Case 2: McMonRan Copper & Gold
What do you do when your organization needs to completely turn around its strategy due to a changing marketplace or for competitive reasons? Situations such as these are common in today’s fast-paced business environment. How does a firm manage drastic changes like this? A good performance management system can help. Freeport-McMoRan Copper & Gold is a case in point. The company, which is based in Phoenix, is the second-largest copper mining company in the world. It employs approximately 35,000 workers and has mining operations that span five different continents. But it wasn’t a poor market condition that caused Freeport-McMoRan to shift gears. It was a booming one. During much of the 1990s and 2000s, the price of copper was low-only about 75 cents per pound making mining less profitable than it had been in the past. Mining a large amount of copper therefore became less of a priority than keeping costs low for Freeport – McMoRan.
However, after the price of copper jumped sharply upward and hit $4.50 a pound, Freeport-McMoRan realized it needed to change its strategy-and fast. It needed to ramp up production and invest in new people and equipment in order to mine as much copper as possible while its price was high. The question became how to implement the change. Compounding the task was the fact that each mine was run separately. The firm’s top managers did not even know how its employees were organized at the separate mines, let alone what their goals were or the metrics they were expected to achieve. The company had also acquired a rival mining company twice its size. Phelps Dodge which made coordinating the performance of its people and operations even more difficult. In 20l3, Freeport-McMoRan went to into a completely new line of business-oil and gas-making the coordination even more difficult. To align the goals of everyone in the company and get all of its various mines performing at top capacity, Freeport-McMoRan needed a new performance management system. The system would hopefully enable the company to quickly implement and monitor the changes needed, while giving it the agility to change strategies again if or when the price of copper dropped. Many of the employees who work in its mines and oil fields do not use computers regularly on the job, so Freeport-McMoRan needed a system that was easy to use. For this reason, the company adopted a web-based performance management system that employees could use at home. Initially, the firm rolled out the system to 500 employees as a pilot program. When it proved to be successful, the entire company began to use the system. The software keeps everyone in an organization focused on a company’s most important goals, which can have a strong impact on the firm’s financial performance. It also helps organizations measure the contributions of its employees and to nurture, motivate, and reward employees based on their achievements. “Managers need reliable real-rime data and pragmatic e-tools to measure, identify, analyze, and understand their organization’s people capability and what capability is needed to compete in the future:’ explains Jonathon Hogg, with PA Consulting Group, an IT and management consulting firm. The performance system, along with the company’s strategic move into oil and gas seems to be working for Freeport-McMoRan. In 20l3, the company posted a 19 percent return to shareholders, despite copper prices plummeting again.
To sufficiently address the tasks below, you will have to refer back to the lecture notes and gather theoretical information to substantiate and display the level of critical thinking required. Moreover, your written report should follow the tasks below:
- Discuss suitable Performance Appraisal methods that could be adopted at McMoRan to enhance their performance efficiency.
- Discuss an appropriate Health and Safety measures that would be suitable for McMoRan to provide Health and Safety mishaps in the workplace.
ANSWER SUMMARY
Suitable Performance Appraisal methods that could be adopted at McMoRan to enhance their performance efficiency:
There are several performance appraisal methods that could be suitable for McMoRan to adopt in order to enhance their performance efficiency. These include:
- 360-degree feedback: This method involves collecting feedback from an employee’s supervisor, peers, subordinates, and sometimes even customers. This allows for a well-rounded view of an employee’s performance, and can provide valuable insights into areas for improvement.
- Objective and Key Results (OKR): This method involves setting specific, measurable, achievable, relevant, and time-bound (SMART) objectives for employees, along with key results that measure progress towards achieving those objectives. This method helps to align employee goals with the overall goals of the organization and can be a powerful tool for driving performance.
- Balanced Scorecard: This method involves measuring performance across four perspectives: financial, customer, internal processes, and learning and growth. By considering multiple dimensions of performance, organizations can get a more complete picture of how employees are contributing to the success of the company.
- Forced Distribution: This method involves ranking employees based on their performance, with a predetermined percentage of employees falling into each of several performance categories (e.g. top 20%, next 70%, bottom 10%). This method can be useful for aligning employee performance with the overall goals of the organization and ensuring that resources are allocated appropriately.
Appropriate Health and Safety measures that would be suitable for McMoRan to provide Health and Safety mishaps in the workplace:
There are several health and safety measures that would be suitable for McMoRan to implement in order to prevent health and safety mishaps in the workplace. These include:
- Safety training: Providing safety training to employees on a regular basis can help to ensure that they are aware of the risks associated with their work and know how to protect themselves. This could include training on the use of personal protective equipment (PPE), as well as training on specific hazards associated with their job tasks.
- Risk assessments: Conducting risk assessments can help to identify potential hazards in the workplace and develop strategies to mitigate those risks. This could involve analyzing work processes and procedures, identifying potential sources of injury or illness, and implementing controls to reduce the likelihood of an incident occurring.
- Safe work practices: Establishing safe work practices and procedures can help to prevent accidents and injuries in the workplace. This could include implementing safety protocols for tasks such as lifting heavy objects, using hazardous chemicals, or working in confined spaces.
- Emergency preparedness: Having a plan in place for responding to emergencies can help to minimize the impact of an incident and protect employees. This could include having emergency response teams in place, providing training on emergency procedures, and having emergency supplies readily available.
- Regular inspections: Conducting regular inspections of the workplace can help to identify and address potential hazards before they cause an incident. This could involve inspecting equipment, facilities, and work areas on a regular basis to ensure that they are safe and compliant with regulations.
Stop Stressing. Your Academic Success is Guaranteed.
Domyassignment is your direct route to higher grades. Thousands of students trust our PhD-level experts to deliver 100% original, custom-written papers—from tough essays to massive dissertations.
