PERFORMANCE MANAGEMENT

Performance Management

Performance Management

Introduction

In today's management, most of the organisation emphasise the importance of performance management (PM). Why is PM so important to them? Is PM an essential practice to these organisations? PM is an approach to management which individual managers and employees are unified to attain organisation's strategic goals. Strategic goals are defined, and outputs are then identified to attain the goals which were clearly defined. Commitments of managers and employees are gained, to achieve the identified outputs, and outcomes are monitored. In another words, PM is an on-going process that constantly measured, monitored and controlled the overall performance in an organisation, and it is a forward looking and developmental strategic process. PM has become more and more important from the formally widely used performance appraisal scheme to today's an integrated and continues approach.

PM in today's human resources (HR) practice is no longer depends on the merit rating form as the only measurement. However, PM defines strategic goals, and identified outputs to achieve strategic goals. Managers and employees are committed to achieve the identified outputs, and monitor outcomes. Firms that adopted PM fares better in terms of financial, and non-financial factors than those firms that do not practice PM. Hence, the understanding of PM and its processes for today's firms is essential in determining and assuring its competitive advantage in the ever changing business environment.

Proformance Management Process

Through PM process, employees' talent, strengths, as well as areas which require improvements are clearly identified. This will ensure that employees are well prepared for career advancement. The process of performance management consist of mainly five major steps as illustrated in the summary of the performance management process (Moses, Hollenbeck & Sorcher, 1993).

Once strategic plan and goals are established, observation and feedback are carried out to ensure the employee's success in achieving performance expectations. The performances of employees are observed and documented. Managers will then provide feedback and necessary coaching to employees. However, the communication shall be two-way and on going. Work expectation will be reviewed and changed if necessary. If expectations are fulfilled, employees should receive recognition and be encouraged. On another hand if performance falls short of expectation, employees shall be guided to re-enforce effective behaviour to progress towards achieving stipulated goals (Mintzberg, 1980).

In collaboration with the employee, the manager will then carried out the performance appraisal (PA) to compare performance results towards job expectations. PA will be carried out at the end of the year to compare the actual performance with the expected standard. The appraisal should however stress on development issues and future oriented rather than judgemental, as employee might feel offensive (Longenecker, 1997). The adoption of multisource feedback will increase the reliability of appraisal employees are contributing each other's ideas, opinions to improve the performance. Thus, it promotes better management behaviour. Meanwhile, it also provides a means for upward appraisal where managers are also appraised by other employees. Consequently, performance of managers will be improved as well (London, Wohlers & Gallagher, ...