Purposes Of Performance Management

In this report we come across the processes done in performance management in an organisation to link the employee activities with organisational goals. The word performance management can be split up as performance with management. Performance means what is expected to be delivered by an individual or by a set of individuals within a time frame in terms of results or efforts tasks and quality with specifications of conditions under which it is to be delivered. Performance has many dimensions- output or result dimension, input dimension, time dimension, focus dimension, quality dimension and cost dimension.

Performance management is the process of creating a work environment or setting in which people are enabled to perform to the best of their abilities and talents. Performance management is basically a managerial process which consists of planning performance, managing performance through observation and feedback, appraising performance and rewarding performance. It is a holistic and disciplined approach which includes planning, monitoring, developing, rating and rewarding employee performance.

The purpose is to translate organisational goals into individual goals and to train the employee on how to improve job performance on a periodic basis. This purpose also involves how to communicate management’s expectations regarding employee performance and provide feedback to the employee about job performance. To identify the employee’s strengths and weaknesses and to determine what kind of development activities might help the employee to better utilise his competencies/ skills on the job.

Organization plans and priorities need to be translated into service, team and individual performance objectives. Agreeing individual performance and employee development needs is normally carried out using a combined performance appraisal and staff development process. This approach provides the framework for helping managers to translate service and team plans into individual plans and objectives and agree how these will be met. Individual plans and objectives are most effective when both manager and employee agree them. Objectives should be specific, measurable, agreed, and realistic and time bound (SMART).

Develop an internal communications system:

It is normally accepted that to be effective messages need to be communicated in a range of different ways that really target the group of staff you are trying to reach. There is a wide range of different approaches that can be adopted to ensure staffs kept in contact with key performance issues. For example, there are staff briefings; meetings; lunch time seminars; use of the intranet; mini articles or stories in staff magazines; posters; bulletin boards; email alerts; line management and supervision meetings. Conducting regular staff surveys and running a suggestion scheme are also important ways of ensuring that employees have opportunities to feedback on a wide range of issues that will impact directly or indirectly on organisational performance.

Ensure the performance appraisal system is in place, is well understood and working effectively:

A performance appraisal system is traditionally used to set objectives, identify support needs and measure progress against objectives. For it to work effectively it needs to be clearly understood by both managers and employees. This means ensuring that managers have access to guidance and training to ensure that they manage performance effectively throughout the year and employees at all levels within the organization have the necessary support, guidance or training to enable them to actively engage in the performance appraisal process. The performance appraisal system should also be regularly reviewed to ensure that it is achieving what is required.

Support employees to help them perform well:

Effective induction and probation processes for new employees are extremely important in setting the right expectations for performance on both sides. If this early stage is managed well it may be possible to intervene to prevent or minimise individual capability issues later on through personal development or redeployment. Feedback from this process may also highlight problems with job design or recruitment processes, which then need to be rectified.

Responsibility for meeting staff development needs may be addressed in the team or service or may be fed back to a central HR function for action. Whatever the approach, the organization needs an overview of its organisational capability and how it plans to address any gaps that will hamper the achievement of its objectives. This strategic human resource management would normally be the responsibility of the HR function.

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Developing employee capacity to deliver organization objectives is likely to be achieved in a variety of ways. All employees, even those who have been in the same post for some time, should be encouraged to consider how they are performing and what else they could learn or do differently to deliver better services. In some cases these needs will be adequately met through attending training courses but there are many other possibilities, such as job shadowing, mentoring, e-learning, and working on projects or reading manuals. Wherever possible the employee should be given the opportunity to agree the most suitable option.

Performance needs to be actively managed and monitored throughout the year. An essential part of this dialogue is the giving and receiving of feedback. For this to work effectively the organisational climate must encourage the sharing of both success and failure. Without this employees will be reluctant to comply and the quality of the feedback may be lacking. As well as managers, employees at all levels in the organization may also need support, guidance or training to enable them to actively engage in the performance appraisal process.

Seek performance improvement:

At organisational level, this will mean identifying what the barriers are to effective performance and putting in place a plan to deliver improvement. At both team and individual level the principles will be the same, but it may be more difficult to manage, as individual sensitivities and complexities may be at the fore. Having in place a clear process for dealing with inadequate performance is important.

