Employee Performance Management

Figure 01: Performance Management (AIHR, 2016)

What is Performance Management?

Performance management is a corporate management technique that assists managers in monitoring and evaluating the performance of their staff. The purpose of performance management is to create an atmosphere in which people can perform to their full potential and deliver the highest-quality work in the most efficient and effective way possible. (TARDI, 2021)

Importance of Performance Management

Businesses require effective performance management. It assists them in aligning their workers, resources and systems to accomplish their strategic objectives through both formal and informal approaches. Further this helps to facilitate better working relationships, to provide a historical record of performance and to contribute to professional development by encouraging communication and providing useful feedback about job performance. (FourVision, 2020)

Performance Management Process



Figure 02: Performance Management Process (ResearchGate, 2018)


Benefits of Performance Management

  • Provide performance feedback to employees
  • Payroll management / Salary administration
  • Identifying individual strengths and weaknesses
  • Acknowledging individual performance
  • Identifying performance gaps and shortcomings
  • Documenting personal decisions for future reference
  • Assisting in identifying goals
  • Making decisions career growth (Vertical progress and salary increments)
  • Retention or termination of employees
  • Evaluating goal achievements

What is evaluated in Performance Management?

  • Core Values (Collaboration, Courage, Integrity, Ownership, Passion)
  • Strategies, Actions and Tasks (These will vary from one organisation to another)
  • Duties (Based on the job role)
  • Competencies (Client Focus, Effective Communication, Leadership, Product Knowledge, Teamwork, Technical Expertise) 
  • Workplace Goals
  • Development Goals (Training Programs)
  • Measures (Key Performance Indicators)
  • 360 Degree Peer Reviews

Characteristics of a good Performance Management System

Organisations must recognise that performance management systems with a variety of features and high price tags are not always effective. A performance management system will be effective if certain features are engineered together. Some of the key characteristics are listed below.

  • Clear Appraisal Objectives
  • Accurate, Valid and Reliable Data
  • Well Defined Performance Criteria and Standards
  • Economical and Less Time Consuming
  • Post Appraisal Feedback and Interviews
  • Cohesion between Organisational and Employee Needs
  • Managers are Mentors
  • Continues Feedback
  • Measure What Matters

Role of Top Management, Line Managers, Employee and HR in Performance Management

The success of performance management practices in any organisation depends upon the commitment and involvement of the different stakeholders like top management, line managers, employees and the HR specialists. 

Top Management
Top managers set the tone for the rest of the organisation by defining trends and serving as role models for the employees. Their job is to create rules that enable effective performance management in an organisation as well as to define and act on the organisation's core principles.

Line Managers
Line managers play a critical role in implementing and enforcing HR policies. As a result, it is critical for management to ensure that line managers have the proper attitude toward performance management approaches as well as the necessary competencies to carry them out.

Employee
Employees play an important role in the performance management cycle because the entire process revolves around them. They take an active role in developing performance agreements with their line managers and participate in 360-degree evaluation schemes. They discuss their roles and the competencies required, as well as the objectives they want to achieve, with their superiors.

HR
The human resources department is critical in the design and implementation of performance management. In fact, the HR department serves as a liaison between top management, line managers, and employees. It is the human resource team's responsibility to ensure that the appraisal process runs smoothly.

References

TARDI, C. (2021) Performance Management [Online] 
Available at: https://www.investopedia.com/terms/p/performance-management.asp
[Accessed 23 March 2022]

FourVision (2020) The Importance of Performance Management [Online]
Available at: https://rb.gy/9izgfe
[Accessed 24 March 2022]

AIHR (2016) What is Performance Management? A Full Guide [Online]
Available at: https://www.aihr.com/blog/what-is-performance-management/
[Accessed 25 March 2022]

ResearchGate (2018) Performance Management Process [Online]
Available at: https://www.researchgate.net/figure/Figure-no-3-Performance-management-process-steps_fig2_330876542
[Accessed 25 March 2022]

YouTube (2019) What is Performance Management? [Online]
Available at: https://www.youtube.com/watch?v=78VaoiL9FoI
[Accessed 31 March 2022] 

Comments

  1. As described in your article, proper performance evaluation of employees is a very important function of HRM. Performance evaluation provides employees recognition or rewards for their efforts and boosts employee morale and increases their job satisfaction. This will in turn increase productivity. Good work!

    ReplyDelete
    Replies
    1. Yes indeed. Thank you for your valuable comment.

      Delete
  2. effective performance Management is really essential for an organization to motivate employees. The benefit of the effective performance will management will impacts on both Company and the employees positively. Good Luck

    ReplyDelete
    Replies
    1. I agree with you. Thank you for your valuable comment.

      Delete
  3. Employee Performance Management is really important for the organization as well as employees. You have clearly describe the importance of the employee Performance Management. Good Luck!

    ReplyDelete
  4. This is a timely and well-explained topic. Effective performance management is critical for an organization's ability to encourage people, and you've mentioned the importance of HR in this process. Good Luck!

    ReplyDelete
  5. You described very clearly.considering above facts my view ,employee performance management is a strategic approach to sustain a high-performance culture within an organization.

    ReplyDelete
    Replies
    1. Exactly. I agree with you. Thank you for your valuable comment.

      Delete
  6. A successful performance For an organization to motivate people, management is critical. The benefits of efficient performance management will have a favorable impact on both the company and the personnel. Good one!!

    ReplyDelete
  7. Your article covers a very important area. Performance management is a corporate management method that helps managers track and evaluate their employees' performance. Excellent article. Good luck.

    ReplyDelete
  8. Employee retention can be improved with an effective performance management strategy. Performance management is critical for getting the most out of your employees. Employee morale is boosted and they feel heard and valued, which is one of the key benefits of performance management. well done.

    ReplyDelete
  9. Performance management system's effectiveness lies in increasing performance and fostering employee development and motivation. Alway having positive conversation between the manager and the employee is a good performance management. Well explained good luck

    ReplyDelete
    Replies
    1. Yes, It's always better to have positive conversations with employees and managers. Thank you for your feedback.

      Delete
  10. Performance Management helps to track employees' performance and explain whether or not they need extra support, can handle a higher-level training, or deserve a raise. So Performance Management is an important function under HRM and this article explain more on that. Good work.

    ReplyDelete
    Replies
    1. Checking whether the employees need extra attention and training is very important. Thank you for your feedback.

      Delete
  11. Performance management is an essential corporate management tool which aids managers in an organization monitor and evaluate employees' work. It's primary goal is to make an environment in which employees can perform at the best. A very good article which clearly explains the importance of performance management to an organization. Good work.

    ReplyDelete
    Replies
    1. Yes, I agree with your comment about performance management. Thank you for your feedback.

      Delete
  12. Performance management should serve as a link between human resource management and the overall contribution of the employee to the organization. Article clearly showcase the importance Performance management in HRM. Good luck.

    ReplyDelete

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