Performance Management can be defined as a process which continuously identifies measures and develops the performance of the workforce in the organization. And to do so, each individual’s performance and objectives are connected with the overall mission and goals of the enterprise. Hence, the two key elements of performance management are:
- Continuous process
- Link to mission and goals
In performance management, the managers try to figure out, the existing performance level of the employees and works on improving that level. It is a systematic assessment of the performance of an employee and using the assessment to better the performance over time.
Performance management is commonly misconstrued with performance appraisal, which is a process of evaluating the performance of the workforce and includes feedback/review on an employee job performance. However, getting feedback is not sufficient. There are three more steps involved in the accomplishment of the process, which are:
(I) Performance Interview
(II) Archiving Performance Data
(III) Use of Appraisal Data
These three activities along with the feedback are the essence of the process, which when undertaken in an organized way, the process turns out as Performance Management System (PMS).
Concept of Performance Management
As a communication system, it is developed to assist employees in succeeding. It not just requires direction, from the end of managers and supervisors, but also needs active participation on the part of employees.
It makes sure that employees are known about their key job functions, aware of the performance level expected, get constant feedback on their performance, have opportunities for training and development, get ratings on their performance and reward thereon, in just and fair manner.
At work, an employee may subjectively feel that he/she is carrying out the duties for which they were engaged, in a satisfactory manner. However, those above that employee and indeed those around, may feel, objectively, that the employee is not carrying out those duties satisfactorily. If there is no feedback from management to employee on their progress, then the employee will never realise that some aspect of their work is wanting. We will proceed on the basis that the employee is not deliberately working beneath his/her capacity.
If the employee develops bad professional habits that go unchecked, three consequences will occur:
- Such habits, if not effectively checked, grow to become conduct that may result in the employee being disciplined or dismissed
- The organization is not addressing issues of quality of performance and thereby puts the quality of product or service into question
- There will be no opportunity for the employee’s improvement, recognition or development
Performance Management is the mechanism that ensures that the employee achieves the objectives set by the organization and the organization thereby achieves the objectives that it has set itself in its strategic plan.
When considering Performance Management, it is necessary to set out some basic terms:
- Effective behaviour – the carrying out of activities
- Effectiveness of Performance – the level of the activities performed
- Criteria – the standards set by the organization for the activities
Performance management is a process intended to improve individual and organizational performance. Employees and their manager mutually establish goals and expectations that are specific, measurable, attainable and are linked to the goals of higher level management.
Some “experts” suggest performance appraisal, and its guiding system, performance management should be scrapped, because “it doesn’t work”. Others suggest automating the process, or continuing to use outmoded rating and ranking systems. None of that works, or at least none of that actually contributes to IMPROVING employee performance. To help you decide if we can help your organization, here is our point-by-point philosophy on Performance Management and its components.
Function and Purpose
- If performance appraisals and overall performance management strategies don’t improve both individual and organization performance and effectiveness, it’s all wasted effort — overhead and cost. That’s the bottom line.
- Other purposes usually associated with performance management and employee reviews, such as determining promotions, pay levels and raises and record keeping are considerations, because they are realities of our workplaces, but they should never be the primary focus.
- Performance management has amazing power to positively affect the organization, since done properly, it improves employee engagement, focuses employees on what’s important to accomplish, reduces micro management and time spent “fire-fighting” and can be used to manage change and alter organizational culture.