Management refers to the process of ensuring that goals and targets set by an organization are met within the stipulated time, and resources are used effectively to achieve those goals with minimal wastage. Performance management is a continuous process that outlines the expectations supposed to be met by the employee in terms of their job description and in line with an organization’s goals, mission and vision, standard setting and providing a framework for monitoring and evaluation, appraisal and activities aimed at improving employee performance (mirani, 2004). A complete performance management system should include planning of performance, appraisal and reviewing, employee feedback, staff motivation and plans for performance improvement and a framework for potential appraisal. (steve brown, 2012)
Planning of performance involves an agreement and goal setting. There is setting of targets and identification of areas that need improvement. This is done at the beginning and forms a crucial component in the process of performance management. it charts the path to be followed. (steve brown, 2012)
Appraisal and reviewing involves rating the appraisee in terms of the achievements so far. The employee should first rate themselves. The final rating is done by the appraiser. It is mostly done twice in a year in most organizations using measurable milestones that the employee has achieved. (steve brown, 2012)
Employee feedback is whereby the appraiser communicates with the employee on whether their performance is up to the expected level. They identify potential areas of weakness and those aspects in which they need more training. This enables them to improve their performance (steve brown, 2012)
Staff motivation is another key component. It involves recognition of efforts and appreciation of exemplary performance on the part of the employees. This will greatly improve their morale. They hence own the goals and vision of the organization. (steve brown, 2012)
Plans for performance improvement are then made which basically entails setting of new goals and new deadlines in mutual agreement between the appraiser and the appraisee. The appraisee is guided on areas they are expected to improve and the time line they are expected to do so. A framework for potential appraisal is put in place by mapping the various competencies and achievements of each appraisee. With the help of other employee based assessments, this will provide a guideline for both lateral and vertical job movement, planning of successions and job rotations.
There are different types of performance appraisal: the 360 degree appraisal, general performance, technological or administrative, manager performance appraisal, and employee self-assessment, project evaluation review and sales performance appraisal among others.
In 360 degrees appraisal, other employees give their information about a particular employee which the manager considers in appraisal. General performance appraisal is a continuous communication process between the appraiser and appraisee, whereby in the end the appraiser will determine whether specific goals have been met. Technological or administrative appraisal will be more focused on technical skills and the amount of completed specific tasks. Manager performance appraisal is carried out by the appraiser using information obtained anonymously from the team members. The other type is employee self-assessment whereby the employee rates themselves then the manager harmonizes the information with discussions with the employee. Project evaluation review involves appraisal done within completion of a specific project. This provides insight on adjustments that need to be done in the next project. Finally, sales performance appraisal is simply where the appraise is judged by their results against the set goals.
Basically, managers especially in the human resource department are charged with the duty of giving performance appraisals. Others include the employer in case they have delegated duties to another person to manage on their behalf. Any individual with a higher position or rank, either by appointment or delegation from seniors can issue performance appraisals to the juniors to evaluate on their performance. Employees can also evaluate themselves as part of self-evaluation.
A performance management system supports employee motivation and contributes to maximizing company performance and competitive advantage, more obviously because the success of any company will depend on the effectiveness of the individual employees. It stimulates collective and individual responsibility by making them aware of their areas of weakness and providing a framework for their improvement. It helps shape an organizations culture and values by ensuring that each employee upholds those values at an individual level. A performance system helps to reward excellence and boost employee morale leading to increased productivity. It also provides a very good base when making major employment decisions (hastings, 2010).
Examples of how motivation techniques will lead to maximal employee contribution includes giving feedback regularly as this will inform them on their progress and make them aware of the milestones achieved so far. Assigning roles to people according to their strengths will enable them to exploit their capabilities to their maximum. Setting of clear targets that are more tangible will make the employees recognize their intended target and work to achieve them (holmes, 2012) opportunities to earn extra bonus money will also go a long way in improving employee performance. Sponsoring the employees to capacity building forums and giving an extra day in business trips will make them feel motivated and show gratitude by doing great work.
A complete performance management system is therefore the norm rather than the exception. It gives a company a competitive edge in the market. The performance of an organization can never be better than that of its employees. This hence makes such a system the backbone of any performing company.