Tutorial: Performance Management (cont. 2)

PERFORMANCE MANAGEMENT

Definition

PERFORMANCE MANAGEMENT is a system and process which links the organisation's goals and strategies to individual and team performance so as to increase organisational effectiveness.

It is a joint process that involves both the line manager and the employee who identify common goals, which correlate to the higher goals of the organisation. This process results in the establishment of written performance expectations later used as measures for feedback and performance assessment.

Performance Management is about providing direction, clarity and support to the work that employees do so as to optimise their effectiveness and efficiency in line with the needs of the organisation. It focuses both on objectives (the 'what') and on style and behaviours (the 'how'), so that it is possible to assess not only whether employees are achieving their individual objectives that have been set, but also whether their performance is in line with the organisation's preferred values and culture, e.g. teamwork, customer focus, interpersonal relationships, participative management style, etc. (doing the RIGHT THINGS in the RIGHT WAY).

The model below illustrates the four stages of Performance Management:

This model is aligned with the WORK NEEDS of individual employees, which are as follows:

To provide for the above needs of an employee, let's consider what should happen at each stage of the Performance Management Cycle:

1. Planning Performance: Performance objectives for individual employees (at all levels) are jointly discussed and agreed during one-on-one, face-to-face meetings between jobholders and their immediate line managers - normally for a period of 12 months. (Similarly, objectives could be set for whole work teams, provided that the team members are totally interdependent, working towards achieving the same goal/output, i.e. each team member contributes a portion towards it)

2. Managing Performance: During this stage the jobholder implements/executes the agreed objectives. He manages his own performance, assisted by his line manager who should remove performance obstacles in the work environment and provide the necessary resources, training and coaching. The line manager is also responsible for integrating and co-ordinating (horizontally and vertically) the objectives of all his employees/units/teams, monitoring and controlling their performance, taking corrective action, and doing joint problem solving as and when necessary. The leadership, feedback, reinforcement and support he needs to give them throughout, are of utmost importance.

Managing Performance is an ongoing, 12 months' activity that actually runs through all the phases of the Performance Management cycle. It is the golden thread of Performance Management.

3. Reviewing Performance: Times for formal Performance Reviews/Appraisals are decided by top management. Generally, 4 or 6-monthly formal reviews are sufficient. During these sessions, jobholders and their line managers discuss (and assess) how well the agreed objectives have been achieved. Problem areas are identified and corrective measures planned, including possible training that the jobholder needs.

4. Rewarding Performance: The actual rating of performance (how well each objective had been achieved) forms part of the Performance Review sessions. Rewarding people for good performance takes the form of monetary rewards (performance-related pay such as bonuses and/or salary adjustments). However, the power of non-monetary rewards, such as praise and recognition, should not be ignored and needs to enjoy much more emphases than it generally does.

In practice, Planning Performance and Reviewing Performance can take place during one session, called the PERFORMANCE INTERVIEW.

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