Identifying the reason for inadequate performance is the first step. From this the organization can determine further action, which may involve disciplinary procedures; additional training or support; monitoring and review mechanisms; redeployment; changing job roles or in some cases dismissal. It is also important that learning from these actions is taken on board, for example to improve future performance management mechanisms or selection methods. Formal capability or disciplinary proceedings take time, effort and resources, which could otherwise be targeted at more positive interventions, such as recognising good performance.

If performance management is embedded into day-to-day management practice it is likely that inadequate performance will be managed and improved before it gets to this stage; that is why following the performance management cycle on an ongoing basis is so important. Organization should also review job design and work flexibility as ways of improving performance.

Recognise and reward good performance:

This is the part that many organisations forget; instead they take good performance for granted and focus on those who have not met the standard. However, to retain motivation and continuously improve, it is essential that good performance is recognised and where appropriate, rewarded. Recognition and reward will mean different things to different people; for some financial reward in the form of pay rises or bonuses may be important, whereas for others recognition that their contribution has made a difference will be enough. When determining what will be the most appropriate reward the organization will need to understand what motivates their workforce and how they can meet this need. Pay systems and processes will be important, but it will also be necessary to identify other reward mechanisms such as opportunities for development and career progression.

Recognising performance is also about sharing success stories across the organisation and highlighting how good performance helps the organisation as a whole. This may also help with sharing good practice and learning about what works.

Performance management system in contemporary business organisations in Australia:

In general, the contemporary businesses organizations in Australia mainly implements three major steps in performance management process. They are as follows:

Performance planning

Performance development

Performance appraisal

Performance planning:

Planning is the first step in performance management. This is mainly followed by performance coaching and development. Then appraisal and evaluation come into play. Two of the keys to performance management are planning, setting expectations and making evaluations. Expectations can be goals but they are often nothing more than statements of acceptable, desired performance, activity and progress. What is critical is that expectations be clear, to both manager and the employee. The third key, of course lies in the development process and the skills of managers in carrying out employee development through coaching and problem solving. Although the performance appraiser may help to identify training needs and problems, the appraisal interview itself is not the time to coach. Coaching should take place during the months prior to appraisal. Like effective feedback, training for development requires skills in addition to an appropriately structured situation.

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Performance development:-

Training is the one of the most important step in the performance development. The Key to performance development is coaching. For example if a manager and an employee have engaged in performance planning, then performance development through coaching should be fairly straight forward, the role of a coach is quite different from that of an appraiser. The coach is a helper, who helps the employee, identifies problems he/she may be having and who helps the employee find ways to solve those problems. The role of the manager is not to assemble information and explain what went wrong to the employee, but to work with the employee to examine the information and identifying whether or not the performance is on track. The role of the manager is to give the employee useful feedback. Effective coaching depends on mutual exploration of problems and development of possible solutions. The coaching mainly consists of telling employees how to do it right. The Coach should work with the employee to help him develop better, more effective ways to do a job or fulfil the expected performance. The managers should take problem solving approaches.

Effective performance development through coaching requires a problem solving approach on the part of the manager. Unfortunately many managers neither understand this, nor do they have the feedback, and problem solving skills, needed to make such an approach work. Coaching forms a critical part of the performance management process. The main function of coaching sessions make sure that performance expectations are fulfilled or that employees make desired changes in their work activities.

Performance appraisal:

The Performance appraisal plays an important role. The performance appraisals can be defined as- any procedure which helps the collecting, checking, giving , sharing, and using of information collected from and about the people at the work for the purpose of adding to their performance at work. Performance appraisal procedures have many different purposes. And appraisal procedures main function is developing people and or organisations by using information about the behaviour of the people at work. It is mainly concerned with establishing controls on the behaviour of people or bringing about change in their behaviour by:



Constructing Succession plans.

Discovering training needs.

Motivating staff.

Developing individuals.

Performance management in Australian companies:

Many of the Australian organizations are facing human resources related problems especially related to employees. In order to overcome those errors we need to implement better performance management system. These problems mainly arise due to lack of proper planning, development and performance appraisal.

