Impact of Performance Management in an Organisation

 


In the current highly competitive global scenario, organizations must prioritize developing and retaining highly skilled personnel to thrive and maintain relevance. Performance management is a widely accepted approach to achieve this objective. Performance management involves identifying, measuring, and enhancing individual and team performance to align these efforts with the organization’s strategic objectives (Travor, et al., 2019).

Performance management plays a crucial role in Human Resources development for several reasons. Firstly, there is a significant overlap between the definition of performance management and the four primary objectives of human resources development. Secondly, performance management can serve as a bridge between human resources management and human resources development by appraising employees, which is the core function of human resources management and enhancing individual and organizational performance, which is vital for human resources development. Thirdly, human resources development professionals advocate coaching as an intervention within the performance management context. Human resources development professionals are responsible for being effective coaches and creating an environment that facilitates coaching. These coaching elements align with expanding performance management beyond the annual performance review process (Travor, et al., 2019).



Effective performance management systems play a crucial role in improving the quality and quantity of work in an organization while aligning all its activities with the goals of the institution or organization goals be utilized in various ways, such as to support pay decisions, determining employee salaries, facilitating promotion decisions based on certain criteria, promoting employee development, and managing workforce reductions (Dr.Bernardus, et al., 2022).

Having a formal performance management program can be beneficial for both managers and employees. It promotes mutual understanding of expectations, goals, career progress, and how an individual’s work aligns with the company’s vision. It helps in allocating funds from the company’s performance budget. Performance management considers individuals in the context of the wider workplace system. Although an absolute performance standard may seem unattainable, companies strive towards it. Performance management tools enable managers to adjust workflow, suggest new courses of action, and make other decisions that facilitate employee progress toward their objectives. This leads to the fulfilment of the company’s goals and optimal performance. For example, the manager of a sales department may give staff members target revenue volumes, which they must achieve within a specific timeframe. In a well-structured performance management system, the numbers are accompanied by guidance to empower salespeople to succeed (Carla, 2023).

Effective performance management benefits both organizations in achieving their goals and individual employees in fulfilling their work. This leads to improved worker retention, which is a bottom-line benefit. Annual performance reviews can often come as a surprise and create a negative feeling among workers. However, performance management involves ongoing employee feedback throughout the year, resulting in fewer unpleasant surprises. According to Gallup, a polling firm that surveys workplace issues, effective performance management requires managers to consider themselves as coaches rather than bosses. When managers engage in timely conversations with employees focused on performance, based on this principle, interaction becomes more encouraging, engaging, and rewarding than annual reviews can provide (Carla, 2023). 


References

Carla, T., 2023. Investopedia. [Online]
Available at: https://www.investopedia.com/terms/p/performance-management.asp
[Accessed 30 November 2023].

Dr.Bernardus, F., Viola, K. & Tuukondjelanee, H., 2022. EFFECTIVENESS OF PERFORMANCE MANAGEMENT SYSTEM ON EMPLOYEE PERFORMANCE. International Journal of Management and Commerce Innovations, 9(2), pp. 1-13.

Travor, C., Paula, O., Bishakha, M. & Martin, M., 2019. Performance Management: A Scoping Review of the Literature and an Agenda for Future Research. Sage Journals, 18(1), pp. 3-162.

 

Comments

  1. RezaDecember 18, 2023 at 1:40 AM

    Performance management has to be transparent and not be biased for it to be successful. The goals set showed also be achievable.

    ReplyDelete
  2. Dushantha SamarasingheDecember 18, 2023 at 2:09 AM

    Adding to the good pointer in the article. Performance management will improve the productivity of the organization as the right personality with the right skill set will be in the right place. However, it is important to carry out the process in an ethical way and not affect the well-being of the employee.

    ReplyDelete

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