There is no credible denial that a well-functioning and appropriately implemented performance management system that is objective and comprehensive can deliver real, bottom-line business results. An efficient performance management system prompts and energizes people to take responsibility for their performance and should lead to the achievement of superior results. Indeed, winning organisations get their competitive edge from designing and implementing human resources systems that helps them hire talented people, place them in the right position, align their individual performance with the organisation’s vision and strategic objectives, develop their abilities and reward p
However, it must be noted that without open communication, cooperation and collaboration, a performance management system creates not only an atmosphere of fear and suspicion but it also breeds animosity and hostility
What is performance management? It is a means of getting better results by understanding and managing performance within an agreed framework of planned goals, standards and competency requirements. It is concerned with output(the achievements of results), outcomes( the impact made in performance ) the process required to achieve these results (competences) and the inputs in terms of capabilities (knowledge, skill and competence) expected from the teams and individuals involved (Armstrong and Baron, 2006).
Alternatively, a performance management system is a multi-faceted process that involves motivating employees through setting goals, measuring progress, giving feedback, coaching for improved performance and rewarding achievements.
There are a number of factors that enable the successful implementation of an objective performance management system that drives the overall performance of the business.
Proper Design The performance management system and tools must fit with the specific needs of the organisation. There is no way you can “copy and paste” a performance management system designed and implemented in another organisation, even an organisation in the same industry or the same business group. Intense consultation with various stakeholders and users of the system is necessary. User trust is an absolute necessity for the success of the system. The design should be tried out on a pilot basis before it is rolled out to the organisation as a whole. All documents and forms must be in place. The system should be fair and equitable. Performance management should be viewed as a continuous process and not an activity conducted once or twice a year. The design should also i
Integration and Alignment The performance management system must have a synergy with strategic planning, human resource management processes, organisational culture, structure and all other major organisational systems and processes. Individual, team, departmental and organisational goals must be aligned. So an attempt, whatsoever, by any organisation to design and implement the performance management system in isolation is an exercise in futility.
Leadership Commitment The top management must be seen to be investing not only their time and effort but also marshal the human and financial resources towards the design and implementation of the performance management system. Leadership commitment and support is a must for smooth implementation of the system. Leaders must drive the process and make performance management an integral part of the management of the company. Leaders contribute not only in setting the strategic direction and performance measures but also in monitoring and reviewing performance across the organisation. They also reinforce the performance cycle by recognising and rewarding performance. The entire performance management system must be understood and supported by the senior managers. The management responsibility at various levels needs to understand the contracting, measurement development and appraisal process very well and apply it consistently.
Change management strategy The change management aspect of performance management should be managed strategically. The organisation’s top leadership must drive the change process. Resistance to change should be managed proactively. A communication process should be put in place which will explain the benefits of the performance management system, communicate progress with the implementation and reduce uncertainties, fears and anxieties.
Competence Competence to use the performance management system is necessary to ensure smooth implementation of the system. All those involved in the performance management system must possess appropriate knowledge, attitudes and skills to utilize the system. The following are major skills required: development of performance indicators, key results areas, core management competencies and performance agreements, measurement of performance indicators, communication of results and feedback, monitoring and evaluation of the performance management system (Armstrong, 2010). Proactive training and development interventions should be implemented to ensure that the users of the performance management system are continuously developed.
A Reward System Whatever the case might be, humans are fuelled by money. So a performance management system must be designed in such a way that it is married to the organisation’s reward strategy. A reward system that rewards high performance and discourages low and mediocre performance must be put in place. A comprehensive and holistic reward system, which includes various rewards such as financial rewards, public acknowledgments, merit awards, promotions, greater work responsibilities, learning and study opportunities should be developed and communicated to staff. Greater emphasis must be given to non-monetary rewards. Mechanisms must be put in place to take corrective action against poor performers.
Communication Strategy A proactive communication strategy and process must be followed throughout the implementation of the performance management system so as to dispel the fears and confusion surrounding the design and implementation of a performance management system. In the planning and design phases, good communication will enable buy-in from the key stakeholders. Users of the system must be trained to communicate professionally and developmentally during the process of conducting performance appraisals and when communicating outcomes and feedback. Communication is one of the most critical success factors of the entire performance management system. Effective communication requires the provision of relevant information, ensures buyin from the users of the system, reduces resistance to change, and generates commitment to the system.
In the light of the above discussion I strongly believe that the issues I have raised are critical foundational stones for the design and implementation of an objective and comprehensive performance management system. Without a performance management system your organisation becomes a sanctuary for incompetent employees.
Newturn Wkirefu is the Talent Acquisition and Development Manager at Industrial Psychology Consultants email firstname.lastname@example.org or 0784587343