What is Performance Management?

In order to understand performance management we need to understand constituents of performance. Without understanding these constituents, it is impossible to have true understanding of performance management.

Constituents of Performance

Level of Performance

Capability to do

Work Effort

Opportunity to do

(Individual Attributes)

(Level of Motivation)

(Organizational Support)

Definition of Performance Management

Performance management is about improving the employee performance through improving their capacity and willingness to perform and providing all necessary resources and opportunities in that regard.

Performance Management Process

(Performance Management Cycle)
Stage 1 Planning the Performance i. Defining performance goals Stage 2 Supporting the Performance Stage 5 Administrative Decisions
[Ability to do x Work Effort x Opportunity to do]

Stage 4 Integration of the quarterly reports to work out average score and assign rating

Collection of information about performance level and comparing the performance outcome with the desired ones Giving face-to-face informal feedback and identifying cause of less than optimum performance if so. Taking developmental & motivational measures Revisiting the support functions

Stage 3 Quarterly formal performance appraisal

 The above cycle shows that performance management is based on the agreement of objectives, knowledge, skill and capability requirements, performance improvement, and personal development plans. It involves the joint and continuing review of performance against the objectives, requirements and plans and the agreement and implementation of improvement and further development plans.

The role-players in Performance Management process

Stage 1 Planning the Performance i. Defining performance goals Stage 2 Supporting the Performance Stage 5 Administrative Decisions
[Ability to do x Work Effort x Opportunity to do]

Stage 4 Integration of the quarterly reports to work out average score and assign rating

Collection of information about performance level and comparing the performance outcome with the desired ones Giving face-to-face informal feedback and identifying cause of less than optimum performance if so. Taking developmental & motivational measures Revisiting the support functions

Stage 3 Quarterly formal performance appraisal

 From the above exercise, it is clear that performance management concerns everyone in the business not just managers. It rejects the assumption that only HR function is responsible for the performance management process and replaces it with the belief that responsibility is shared between managers, individuals/teams and the HR.

Difference between PM & PA

Performance Management PM is a natural and holistic process of management, not a system or a technique. In its fullest sense, it is based on the belief that everything that people do at work at any level contributes to achieving the overall purpose of the organization.

 It relies on consensus and co-operation rather than control or coercion. Hence, it entails agreed goals, rather than set goals, and this agreement is required to be reached through the open dialogue between managers and individuals. In other words, PM develops a partnership in which responsibility is shared and mutual expectations are defined.

 It embraces all formal and informal measures adopted by an organization to increase corporate, team and individual effectiveness and to continuously develop their knowledge, skill and competence.

 It is a continuous and evolutionary process, in which performance improves over time It encourages self-management of individual performance; requires a management style that is open and honest and encourages continuous feedback loops.

 Finally, performance management is concerned with communication and involvement. It creates a climate in which a continuing dialogue between managers and the members of their teams takes place in order to define expectations and share information on the organizations mission, values and objectives.

Performance Appraisal Performance appraisal is simply formal assessment and rating of individuals by their managers at usually an annual review meeting. In this sense, it is often carried out with an audit approach concentrating on what had gone wrong, rather than looking forward to future development needs.

 Performance appraisal practiced by most of the organizations mostly exists in isolation with hardly any link with business needs. It is certainly an isolated system, run by the HR department in absence of any performance goals, standards and managerial support involved, that functions once a year and is then forgotten.

 Accordingly, performance appraisal too often degenerates into a dishonest annual ritual and line managers have frequently rejected it as being time-consuming and irrelevant. In its best use, it is part of the performance management system rather than a system by itself.

Role of Job Profile in Performance Management

Exercise

 Job profiles provide performance criteria/goals that are the means of determining successful or unsuccessful performance. Such performance criteria/goals are:
Direct performance criteria/goals (TDRs) Instrumental performance criteria/goals (KSAOs)

Issues with the Performance Criteria

The bigger concern is criteria contamination the extent to which performance criteria contain elements that are not relevant to the particular job and that should not be included in the performance goals. Criteria/goals contamination is though possible with all kinds of performance, it is mostly happens with the instrumental performance.

 For example, the performance criteria/goals for a bookkeeper should be knowledge of accounting procedures, mathematical skills, and producing work that is neat and errorfree, not with personal appearance or oral communication skillsfactors that are clearly not relevant to the effective performance of a bookkeeper's job.

 However, for a public relations representative, personal appearance and communication skills may be relevant performance criteria/goals. So , in instrumental performance, a performance appraisal should cover only the specific KSAOs needed to perform a job successfully.

 Other concern is the criteria/goals deficiency the degree to which the goals do not contain the required performance sufficiently Criteria/goals deficiency occurs when the measurement of the performance criteria is incomplete. Criteria/goals contamination and deficiency can be minimized through effective job analysis (Job Profile).