By Bernadette Deka-Zulu (PhD Researcher-Public Enterprises)
Performance Management
To begin with, Performance Management is globally a well-known process that is recognized by Human Resource Departments. In its definition, Performance Management is understood as a corporate management tool that assists organization managers to monitor and also, to evaluate employees work in an organization According to some scholars, Performance Management System (PMS) can be defined as a continuous methodical process by which the human resource manager or department of an organization makes personnel participatory in advancing the effectiveness of the organization, by achieving the stated vision, mission and largely, the objectives of an organization.
Some scholars have defined performance management system as a strategic and integrated approach to increasing the effectiveness of organizations by improving the performance of the people who work in them and by developing the capabilities of teams and individual contributors. In other words, a performance management system is a continuous methodical process by which the human resources arm of a company makes personnel participatory in advancing the effectiveness of the company, by achieving the stated vision, mission, and objectives of the organization.
Historically, the concept of performance management was limited only to determine the wages and salaries of their employees. Organizations traditionally used performance management to shape the behaviors of employees so that specific outcome can be achieved. However, such a rewards-driven approach to performance management is not sustainable for most of the organizations. Moreover, traditional organizations have also started becoming knowledge intensive for technology-intensive manufacturing processes. The focus of performance management has gradually shifted towards promoting the learning and development of the work environment. Such perceptive change in performance management was more evident in organizations worldwide from the 1980s. At this point of time the organizational performance became a major challenge for achieving productivity and it became necessary to think in the direction of optimum utilization of human resources (Nankervis and Compton, 2006).
The general appraisal system
One common performance management system is the general appraisal system. this is where there are some constant interactions between the Human Resource Manager and the employees all year round.
Components of a General appraisal system
Setting goals: This component involves company to set goals; setting realistic goals is very important for employees as it inspires them to strive to achieve better results which impact positively on the company’s overall productivity. This is because individual or employee goals should always be aligned with departmental goals which in turn should be a subset of organizational goals. It is for this reason that Koontz (1971) also agreed that setting goals is an important aspect in any performance management system.
Planning as a component of the performance management system; the qualities and degree of expertise the employee should develop in order to meet objectives are set out for him or her. These objectives form part of the organizational strategy.
In addition to the above components is Communication and collaboration; and according to Bouckaert and Halligan (2008), a good performance management system aids in building an atmosphere of free open ongoing communication about the team, tasks assigned, and challenges encountered.
Performance evaluations:
This component of the performance management system includes the basic or regular short term ‘check-ins’ to assess how well an employee is performing on tasks or assignments allocated to him or her. This, as observed by Furnham (2004) in his study, allows for mid-course correction when deviations are detected.
Performance reviews; these are reviews which can be annually or quarterly and these allows the employees first to self-evaluate themselves before supervisors rate their performance. In recent times, evaluation has greatly enhanced the process and increased team productivity (Helm; Holladay and Tortorella, 2007).
Good performance recognition: According to Armstrong and Baron (2004) a critical aspect of a performance management system is the recognition and reward for high performers. This component of the performance management system creates an atmosphere of fair play and a level playing field within the organization.
Feedback; in an organization, feedback plays an important role in all the activities taking place (Hewitt Associates, 1994). this component of the performance management system gives the management or human resource manager the opportunity to point out personnel areas of weakness, room for improvement, and strategies on how to achieve it. Therefore, such employees are more likely to be productive than those not exposed to this process.
Learning and Development:
this component is highly appreciated company limited as it is believed that active learning and development which is an integral part of a performance management system should be promoted aggressively. As said by Holloway; Lewis and Mallory (1995) it should be ongoing and will help employees attain their performance potential.
How to implement a PMS
Implementing a Performance Management System undoubtedly, assist to improve the individual productivity of a team. However, the key to achieving that is proper implementation.
The following are the ways that a company is utilizing in implementing the stated performance management system.
Clarify expectations; the human resource management department at B.K Construction company limited makes it clear that the employees receive clarity on the implementation of the performance management system. For example, the human resource manager clearly states in specific terms the output and attitudes expected of employees within the company so as to attain the set goals.
Observing and assisting performance is also being the activities that the company is engaged in its process of implementing the performance management system. For example, Mr Phiri, who is the assistant human resource manager always watches attentively as the plan is put into action and intervene where and when necessary to ensure compliance.
In the most part, the implementation of the PMS should be seen as a process and not as an event. As such, it is a total company effort and should not be left to one person, one division of department. In addition, leadership plays an important role in steer, guide and direct the implementation of the Performance management system in an organization. It is in this regards that it is said that Performance Management commitment will always become the core function of all the supervisors, managers and executives of an organization.
Another important aspect of activity involved in the implementation process is the evaluation of performance.
Interaction and positive review are used to implement the performance management system and this is where the management generally discusses Performance, share observations, and also, it requests for employee feedback and jointly innovative activities on how to improve in the future.
Benefits
The following are some of benefits of the stated performance management system.
The first benefit of this performance Management system is that it enables employees to understand their professional goals. Practically, as the Human Resource Manager at a company or organization drafts a comprehensive performance strategy and present it to the employees, the manager is found to help the employees to figure out their expectations. This benefit was also observed by Koontz (1971) who however, stated that this works on a more general company level and on an individual level as well.
