The survey of 24 multinational and local companies based in Thailand was carried out in July and August. Respondents were major international and national brands in banking, healthcare, manufacturing and pharmaceuticals. Fourteen of the respondent companies were multinationals, and the other 10 were local.

Hay's associate consultant Oran Petchbordee said last week there was a continued reluctance among Thai managers to link agreed-upon strategic targets to an individual's performance indicators.

"You end up with a situation where an organisation is losing money, but scorecards say 'everyone is doing good' - there is a disconnect. Business leaders are simply not linking company targets to individual performance reflected in rewards, be it pay or otherwise," he said.

The survey - titled "Performance Management Best Practices Survey for Local and Multinational Companies in Thailand" - revealed that only 42 per cent of surveyed organisations believed they were rewarding performance well.

It was worse with "performance coaching". This is the ability of managers to train and guide employees as they strive to get the job done.

In the companies surveyed, there were very few formal processes for managing and coaching performance throughout a campaign. Only 14 per cent of companies believed they did a good job of coaching.

The subject of external customer feedback divided the respondents. While 38 per cent said they were considering using it to evaluate themselves, a surprising 42 per cent said they were not.

On the planning side, 65 per cent of target setting is done top-down with only 45 per cent done by mutual agreement.

"This is a missed opportunity," said Supakorn Nittayananta, a consultant who implemented the survey with Oran. "If you want middle managers to have 'buy-in' or feel ownership of an objective, he or she has to believe in it right from the start. That's why mutual agreement is by far the best way to go."

When it comes to rewarding employees, 71 per cent said they adequately linked rewards to performance. However, 67 per cent of the companies said they just used the rather simple device of giving a raise in base salary.

The better way to do it, said Oran, would be to give variable pay tied to a project.

"An employee who does well this year on a project and gets a base salary increase may perform poorly on a different project next year. But the employer will still have to honour the base salary increase earned the year before. You'll be stuck with rising fixed costs de-linked from ongoing performance. We believe variable pay is a better mechanism," Supakorn said.

The survey found that the companies were experienced in four common business practices: linking performance to pay, doing competency tests, encouraging training and development, and aligning employee goals to corporate goals.

The report suggests that the new trends on the horizon are: using multiple raters to give feedback (not just the boss), ongoing coaching, paying more attention to external customer feedback, and better use of succession planning.

The survey said that when measuring an employee's or section's performance, the success or failure of the campaign was too often measured in financial terms. Other measures can be just as viable, such as customer satisfaction, operational efficiency, or a client's perception of your organisation.