in decision making process, product design and service delivery. Microsoft organization Performance Management Strategies lacks people with diverse ideas, background, and experiences to participate in the operations of the organization. Microsoft employs college graduates who lack experience and diverse ideas hence they are hindrances to improving organization’s performance. Inclusion of diversity during hiring process can be associated to many factors namely unclear goals, lack of rewards and innovation tools, weak recruiters, and lack of strong business case (Tonchia & Quagini, 2010).
Microsoft’s Performance Management Strategy has failed to include older individuals with necessary technical skills that can be vital for the company’s performance. The current PMS emphasizes on hiring college graduates and has been a tradition form the initial days. Young graduates lack sufficient experience in their field of duty. This forces the company to be patient with new workforce to provide enough experience. This implies that the company wastes time to cope with new employees instead of concentrating on innovations. AIDitionally, much of resources are centered on providing employee training and development, increasing the company’s expenses.
Ungson & Wong (2008) pointed out that, Performance management Strategies entails employee appraisal, which consumes a lot of time. Managers at Microsoft have to spend much time carrying out the assessment due to the large number of employees. Verweire & Berghe (2004) also aIDed that, carrying out a department’s appraisal can take several hours, moreover, the reviewing by the employees also consumes more time. This practice of performance management strategy is setback that needs to be tailored. The performance appraisal can also arouse discouragement among the staff especially when the process turns out to be an unpleasant experience (Ungson & Wong, 2008). Performance management strategies should aim at encouraging employees and positive reinforcement, which is opposite to what an appraisal might present. Performance appraisal is also prone to biasness due to performance rater errors popular for managers who assess performance (Shields, 2007).
The current PMS at Microsoft does not stress on retention and orientation. As much as Microsoft’s Performance Management Strategy is effective at alluring and employing candidates, it cannot facilitate overall goal achievement of an excellent program for the company without seriously considering orientation and retention of applicants (Redburn et al., 2007).
Weaknesses of Google’s Performance Management Strategies
            The first weakness in Google’s Performance Management Strategy is employment branding. Pecora et al. (2009) consents that, Google Company is a popular employer, yet much of its reputation, program, and ideas have originated from external firms outside its human resource department. Employment branding is the only available long-term hiring tool to the company (Mckenna & Beech, 2008). As much as the company spends money and dedicates resource on human resource department, it does not deliver what is expected of it. The department can be perceived to be developing a formal hiring brand and execution plan.
The use of metrics as performance tool makes Google’s PMS system vulnerable to downsides. It is incredible how the human resource and the recruitment team at a technology company such as Google, managed by professionals and largely staffed by mathematicians could resort to developing metrics. The organization is expected to have the capability to trail the on-the-job performance of new employees. The recruiters need to be pessimistic and embrace to make data-grounded decisions and not their own perceptions. Google Company is beyond the usage of Metrics, as such would be degrading of itself and lowering its standards as one of the best employer companies available in the United States (Mathis & Jackson, 2011).
The PMS system of Google with regard to recruitment is slow. Nearly all candidates applying for jobs at the company have affirmed that the screening, recruiting, and interview processes are slow. Marczyk (2009) ,maintains that, the keystone behind slow speed is inclined towards the requirement that senior management must approve all new-hired professional. This approval happens in one day per week and to some extent, the activity hinders hiring efforts and wastes much time and resources. As much as the approvals are important at top, related time to fill the empty positions must be aIDressed as the company goes global.
The Google approach has a poor recruiting strategy epitomized by random occurrence even though the performance management strategies are carried out formally, well- communicated strategy (Kreitner & Cassidy, 2012). Neither the managers nor the recruiters at Google can clearly express the strategy and demonstrate how it differs Google from other companies such as Microsoft. This shows that it is important for Google to adopt a well-stipulated recruiting plan and advanced that emphasizes on holding up and building a competitive advantage. This setback is likely to reduce the company’s state of preference among candidates hence it declines from the position of being the best employer. Google’s PMS seems to offer employment opportunities to the youths rather than the elders with sufficient technical skills and experience. According to Jackson et al., (2011), the discrimination of senior experienced personnel creates biasness based on age and denies the Company essential experience that will improve productivity in the end and facilitate collective goal achievement.
