Performance Management

History of Performance Management

Performance Management began around 60 years ago as a source of income justification and was used to determine an employees wage based on performance. Organisations used Performance Management to drive behaviours from the employees to get specific outcomes. In practice this worked well for certain employees who were solely driven by financial rewards. However, where employees were driven by learning and development of their skills, it failed miserably. The gap between justification of pay and the development of skills and knowledge became a huge problem in the use of Performance Management. This became evident in the late 1980s; the realisation that a more comprehensive approach to manage and reward performance was needed. This approach of managing performance was developed in the United Kingdom and the United States much earlier than it was developed in Australia.

Performance Management

Performance Management

Principles of Performance Management

Performance management Process

Performance Management Cycle

Performance Management Vs Performance Appraisal

Benefits of Performance Management

7 Strategies for People and Performance Management

Methods of Performance Management (Refer Performance Appraisal Methods)

  • Comparison Method

  • Rating Methods

  • Behaviorally Anchored Rating Scales (BARS)

  • Management By Objectives

  • 3600 Performance Appraisal

The International Society for Performance Improvement (ISPI) is an association dedicated to improving productivity and performance in the workplace. Founded in 1962, ISPI represents more than 10,000 members throughout the U.S., Canada, and 40 other countries. ISPI's mission is to develop and recognize the proficiency of its members and advocate the use of Human Performance Technology.

The International Public Management Association for Human Resources (IPMA-HR) represents over 7,500 HR professionals at the Federal, state and local levels of government. Founded in 1906, IPMA-HR provides information and assistance to help HR professionals increase their job performance and overall agency function by providing cost effective products, services and educational opportunities.

In recent decades, however, the process of managing people has become more formalised and specialised. Many of the old performance appraisal methods have been absorbed into the concept of Performance Management, which aims to be a more extensive and comprehensive process of management. Some of the developments that have shaped Performance Management in recent years are the differentiation of employees or talent management, management by objectives and constant monitoring and review. Its development was accelerated by the following factors:

    1. The introduction of human resource management as a strategic driver and integrated approach to the management and development of employees; and

    2. The understanding that the process of Performance Management is something that’s completed by line managers throughout the year – it is not a once off annual event coordinated by the personnel department.

Nowadays, great significance is being given to Performance Management, as companies incorporate them in their effective management strategies. However, a lot of people find this process a complicated one, mostly because of the many options that it offers - on the organization, a specific department/branch, a product or service, and employees, among others.

In order to minimize this confusion, the items below will give you a general idea of what Performance Management is all about as well as the activities that are involved in this process.

What is Performance Management?

Performance management is a process that provides both the manager and the employee (the person being supervised) the chance to determine the shared goals that relates to the overall goals of the company by looking into employee performance.

Why is it important?

Performance Management establishes an outline for employees and their performance managers to assess and to come to an agreement on certain concerns and aims that are in accordance with the overall structure of the company. This enables both parties to have clear objectives that would help them in their work and their professional growth.

Who conducts Performance Management?

Performance Management is carried out by those who oversee the performance of other people - work/team leaders, supervisors, managers, directors, or department chairs.

    • Many writers and consultants are using the term “performance management” as a substitution for the traditional appraisal system. I encourage you to think of the term in this broader work system context. A performance management system includes the following actions. Develop clear job descriptions.

    • Select appropriate people with an appropriate selection process.

    • Negotiate requirements and accomplishment-based performance standards, outcomes, and measures.

    • Provide effective orientation, education, and training.

    • Provide on-going coaching and feedback.

    • Conduct quarterly performance development discussions.

    • Design effective compensation and recognition systems that reward people for their contributions.

    • Provide promotional/career development opportunities for staff.

    • Assist with exit interviews to understand WHY valued employees leave the organization.

    • We have worked with some of the most advanced organizations in terms of Performance Management

Facts [+]

Employee assistance programs (EAP) are designed to resolve problems concerning health, marriage, family, finances, alcohol, drugs, law, stress or other things that may affect an employee’s work performance. EAP programs are usually provided at no cost to employees and their dependants.

The field of performance management can comprise two separate types of management. In one aspect of performance management, an analyst may view the performance of a company as a whole, and also evaluate the effectiveness of the managers and heads of companies in reaching goals. In another sense, performance management may be a system of evaluating employees to help them reach reasonable goals and thus ensure that the company performs better. This discussion will focus on the latter definition.

Performance management of individual employees differs. It generally includes the following:

  • planning work,

  • setting goals,

  • offering feedback and

  • reviews, offering opportunities to learn more in one’s field, and

  • rewarding employees who perform well.

Employee performance management works best when work is planned and goals are consistent. This may mean having a clear way to communicate regarding work expected at the moment and upcoming work. Planning also includes defining expectations of the employee so that he or she is not broadsided by evaluation criteria not included in planning.

Planning and setting goals in performance management also creates a system of predictable rewards for good performance, and consequences for poor performance. This way the employee can reasonably assume the consequences of work performance, whether good or bad.

Performance management also involves giving feedback to employees on a more consistent basis than the average annual review. Instead, an employee’s ability to exceed or failure to meet goals may be monitored on a monthly basis. This provides the employee with either the opportunity to receive compliments and rewards fairly regularly, or to make behavior changes sooner if performance is not up to par.

Often employees feel that end of the year reviews contain criticisms of work in the past year that were never openly discussed with the employee. The employee benefits from a more consistent model of performance management evaluation, since this gives a person time to address issues and change problem issues.

In a performance management model, employees must also be given ways to grow and develop in their field. This means giving opportunities to work on harder projects, pairing less-skilled employees with expert employees, and offering team models where employees can direct and make decisions. Greater responsibility and opportunities to advance in one’s field are essential to maintaining happy and productive employees.

Rewards are also a huge part of performance management. The greatest part of this is rewards of monetary nature, either in bonuses or raises, when employees perform well. As well, employees who actually are now qualified to work in a high level of their field should be placed in positions of greater responsibility, and receive a greater share of pay. Performance analysis should focus as much or more on positive performance than it does on negative performance. Rewards for positive performance must be real and tangible, or else the company runs the risk of becoming a “negative action” company only.

Employee performance management may be taught to companies who have difficulty maintaining performance of employees or who have a long history of unhappy employees and turnaround. Companies may hire experts in performance management to learn how to model its concepts.


The overall purpose of performance management is to contribute to the achievement of high performance by the organisation and its people. 'High performance' means reaching and exceeding stretching targets for the delivery of productivity, quality, customer service, growth, profits and shareholder value.

Specifically, performance management aims to make the good better, share understanding about what is to be achieved, develop the capacity of people to achieve it, and provide the support and guidance people need to deliver high performance and achieve their full potential to the benefit of themselves and the organisation.

Performance management is concerned with under-performers, but it does this positively by providing the means for people to improve their performance or make better use of their abilities.

An effective performance management system:A. Requires a shared responsibility between supervisor and employee.B. Clarifies and aligns performance objectives with university and unit goals and institutional values.C. Includes feedback and coaching concerning job performance.D. Identifies training and professional development needs.E. Measures and documents performance.F. Provides input for human resource decisions (e.g. compensation, recognition, etc.).

Facts [+]

People work an average of 45 hours a week but consider about 17 of those hours to be unproductive, according to an office productivity survey of more than 38,000 people in 200 countries conducted by Microsoft. The most common productivity barriers reported were unclear objectives, lack of team communication and ineffective meetings, followed by unclear priorities and procrastination.

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