Performance Management and Leadership Development at Avery Dennison

Profitable, sustainabletop-line growth

Growth Productivity

People

Disciplined, cost-cutting, margin expansion and productivity improvements

System and tools to: – Identify opportunities – Satisfy unmet needs– Develop people

System and tools to: – Continuously improve processes– Design products right the first time– Develop and train people

Talent, ideas, expertise and commitment Talent, ideas, expertise and commitment

Purpose. Passion. Potential. Pride.Our people make a world of difference.

ValuesIntegrity Service Teamwork Innovation Excellence Community

Key source of competitive advantage

Why focus on people development?

People are the foundation for growth and productivity of the organization

Avery Dennison has several programs devoted to building a strong workforce and work environment

GPS

People Leadership

Expectations

LDR

These programs create an environment that focuses on employee opinion, development, and

contributions to the organization

People Leadership Expectations

People Leadership Expectations

Avery Dennison supervisors are evaluated on, and held accountable for, achieving a set of People Leadership Expectations. Employees, in turn, are expected to give their supervisors honest and fair feedback to help them meet these expectations. Working together, we produce great results and make Avery Dennison a great place to work.

Our people are our most important source of sustainable competitive advantage. Their talent, creativity, energy, teamwork and commitment drive our growth, productivity and profitability.

People Leadership Expectations

Employee Treatment

1. Treat all employees with respect, recognizing the importance and value each brings to the organization.

2. Treat employees fairly and administer policies consistently.

3. Be flexible in allowing employees to attend to personal needs in the context of getting the work done.

People Leadership Expectations

Performance Management

4. Establish and communicate clear, high performance standards and hold employees accountable for achieving them.

5. Provide employees with regular feedback and coaching to help them develop skills and achieve their career goals.

6. Recognize good performance and contributions.

People Leadership Expectations

Performance Management (cont.)

7. Pay and promote employees based on job performance.

8. Deal fairly and effectively with poor performing employees, giving them specific, constructive feedback and taking appropriate action.

9. Develop capable, internal successors for all key roles.

People Leadership Expectations

Work Environment

10. Be visible and available to your staff to answer questions, remove obstacles and provide needed support.

11. Actively solicit and, where appropriate, act on employees’ ideas.

12. Communicate important business information to your staff regularly.

People Leadership Expectations

Work Environment (cont.)

13. Support all Company values, strategies, goals, policies and programs.

14. Build strong and effective teams and promote teamwork between departments and businesses.

15. Create a working environment in which diversity of background, styles and skills is valued and leveraged.

Global Performance System (GPS)

What is performance management?

An ongoing communication process that involves both the manager and the employee in: – identifying and describing essential job functions and relating

them to the business / group goals– setting realistic and appropriate performance goals and

expectations – giving and receiving feedback about performance – writing and communicating constructive performance

appraisals using consistent standards– planning education and development opportunities to

sustain, improve or build on employee work performance.

GPS is the system used to support the performance management process

Performance Management at Avery Dennison

Avery Dennison Supervisors

Professional/Technical/Administrative

Employees

Manufacturing/Distribution

Hourly Employees

GPS HourlyUpward SupervisorFeedback (USF)

GPS Online1 3 2

GPS = Global Performance System

GPS has three components globally:

1) GPS Online to capture performance of professional/technical/administrative employees

2) GPS Hourly to capture performance of manufacturing and distribution shop-floor employees

3) Upward Supervisor Feedback (USF) to capture performance of supervisors on measures tied to the People Leadership Expectations

Process Overview

To establish performance expectations for the upcoming year, and to set individual Key Responsibilities and Major Objectives that link to the goals of the department, function, business unit, and/or organization.

PerformancePlanning

Mid-Year Review & Development

Planning

Year End Review

ONGO

ING

COAC

HING

& F

EEDB

ACK

To review progress against Key Responsibilities and Major Objectives, to ensure that the performance plan remains aligned with the needs of the business. To ensure that every employee is following a comprehensive development plan.

To ensure every employee receives detailed feedback regarding his/her performance and developmental progress during the review period, against the agreed performance expectations.

Leadership Development Review(LDR)

What is LDR?

• The Leadership Development Review (LDR) process is a systematic approach to talent management within Avery Dennison to:– Know the employees in terms of strengths, developmental

needs, career aspirations, and action items to increase readiness for their next role;

– Apply a systematic way to identify key positions and the availability of prepared individuals to occupy these key positions;

– Focus managers to think through development plans of employees;

– Review organizational needs against current bench strength.

• Businesses and functions are reviewed every two years

LDR Process

1. Leadership reviews business strategy and implications related to people

2. Organizational view– To create action plans around succession gaps and

people development– To achieve talent review metrics

3. Individual view– To accelerate readiness for all talent– To upgrade talent bench strength

Business & Functional ReviewsSite Division Group Corporate

LDR Grid

Basic foundation of LDR is to examine both performance and potential

Pro

mot

abilit

y/ C

apab

ility

Performance / Contribution

Leadership and Organization Development

GPS, LDR, and the People Leadership Expectations are some of the global initiatives / programs to develop Avery Dennison’s human capital, while creating a supportive culture that values the employees’ contributions to the organization.

These programs are also aligned with other efforts such as strategic staffing, standardized onboarding, developmental forums, and career maps to strengthen Avery Dennison’s ability to hire and develop strong talent in the organization.