Performance Management
Performance
management is a system that improves individual, team & organization
performance. a strategic performance goal is to help the organization to achieve
its business goals. From an individual point of view, performance management means getting the best result within an agreed framework of planned goals, standards
& competency requirements
Objectives
of performance management for individuals
The
focus on performance management for individuals is to improve the ability of
people to achieve & exceed expectations to achieve their full capacity to
gain a positive impact on themselves & the organization
Goals
of Performance Appraisal
Both organization and individual wants
performance appraisal to meet their individual KPIs and organizational overall
goals and objectives. In some cases, these objectives or goals are compatible,
but in many cases, they are not. KPIs
are important to business objectives because they keep objectives at the
forefront of decision making. It's essential that business objectives are well
communicated across an organization, so when people know and are responsible
for their own KPIs, it ensures that the business's overarching goals are top of
mind.
Eg:
Most the companies are currently using balance scorecard to design
organizational KPIs as well as individual KPIs. In this case, organizational
KPIs are cascading down to everyone.
The
Organization’s Goals
Performance
evaluation is an important element in the information and control system of
most complex organizations. It can be used to obtain information about the
performance of employees
Hence
decisions about placement, promotions, terminations, and payment can be made.
Performance appraisal systems and, more important, discussions between
supervisors and subordinates about performance, can also influence the employee’s
behavior and performance
Figure
01: Performance Management Cycle
01. Planning:
The
planning phase is the foundation of the entire process. In this phase,
individual goals and objectives are set for the performance period. Goals that
are S.M.A.R.T (Specific, Measurable, Achievable, Relevant, and Time Based)
increase employee motivation and commitment to goal attainment, leading to
greater success
Eg:
Set annual performance goals for the organization and then cascade them down it to an individual employee as individual KPIs.
02. Monitoring:
Regular
communication is critical during the monitoring phase of the cycle. Through
formal and informal conversations, both parties should be aware of the
progress toward the successful completion of goals and expectations. These
discussions are also good opportunities to provide timely feedback and
coaching. Since the performance cycle spans several months, it is important to
keep track of key performance highlights and challenges. These notes will help
immensely when it’s time to discuss performance for the year
Eg: Monthly progress
review meetings are conducting with all department heads and department heads
are sharing departmental progress with the top management.
03. Developing: The
next step of the cycle is developing. both parties have a discussion to review
performance for the year. If S.M.A.R.T goals have been set (planning phase) and
ongoing communication/feedback has taken place (monitoring phase), both parties
should have a productive performance review discussion
Eg: Identify
gap between expected performance actual performance and develop further actions
to bridge the gap between expected and actual performance.
04. Rating: Both parties are coming up with a
mutual agreement regarding the actual performance and expected performance.
Ratings are done according to the outcomes which are highlighted in the
discussion
Eg: Finalized and
communicate performance ratings for each individual and get feedback from
individuals. Many private organizations are using the 360-degree performance
appraisal method to finalize ratings. In 360-degree performance appraisal
ratings are given by the top management, immediate superiors, peers,
subordinates, and self-evaluation.
05. Rewarding: Employees may receive
an increase to their annual base pay in accordance with their overall
performance rating. It is important to remember that performance increases
should be based upon merit. Rewards should be differentiated based on overall
performance ratings
Eg: Some companies are giving
performance-based payments and this allowance is based on the KPI marks which
everyone achieved in that period. This is a kind of variable pay and
allowance is varied according to the results that came from the monthly performance review.
References
Amstrong, 2012. Hand book of Human Resources
Managemnt. 12th ed. Londan: Kogan Page.
Chandan Kumar Sahoo
and Sambedna Jena, 2012. Organizational performance management system:
exploring the manufacturing sector. Industrial and Commercial Training, Volume
Vol.44, pp. 296-302.
Dijk, D. V., 2015.
Performance Appraisal and Evaluation. nternational Encyclopedia of the
Social & Behavioral Sciences, pp. 716 - 721.
Dilanthi Amarathunga
& David Baldry, 2002. moving from performance measurement to performance
management. Volume Vol.20, pp. 217-223.
Patrick Gunnigle
Anthony Mcdonnell, 2008. Performance management.
Pulakos, E. D., 2004.
A roadmap for developing implementing and evaluating performance
management systems. 4th ed. s.l.:SHRM Foundation.
Scott Snell, George
Bohlander, 2012. Principles of Human Resource Management. 16th ed.
s.l.:Thomson South-Western.
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Well, Sadeepa. Further adding to the post, The performance management cycle consists of several stages. This is based on the fact that the person is receiving and using feedback that is updated by the feedback orientation (London and Smither, 2002).
ReplyDeleteYes. Simply put, performance management cycles improve a company’s overall success.
DeleteThese work in two unique ways:
They help boost engagement by enabling employees to reach their potential and have greater involvement in their professional development.
They help increase productivity by aligning the work goals of each employee with the strategic goals of the organization (Thomas, S. L., Bretz, R. D. , 1994).
ReplyDeleteAdding more facts on organizational goals in performance management, Performance management is one of the important key activities performed by organizations to monitor the performance of their employees. Organizations must regularly evaluate the performance of their employees in order to understand their current and future abilities (Samwel, 2018)
According to Brudan (2010), performance management is a ubiquitous term in today’s business environment due to being embedded in the body of knowledge of various disciplines and being used at all levels of the organization.
According to Armstrong and Baron (2005), the focus of performance management is an element such as recognition, constructive feedback, personal development and career opportunities.
Furthermore, A performance management system is the key factor determining whether an organization can manage its human resources and talent effectively. Performance
Deletemanagement provides information on who should be trained and in what areas,
which employees should be rewarded, and what types of skill are lacking at the
organization or unit level. Therefore performance management also provides
information on the types of employee who should be hired. When implemented
well, performance management systems provide critical information that allows
organizations to make sound decisions regarding their people resources . (Cascio, W. F., Aguinis, H. , 2005).
Performance is important to review with employees their performance expectations, including both the behaviors employees are expected to exhibit and the results they are expected to achieve during the upcoming rating cycle. Behaviors are important because they reflect how an employee goes about getting the job done—how the individual supports the team, communicates, mentors .Behavioral and results expectations should be tied to the organization’s strategic direction and corporate objectives (Greguras, G. J., Robie, C., Schleicher, D. J., & Goff, M.,2003)
ReplyDeleteMoreover, Performance management is ongoing. It involves a never-ending process of setting goals and objectives, observing performance, and giving and receiving ongoing coaching and feedback (DeNisi, A. S., Kluger, A. N. 2000).
ReplyDelete