Citibank Performance Evaluation Case Study
1. Analysis of the Citibank’s new evaluation system
In order to deeply understand the Citibank’s new performance evaluation, first we need to clarify the purpose of Citibank’s introduction of the new performance scorecard. It’s basically an attempt to highlight the importance of a diverse set of measures instead of the single financial performance in achieving the strategic goals of the division. Specifically, from Frits Seeger’s point of view, the high service quality strategy and other dimensions were critical to the long-term success of the franchises. The customer satisfaction and strategy implementation indicators, therefore, were introduced into the new performance scorecard.
Consequently, the new scorecard has consisted of six diverse perspectives. And the objective for implementing the scorecard performance measurement was to figure out what need to be done to meet the measurement perspectives from a balanced view. Then the targets also have been established for each perspective, for example the customer satisfaction has been set for achieving a rating of at least 80 in 1996.
However, looking deep into Citibank’s new evaluation method, we could spot several big weaknesses:
– Subjectivity plays an important role in the new evaluation system. First there are two ratings related to people and standards that lack an appropriate objective indicator and largely be determined by branch manager’s superior. This leak leaves a big room in the evaluation system for causing unfair results according to personal relationship between branch managers and their superiors and other drivers instead of real performance. However, from the case, we could hardly know what James really did on these two perspectives because his high ratings on these two factors were significantly due to the Lisa Johnson’s one-sided praise. Another issue is how the quarter evaluations combine into the annual evaluation. The supervisor has way too much power to change the annual evaluation result that really affects managers’ benefits, according to the different methods of using mathematic average for quarter evaluations or giving a new overall evaluation to each branch managers.
– Bias and efficiency problem of the evaluation system. The customer satisfaction, for instance, also has underlying bias issues. It’s obviously unfair that all branches from entirely different customer and competitive environments use same standard, say scored 74 to 79 to get a “par” rating in customer satisfaction. Given the diverse customer base along with their sophisticated and complicated needs, and highly intensive competition in the financial district area in California, James’s branch faces overwhelming challenges of customer satisfaction.
– The evaluation process of customer satisfaction is also less defensible. In spite of the bias and efficiency problem