What is a Performance Management System
The process of directing and supporting employees to work as effectively and effectively as possible aligns with the organization's needs (Walters).
Importance of implementation of a Performance management system in an organization
| Employee |
Employer |
|
A great PMS system supports developing motivation and self-esteem, which helps to increase performance. |
A great system helps them to gain insight into employee's activities and goals. |
|
Will give a clear idea about the job tasks and duties. |
Help to make more fair and valuable administrative actions |
|
Describe the supervisor's expectation |
Help to address organizational goals and targets more clearly |
|
Provide self-insight and development opportunities to employees |
Identify the apparent differences between good and poor performances |
Literature Reviews
Image 1: Performance management cycle (Source:www.prismvs.com,2018)
Many organizations have systems labeled PMS, but usually, they applied for performance appraisal systems, performance appraisal emphasizes the assessment of an employee’s strengths and weaknesses and does not include strategic business considerations, and it does not include extensive and ongoing feedback that an employee can use to improve performance in the future, perhaps performance appraisal is a once-a-year event that is often driven by the HR department, whereas PMS is a year-round way of managing a business driven by managers (Pulakos, 2004)
Planning - Planning is an intellectual process of thinking restored to decide a course of action that helps achieve the organization's pre-determined objectives in the future. Innovative goal-setting process, deciding what needs to do, who is to do it, how it is to do, and when it is to do.
Monitoring - This is a systematic process of collecting, analyzing, and using the information to track a program's progress towards accomplishing its objectives and directing management decisions.
Developing - This is a process to increase the ability of people and organizations to manage a sustainable environment, good condition living, and what is needed
Rating and Rewarding - Rating and rewarding are usually doing during the employee’s annual performance appraisal. The employer staff members should recognize the performance of staff members. The process can be giving them praise, a raise, time off, recognition items or a Job promotion.
Globally, many organizations are adopted for the PMS in countries like Mexico, UK, the USA, France, Germany, Turkey, India, China, South Korea, Japan & Australia
Conclusion
To improve the overall performance of an organization, a performance management system will affect it straightly. PMS will be shared responsibility among the managers and team members. The process will be more effective when the team members are motivated and feel their involvement. The entire team will understand why their targets, goals matter to the co-workers and the organization.
References
Kumar B, P., 2021. Changing Objectives of Firms and Managerial Preferences: A Review of Models in Microeconomics.
Pulakos, E.D., 2004. Performance Management: A roadmap for developing, implementing, and evaluating performance management systems (pp. 1-42). Alexandria, VA: SHRM Foundation.
Aguinis, H., Suárez-González, I., Lannelongue, G. and Joo, H., 2012. Scholarly impact revisited. Academy of Management Perspectives, 26(2), pp.105-132.
van Vulpen, B. and Bock, B., 2020. RETHINKING THE REGIONAL BOUNDS OF JUSTICE: A SCOPING REVIEW OF SPATIAL JUSTICE IN EU REGIONS. Romanian Journal of Regional Science, 14(2).
Varma, A., Budhwar, P.S. and DeNISI, A.N.G.E.L.O., 2008. Performance management around the globe: introduction and agenda. Routledge. In Performance Management Systems (pp. 3-14).
It's great article. For me to gain an understanding, what kind of grading and rewarding suits for their employees do you recommend to organizations in Sri Lanka?
ReplyDeleteAn effective performance management system can play a very crucial role in an organization and can have a positive influence on the job satisfaction and employee loyalty. PMS ensure each employee understands what is expected from them and equally ascertaining whether the employees possess the required skills and support for fulfilling such expectations to improve organizational performance.
ReplyDeleteAgreed with your conclusion. According to Leonard & Cardy (2011) Performance management may be a crucial and necessary element for each individual and organizational effectiveness. In other words, a proper Performance Management system directly enhances the performance of employees.Good article.
ReplyDeleteUsually after the PMS, most of the employees are not happy with rewarding system. It is better to mention what are the management expect from employees rather than achieving KPIs. Because in today context, KPIs are not the only benchmark for PMS.
ReplyDeleteEffective performance management is essential for businesses. Through both formal and informal processes, it helps them align their staff, resources and programs to meet their strategic objectives. Organizations that acquire operational management rights become fierce competitive machines. The process of effective performance management aims primarily to coordinate your team, support staff development, and improve staff performance. It ensures that your organization, its departments, its employees, teams, and processes work towards the goals of the organization, throughout the year
ReplyDeleteGood informative post, my personal experience as a banker, in my organisation's all employees are covered by the performance based appraisal system in place which measures their performance with agreed quantitative and qualitative objectives which also serve to identify their training needs and readiness for career progression opportunities.
ReplyDeletea good performance management system will involve your employees in the process of setting organizational goals. It will also ensure that all objectives are aligned with the overall purpose of the organization. It is important that you and other leaders in your organization acknowledge the importance of performance management.Thanks for sharing
ReplyDeleteAccording to Armstrong, 1999 fundamental concern of performance management include:
ReplyDelete1. Aims to improve performance.
2. seeks to improve and develop employees.
3. seeks to satisfy the expectations of the various stakeholders in the organization.
4. Communication of importance in Performance Management objectives.
Thankyou for sharing Mihirani.
A healthy Performance Management System will help to
ReplyDelete*Improve individual and team efficiency.
*Utilizing worker abilities and skills to the fullest through successful guidance and feedback.
*Aligning organizational Behavior with the association's goals & objectives.
*Further developing Effective communication among workers and supervisors.
Hello Mihirani, you have clearly discussed the importance of PM and the process/cycle of the PM in your article.The reward and recognition of the employees can be a great benefit to the organization.Dedicated employees stay longer, are actively involved in the workplace and achieve better results. Improving employee engagement is essential to increase productivity and maximize return on investment. Performance management, when done well, is an important tool for having dedicated employees.
ReplyDeleteThis is a timely issue that can be applied to the current. A performance management system (PMS) can be used to track, analyze, and evaluate the performance of a single person, a team, or an entire enterprise. Team leaders can use this information for a variety of purposes, including establishing mutual purpose alignment, awarding high-quality work, and providing feedback.
ReplyDeleteThank you Mihirani for sharing a very informative topic.
PM is a very important management tool in all organizations. A proper PM includes regular feedback and the separation of interaction between managers and team members, allowing managers at all levels to identify performance gaps and how to resolve them as quickly as possible and keep everyone motivated to improve employee engagement, productivity and profitability. Nice article.
ReplyDelete