Case Studies #01 | Performance Management
Case Studies #02 | Economic Profit Incentives
Case Studies #03 | Share-Based Compensation

Challenge
To develop and implement a Performance Measurement and Management System at senior management level together with a strong pay-for-performance alignment.

Move away from the conventional performance appraisal system which is viewed as too subjective.

Carrots Solution
Carrots developed an integrated Individual Scorecard program as an objective way of measuring the individual performance achievement of senior management.

Working closely with the airline’s human resources and finance teams as well as key management executives, Carrots conducted a detailed analysis of the company’s key value drivers (financial and non-financial). This was used to design a scorecard program at the divisional and individual level incorporating key performance measures, weightages, performance standards (threshold, target, superior), scoring systems and overall performance rating classifications.

Five key components encompassing the airline’s business were identified: (a) financial, (b) customer, (c) operational processes, (d) people and (e) special projects.

Results
The new performance measurement and management system was linked to a total pay framework to reinforce pay-for-performance.

The transparent and rigorous structure of the improved performance management system provided greater accountability and individual motivational effects. The new performance measurement and management system has enabled the airline company to achieve superior financial and operational performance.