Another benefit is that of professional motivation; it makes a company to have a well-executed performance Management strategy which drastically improve the employee’s productivity at this organization. In such instances, you find that a Human Resource Manager will state that the goal of the performance management system is not there to criticize employees for not doing the right thing, instead, highlight positive outcomes and then instruct employees how to eliminate pain points. Through this, it has been stated that performance management system has benefit in that every member or employee of the company earns a brand new motivation boost.
Another benefit that can be cited is that the performance Management system is improving or improves employee retention. Generally, employees in an organization may consider leaving their current positions when faced with inadequate performance review. Having that fact in mind, a company can do the most through the performance management system- so as to ensure that there is a higher retention rate in the long-term.
According to Bhattacharjee and Sengupta (2011) performance Management System has an advantage as it enables an organization identify training opportunities. Indeed, this is not a different situation. The performance management system at the company enables it to identify training chances or opportunities. For example, the performance reviews at this company is giving the Human Resource Manager a hint about who or which employee needs some additional training activities.
The system is a great way to strengthen the skills of his team or employees while eliminating or reducing operations.
Performance Management system has benefits related to firing decisions.
As it is known, firing decisions are never the ultimate goal of performance Management, but in some situations, the organization has to deal with employees who are not able to change and evolve. In this regard, the performance reviews, which are part of the performance management system, plays as important role as it assists the human resource manager to explain and justify his decision, backing it up with concrete data, information or statistics.
Performance Management commitment system further creates high performance culture, it improves organizational efficiency and effectiveness, and also, when PMS is aligned with vision and mission, it provides a clear direction for organization. Further, organization mostly becomes a learning organization and as a result, the organization can easily attain its strategic objectives.
From the above explanations, it is clear that performance management system is important to every organization’s performance for various reasons such as; it always facilitates the organization to achieve its vision and business or organization objective. Not only that, it is a pre-requisite to develop an organization’s performance oriented culture within the organization. Additionally, the benefits that performance Management system aligns the employee’s performance goals with the Organization’s strategic goals, ensures that the employee in the company/organization has clarity regarding performance expectations and further, it improves the employee performance and identifies talented employees for promotion.
Challenges
As a system, PMS does pose some challenges that could be faced by the top management all the way to the lower level. For example, when there is lack of standardization; an explanation here is that despite having goals or appraisal sheets and documented processes to implement the performance management system there is hardly any consistency. Employees do not receive inputs now how to fill up their sheets, while managers do not get trainings on how to carry out the process or even trainings on how to use the rating scale for example.
Further, there is no fully, and clear standards on what level of performance of behavior will actually differentiate between successful, average and non-successful.
Largely, this leads to lack of clarity among both parties, the employees and employer and across the company which has resulted into ineffective and inaccurate system at the company.
Inadequate or lack of commitment from both employee and the management team and this affects the implementation of the system. In the words of Furnham (2004) the implementation of the performance management system in any company has to be supported and largely driven by both the management commitment of the organization and its employees.
This also includes lack of required skills to use the system in place, and lack of training on both parties the appraiser or employer and the appraisees or employees.
Leadership buy-in and change management are missing;
Another challenge that the system may face relates to company leaders. Leaders often mistake measurement for Management commitment with regards performance Management system as a measurement exercise, but in reality, performance Management is about feedback.
In addition, some leaders always see or view technology as a solution. Meaning that, the company cannot only or simply implement a performance Management platform and consider their work done.
From this, it is clear that there are many challenges that the performance management system do face challenges and one of them is that managers are not always trained. The reality is that people management on its own, is a complex thing,and as such. Meaning that managing and helping employees to improve are also inherently difficult tasks. Just like in many Organizations in other countries, some Managers lack the ability to do performance Management well.
Suggestions on how best the pms can be redesigned, implemented, monitored and evaluated
The first thing is that a company/ organization can do is to empower its managers to have open conversations, for example, with their employees about performance and that has to be something they do almost every day, not just at the end of the year. So, the system should be revised, the performance management or system should be reviewed on monthly basis and monitoring and evaluation should be done monthly. Monitoring employees’ performance and evaluating their performance or commitment should be based on monthly or even weekly too.
Other suggestions are that; organizations need to create an effective approach for addressing performance challenges.
Companies would do well to include factors such as mission, improvement and other areas that can actually raise performance levels for both individual employees and teams into the performance Management system.
There is need to design appropriate reward strategies and schemes, training and development strategies and plans that will serve as a baseline for implementation, monitoring and evaluation. Feedback, Communication and coaching, individual career planning; mechanisms for monitoring the effectiveness of the performance Management System and interventions are all the suggestions that should be considered in as much the redesigning, implementing, monitoring and evaluation of the system is concerned.
Effective performance Management systems always have standardized evaluation forms, performance measures, feedback guidelines and even disciplinary procedures. Therefore there is need to redesign systems where needs pose.
In terms of monitoring and evaluation, organizations that don’t, ought to come up or set guidelines for feedback, give balanced feedback, and then, outline expectations for improvement upon which monitoring and evaluation will be based on.
Conclusion:
In conclusion, we can safely say that a performance Management system is basically a mechanism for tracking the performance of employees consistently and measurably in an organization. Performance Management System allows a company to ensure that the employees and employers alike, support and commit to the implementation, enforcement, monitoring and evaluation of the PMS will ultimately provide the impetus for its implementation. In the absence thereof the PMS is not likely to succeed. Thus, PMS is a process owned and driven by line managers and should be regarded as an integral part of the continuing process of management. This is part of effective change management.
