This is the use of performance agreements to correct people`s behaviour. Fundamentally, we balance the benefits of using performance agreements to guide people towards the desired goals, with the red tape needed to create and manage them, and we propose that they be used only in the most important situations. So you don`t think I`ll be trapped in semantics, let me tell you a story I belonged to a few years ago. In a customer`s factory, staff time losses increased due to back and leg loads. The plant manager tried to solve this problem by developing an edict: not an employee who should raise or even plan something, i.e. 55 pounds or more. The plant`s union leaders mocked the new policy and told the plant manager that it was unenforceable. In addition, they told him that if he was blunt enough to try to impose it, they would file complaints after complaints. The plant manager insisted that the prerogative of the company`s management was to adopt such plans and that employees who did not know the edict would be disciplined. At that time, there were indeed many conflicts to deal with. But what if management had not felt the need to resort to “policy” on the assumption that employees would not agree with management`s objectives of reducing worker injuries and would oppose any change in behaviour if no consequences were drawn? What if management thought instead that it and the union would have common ground and only… Manage the deal? It is not enough to tell Bill what they expect from him and then put the responsibility for transit on his shoulders.
Performance management has more team approach – the person who passes the work must feel supported and encouraged during the process, just as they must feel personally responsible for the outcome. The most fundamental element of the control that an owner will have is the right to approve the budget for the operation of the hotel. The owner should maintain strict control over the budget process and expenses should be made in such a way that they are budgeted as soon as they have been approved by the owner. If, for any reason, the owner and the management company fail to agree on a budget (which should be at least annual) within a reasonable time after their submission, the parties should agree to a diversion and terminate the contract. The management company will often attempt to negotiate some sort of liquidated compensation in the event of termination after a budget is not agreed.