Managing the performance of the employees is one of the toughest challenges which the organizations are facing today as this completely depends upon the employee’s commitment, competence and clarity of performance. If managed efficiently through a well planned reward practice and feedback mechanism, a performance management system can serve as an important tool for employee motivation and development. The need for the introduction of a robust system of performance management was felt during the period when the traditional performance appraisal mechanism started failing and its limitations were surfacing up. The performance appraisal system of the earlier period was missing objectivity as the diameters or the parameters for measuring performance were not clearly specified and the focus was on traits instead on behaviors or measurable targets. As a result, the employee’s morale and motivation to work was adversely affected due to an absence of a transparent feedback mechanism and lack of employee involvement in the entire process of appraisal. A performance management system overcomes the drawbacks of the traditional performance appraisal system by maintaining a futuristic approach instead of assessing the past contributions of the employees for evaluating the performance of the employees.

Performance management is a strategic tool and is holistic in nature as it pervades in every activity of the organization which is concerned with the management of individual, team and the overall organizational performance. The process is indispensable and very important for an organization as it is concerned with establishing a culture in which the individuals and teams can excel by continuously improving in terms of skill sets and the business processes.

Overall Performance Management system of ABC System

The performance management system of ABC Company includes a variety of on-going activities. At the beginning of the process, each employee completes a self-assessment and identifies the goals or objectives they would like to work toward in the following appraisal period. The employee and their supervisor use the self-assessment to complete the performance appraisal and work together to develop challenging and achievable objectives. During the performance management process, developmental opportunities are also discussed and a plan for fulfilling training needs either internally or externally is created. Employees and their supervisors evaluate progress towards these objectives during bi-weekly meetings and at a midyear check-point. Employees are encouraged to address any obstacles preventing them from achieving their objectives at this time.

Alignment between business goal and performance management system

The alignment of strategies in a business is important to ensure that everybody is pulling in the same direction. Strategies are the offshoot of business goals and direction and are designed to give an indication to all members of the business of how the business will achieve its goals. Strategies must work together to be most effective. If people are pulling in different directions, resources will be wasted.

How performance management was conducted in the company

ABC Company used performance appraisals to manage and monitor the performance of staff. The process by which a manager or consultant examines and evaluates an employee’s work behavior by comparing it with preset standards, documents the results of the comparison, and uses the results to provide feedback to the employee to show where improvements are needed and why. Performance appraisals are employed to determine who needs what training, and who will be promoted, demoted, retained, or fired.


Last updated: Sep 2023

Page 1

where improvements are needed and why. Performance appraisals are employed to determine who needs what training, and who will be promoted, demoted, retained, or fired.

Formal and informal feedback procedure

Formal Methods of Feedback

  • Performance reports – performance reports are effective ways of measuring and monitoring performance and placing all the information into a report format. This helps both the managers and staff to know how their performance was and the areas of performance that can be improved.
  • Counselling – counselling is a very format method of feedback, normally provided to workers that seem to be struggling or unable to improve. Counselling is about getting open feedback and discussing more personal issues, which can help improve performance significantly.
  • Employee performance appraisals – performance appraisals are a little different to performance reports, as appraisal forms are generally used to measure the performance with key performance factors such as teamwork, motivation, dedication, etc.
  • Informal Methods of Feedback

  • Drop by conversations – managers, employers, supervisors, etc can all provide very simple and informal feedback to any workers. This may not be as effective as formal feedback, but it can be regular and great for solving less significant issues.
  • Informal meetings – informal meetings are meetings that are not too serious, however are used to discuss any issues, ideas or status reports. These are great for providing feedback because there are others that hear the feedback and therefore, can help monitor and manage the issues.
  • Emails – emails are generally not an effective way to provide detailed feedback, however emails can be good for giving informal feedback to a large number of people. emails require little planning and can be as detailed as you want it to be.
  • Performance Documentation System

    Performance documents for individual staff in ABC Company

    There are many requirements to performance appraisals, and many components are company or department-specific. However, there are a few items that must be included in each performance appraisal, regardless of the company, department, or position. The following items represent those components that are required.

  • Employee name
  • Manager name (and reviewer name, if different)
  • Date of review
  • Review period (typically, a calendar or fiscal year)
  • Job title, level, or position
  • Review instructions and evaluation criteria
  • Overall rating (typically, exceeds expectations, meets expectations, and needs improvement)
  • General feedback on performance to support the overall rating
  • Two to three specific examples to support the overall rating
  • Usage of Documentation for further improvement

    Performance appraisals are periodic assessments of…


    Last updated: Sep 2023

    Page 2

    You've reached the end of your free preview.

    Want to read all pages?