MN7181-Performance Management and Appraisal-Blog 06

Performance management is a system designed to demonstrate how to achieve organizational goals through review and feedback, to improve performance unlike the performance appraisal or annual evaluation process, is an ongoing assessment of employees in a manner geared to match their goals to the organizational goals (Rimon, 2017).

(Video 1: Performance Appraisal vs. Performance Management)

Elements of Performance Management

• Agreement
• Feedback
• Positive reinforcement
• Dialogue

                                       (Figure 1: The performance management cycle )

Organizations that choose to use the performance management process do so because the annual review process does not meet their assessment requirements. The continuous communication loop of performance management allows organizations to meet their organization's goals and staff development and feedback needs

Benefits of Performance Management

Performance management has many benefits in that it does not have a traditional annual audit (Luecke,2006).

• Better results, because the human beings in the organization are of the highest quality and work together for the key goals.

• Managers are more successful because their subordinates are doing the right things correctly.

• Employees are offered more work, professional development and better pay because of their good work.

Problems with Performance Management

The performance management system is designed to benefit the organization, but like any system it may meet with resistance or be unconstructively applied. Many supervisors resist the change from a simple annual performance evaluation process or no process at all to the performance management system for many reasons.

A strong performance management system relies on a trusting relationship between employees and supervisors. When the employees doubt the credibility of the supervisors, they also will distrust the results of any performance management (Hanks, 2019).

Performance management systems are designed to benefit the organization, but like other systems they may have some problems too.

• Increased turnover
• Use of misleading information (if performed improperly, an employee’s performance appraisal             can be incorrect)
• Lowered self-esteem
• Wasted time and money
• Damaged relationships
• Decreased motivation to perform
• Employee burnout and job dissatisfaction
• Increased risk of litigation
• Unjustified demands on managers’ resources
• Varying and unfair standards and ratings
• Emerging biases
• Unclear ratings systems

Because of these incredibly negative effects that an improperly conducted performance management system can have on an organization, the system must be implemented thoughtfully and executed consistently.

Reference

• Rimon,G.(2017). ‘What is performance management?', Available at https://www.gameffective.com/hr-performance-management/ [Accessed 22 September 2019].

• Luecke, R., 2006. Performance Management: Measure and Improve the Effectiveness of Your Employees. 1st ed. Boston: Harvard Business School Publishing.

• Hanks,G.(2019).' Common Examples of Performance Management Problems’, Available at https://smallbusiness.chron.com/common-examples-performance-management-problems-70031.html [Accessed 22 September 2019].

• Figure 1: Huprich, (2008) A Brief Introduction to Performance Management, [Online] Available at : http://ala-apa.org/newsletter/2008/06/15/a-brief-introduction-to-performance-management/ [Accessed 22 September 2019]. 

• Video 1: Performance Appraisal vs. Performance Management. [Online] Available at:  https://www.youtube.com/watch?v=XtoznQQ3NO0 [Accessed 22 September 2019].