Performance management and performance appraisal system are never the same. People mistake that both are same but they are different. Appraisal is a part of performance management. We have aspects like planning, performance auditing and evaluation. There are several issues raised in recent review of a performance management program implemented in Australian companies. In short, appraisal is the way a performance management programs gains evaluative information. But, the connection between the two is worth emphasising because schemes are often proposed and promoted as purely developmental as being divorced from appraisal processes. Performance management is rarely successful implemented as a formal program with out of some form of appraisal as a way of gathering information about performance and appraisal only succeeds when it implemented as a part of performance management program which provides the necessary supportive structures and opportunities. Due to this indifference between the two, organizations are facing complexities.

The problems inherit in a performance management system deals with if the system is designed to posses certain characteristics these characteristics mainly helpful to reduce subjectivity in implementation of performance management system.

Separate evaluation and development appraisals

Specifying performance standards

Use job related performance criteria

Use appropriate performance data

Provide ongoing feedback

Developing relationship between employer and employee

Increasing appraisals use multiple rate

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Train appraisal, apple process, top management support fit with organisational culture and are the main important characteristics that should be followed for implementation of performance management in the organisation for achieving great organisational goals

Responsibilities for effective performance management:

For effective performance management implementation the organization needs to take into account a number of factors. Among these are:

Managers must be fully trained not only in the techniques of interviewing and career counselling but also must be conversant with the aims and objectives of the schemes. Performance management tries to develop the idea of a shared vision and it is the task of the manager to ensure that the employee is able to see his part in that vision.

There must be top management commitment to the system.

The performance management system should be tailor made to the needs of the organisation, and it should be aim to help or support, develop, a culture of high achievement and performance.

The Commitment of the organisation to the scheme, as well as the benefits that will flow from it should be communicated to all employees.

The scheme should be designed properly in such a way as to support the achievement of the organisation’s mission, and realisation of its values.

The principal accountabilities of employees and managers should be clear in order that all are aware of their objectives, the standards of performance expected of them the techniques that will be used to assess their performance.

It is important to develop and integrated approach to achieving more committed employees and better motivated and develops within them attitudes and behaviour that lead to enhanced performance. This would include performance counselling and training and carrier planning

The organisations must follow the main models of performance management; this performance management cycle consists of five elements.

Setting performance objectives.

Measuring outcomes.

Feed back of results.

Rewards linked to outcomes, and

Amendments to objectives and activities

Thus companies in Australia should make sure that the above responsibilities are to be assigned and to follow in order to achieve the organisations excellence.

Performance information and the performance of sales assistance:

The performance of sales assistance in a selected business plays a major role with the help of sources of performance information in one of the main processes in the organisation.

Fairness of performance management:

It is very important to monitor the introduction of performance management very carefully but it is equally crucial to continue to monitor and evaluate it regularly in an organisation.

The method of monitoring and evaluation is to ask those involved managers and individuals. The evaluation can be carried out by members of a group and/or by the HR function. Individual interviews and focus group discussions can be supplemented by a special survey of reactions to performance management, which could be completed anonymously by all managers and staff. The results should be feedback to all concerned and analysed to assess the need for any amendments to the process or further training requirements. An example of a performance review evaluation form and typical attitude survey questions are given as follows:

How effectively was the review meeting conducted in each of the areas listed below?

Rate each aspect of the review meeting as follows:

very effectively


fairly effectively

not very effectively

How would you rate the overall effectiveness of the meeting?

very effective


fairly effective


How did you feel after the meeting?

highly motivated

reasonably well motivated

not very well motivated


There are different methods being followed for appraising or evaluating performance of employees in an organization. Some of the methods are discussed as below:

Past-Oriented Appraisal Method:

Future-Orientated Appraisal Method:

Past – oriented appraisal method:

The past oriented appraisal method includes the following steps:


Paired Comparisons

Forced Distribution

Behavioural Checklist

Critical Incidents

Graphic Rating Scale

Behaviourally Anchored Rating Scales (BARS)

Future-Oriented Appraisal Methods:

The future oriented appraisal methods include the following steps:

Management By Objectives (MBO)


Psychological Appraisals

Assessment Centres

These are the main important methods for evaluating the performance management of an employee for achieving organisational goals. Thus we can evaluate the employee’s performance using above methods where we can achieve organizational goals through employees.

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