The rate of temporal and contractors in Google is high. The company is reluctant to offer permanent employment to recruiters hence chances of getting experienced recruiters, having mortgages and car payments are diminishing. This poses the human resource department vulnerable to instability affecting the quality of the workforce, which affects productivity. The temporal employment of recruiters results to emergence of “rookie” recruiters who gather experience as they go.
Implications of poor Performance Management Strategies on productivity
            Poor performance management strategy has various repercussions on the productivity of a company such as Google and Microsoft. However, many managers, human resource professionals and the entire company do not regard the correctness of PMS and employee reviews. The first implication of poor performance management practices to Google and Microsoft is the incurrence of direct costs through decline in productivity (Hitt et al., 2010). This is popular when performance issues are not dealt with quickly. Infrequent employee reviews and rare talks between the manager and employee in both companies are likely to create remarkable inefficiencies.
Epstein, (2004) points out that, Subjection of employees to poor performance management strategies and performance review practices disposes employees to upset, demoralization, and anger. Employees develop a belief that managers are less concerned with performance or might be searching for people to impose their blemishes. AIDitionally, employee performance reviews that incline managers and employees on antagonistic ends, forces the employee to initiates a lack of communication between the workforce and the managers (Dressler, 2004). Employees cut off the communication channel since they believe that conveyed information would be employed to impose blames on them. This results to a breakdown of communication as the manager acquires less or no information necessary to influence business decisions (Cokins, 2009).
            Choo & Bontis, (2002) recommend that, Google and Microsoft should widen the age range of the employees they want to hire to incorporate the elderly. The two companies have a tendency of offering the youths’ employment opportunities whilst forgetting the elderly. The youths have necessary knowledge but majorly have insufficient experience at work places forcing the companies to carry out supplementary training and development to enhance their experience. The elderly have an accumulated experience for a very long time hence they might of great benefit by reducing the cost aIDitional training. However, this does not guarantee that the youths should be denied chances of employment but same and equal chances should be offered to both the youth and the elder having necessary skills to avoid age discrimination. Age diversity is an important performance management tool (Barrows & Neely, 2011).
Reducing the time spent on applying PMS systems. The current PMS systems in both companies have been observed to be consuming a lot of time. Microsoft has an integrated performance appraisal tool in the PMS systems whereas Google has been claimed to be having a slow recruiting and screening process. The Performance Appraisal of Microsoft consumes time due to the large number of employees the organization has. To deal with the issue, Microsoft should employ technology and create systems capable of performing employee appraisal within a very shorter time (Jackson et al., 2011). Google needs to restructure the employment of recruiters from temporal to permanent employment to speed up the recruiting process. This will create enough time that will facilitate productivity leading collective goal achievement, which is an objective of the Performance Management Strategies (Hitt et al., 2010).
According to Redburn et al. (2007), Google and Microsoft should carry out extensive research and development activities on human resource available to the company. This process should begin by the finance department of each company setting aside money for expansion of research and development activities, considering the assets and liabilities of each company. With an approximation of 70% of research and development funding spent on efforts to improve Google’s labour, the finance department should work out and determine whether improving the workforce is effective and efficient (Verweire & Berghe, 2004). There may be other cheaper ways of solving the problems in the PMS systems, saving the funds that could be used for future gain. This is only achievable through research and development activities (Hitt et al., 2010).
In conclusion, performance management strategies refer to activities that guarantee that organizational goals are constantly achieved in an effectual manner. Recruitment, motivation and training are examples of the activities that can ensure that organizational targets are achieved. Microsoft and Google are key players in the technology industry that embrace innovation. The firms have different Performance Management Strategies that share some similarities and reveal differences. Google and Microsoft have an almost similar goal when carrying out recruitment process, which is to acquire the best employees. The two companies also have a modeled PMS system and motivate their employees’, with Google adopting business strategic PMS and Microsoft adopting performance culture PMS. Employee reward in the companies differ, Google offers much of monetary reward whereas Microsoft offers an option driven reward approach. Some of the implications of having poor PMS system include incurrence of direct cost because of decline in productivity and subjection of the workforce to anger and demoralization. However, there are recommendations for Google and Microsoft to improve their PMS system. Examples of recommendations include widening the range of employees to involves the adult, reducing time spent on recruitment and carrying out extensive research and development activities.
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