Investigation On Performance Management Of LH Company

Performance management is the core of modern company management,it is necessary in every company with different levels and different operation methods,for the different understanding on the denotation and connotation of performance management.LH is a professional machinery manufacturer of industrial heat exchangers,titled as National High-Tech Enterprise,and listed on the Shenzhen Stock Exchange board in 2011.Which products are applied in coal chemical,petro chemical,power generation,metallurgy and refrigerant industries.In the last years,LH had a rapid development,the profit increased by more than 30% every year.The development of performance management of LH is similar with the company itself,from optional to formal,from partial to systematic,from rule of man to rule of law,approaching to be perfect.While for its rapid development,the management system lags behind,this may affect the further development of LH.LH brought in performance management before 5 years ago.During the application,a set of performance management system came into being in LH,actually,the system is management by objectives,which focuses on instant interests,rather than real performance management system.The annual objectives is carried out top to down,weaken the interactions between managers and by managers,and the objectives cannot be understood and supported by every department.The KPI index only reflects the work emphasis of every department,lacking of scientific and logical characters.Punishment is used to push objectives without sufficient communications with objective operators.So the performance management development is not improved very well in the last 5 years,it is necessary to modify the performance management system by scientific theory.BSC and KPI are the advancing performance management tools presently,especially the application of BSC,which can balance the instant and long-term objectives,internal and external profits.According to SMART principle,based on finance,clients,interior and development factors,LH set the key performance index to guarantee the systemic of performance management.The present thesis analyzed the conditions and problems of existing performance management system of LH,by the applications of BSC and KPI,set up a new management system,which is a very efficient guidance for the operation of performance management system.