Rewarding Employee When the Budget Is Tight

Rewarding Employee When the Budget Is Tight

Introduction

Performance management has been put in the most important place in HRM, as well as in the strategic management. Performance management plays an even more important in these times of economic recession. Leaders are forced to conduct their business with greater rigor, to reduce costs while reassuring and motivating their employees to be able to get the most and so brave the storm. However, they must also think about the post recession and avoid pitfalls in the long term. This article discusses approaches to performance management in difficult economic situation while preserving the essence of the organization and knowing the advantageous position for the future. Even in good economic times, leaders often complain that performance management systems in place are too complex, too cumbersome and not sufficiently clear about the link between individual performance and organizational goals. Moreover, in times of recession, many companies need to ensure their survival, pursuing short term goals at the expense of long-term strategic objectives which include performance management (Gabris 2005 22). This paper explores the purposes and objectives of a performance management system. Reward system, motivation and performance appraisal are the most important components of a good performance management system and these are discussed in light of various human resource theories and perspectives.

Performance Appraisal

Without performance appraisal and employee recognition the organization cannot have quality human resource. To hire and manage total quality people, performance appraisal is the need of the day. Through performance management the employee can manage the employee and motivate him so that he works more efficiently. Hence performance appraisal has two basic kinds which include nature of appraisal and the context of appraisal. The objectives of performance appraisal are many. These include the responsibility of the employer in order to compensate the employee well, provide proper recognition and feedback to the employee, provide a clear distinct career ladder to each employee so that each employee works his best to reach the top. It is said that performance appraisal management is a job which is repeatedly done by the managers all year round. Employee appraisal management is just like any other work within an organization and has equal significance. In order to implement the performance appraisal system in any organization, the organization must lay down a set of value called mission statement and goal system. With keeping in mind the mission and goal, the organization must implement an appraisal system. (Taylor 2008, 98) Besides the organizational goal and mission, the organization must motivate to employee to make his own short term and long term goals too so that both individual and organization grow simultaneously. When the goals would be identified then performance appraisal methods must also be communicated to the employers so that the employees are well aware of the appraisal methods. This way employer will know that if they perform above the expectations they will have some incentives and thus it will motivate them externally as to increase motivation ...