concept of performance management

1. Concept of Performance management
Performance management is a means of getting better result from the
organisation, teams, and individuals by managing performance in line
with the organisational strategy.
It requires :
 Know what priorities managers and their employees should be
focusing on;
 Having clear targets and goals that focus on priorities
 Measuring actual performance against agreed targets and goals
 Identifying and remedying performance problems

2.  Some definition of Performance Management are as follow :
 “Performance management may be defined as a planned and
systematic approach to managing the performance of individuals
ensuring their personal development and contribution towards
organizational goals”
 “Performance management is an organizational process in which the
performance of an individual, a team, a department, or a company is
evaluated as part of collective progress”
 “It is executed by monitoring each unit of an organization and
coordinating it effectively and efficiently to achieve its objectives in
the best possible way”

3. • Google: This tech giant uses a combination of peer reviews, self-assessments, and
manager feedback to evaluate employee performance. They use a rating scale of
1 to 5 to measure how well employees meet their objectives and demonstrate
Google’s values. They also have a system called OKR (Objectives and Key Results),
where employees set quarterly goals that are aligned with the company’s vision
and mission.
• Netflix: This streaming service has a culture of radical candor, where employees
are encouraged to give and receive honest and constructive feedback. They use a
360-degree feedback system, where employees can solicit feedback from anyone
in the organization, regardless of their level or role. They also have an annual
talent review, where managers discuss the performance and potential of their
team members and decide who to reward, develop, or let go.
• Accenture: This professional services company has eliminated annual
performance reviews and ratings in favor of a more agile and personalized
approach. They use a digital platform called Performance Achievement, where
employees can set goals, track progress, request feedback, and access learning
resources at any time. They also have regular discussions with their managers
and mentors to align their goals with the company’s strategy and identify their
strengths and areas for improvement.

4. • Performance management is important for the following reasons:
• It helps employees and managers align their goals and expectations, which can
improve communication, collaboration, and productivity.
• It provides feedback and recognition to employees, which can enhance their
performance, motivation, and satisfaction.
• It fosters a culture of learning and development, which can increase the skills,
knowledge, and competencies of employees.
• It supports the achievement of organizational objectives and vision, which can
lead to better outcomes, quality, and innovation.
• Builds the intellectual capital not only at managerial level but at front line level
also.
• Helps in making shift from industrial relation to individual relation with a focus for
employee growth and development.
• Helps employee to attain their full potential and attain a balancebetween work
and personal life.

5. Performance Management Cycle
• Every organization seeks to maximize the performance of its employees to
achieve their goals. And to achieve these, there needs to be a system that will
allow managers to monitor, guide, train, and motivate employees.
• This is done through a concept known as a performance management cycle. We
can break down the performance management cycle into four different stages.
They include;
• planning,
• monitoring,
• developing and reviewing,
• and rating and rewards.

6. • What is a Performance Management Cycle?
• A performance management cycle is a continuous process of planning,
implementing, measuring, and analyzing employee performance. It works
towards the achievement of holistic performance management by aligning
employee success with that of the organization.
• Why is a Performance Management Cycle Important?
• Builds Strong Relationship
• One of the objectives for implementing a performance management cycle is
is to get the employees to see the bigger picture of their goals. Being part of
of the planning process and being constantly given feedback improve
engagement. This can help build trust and foster a stronger relationship
between employees and management.
.

7. • Keep Employees Engaged
• Reduce Turnover
• High employee turnover is always a nightmare situation for employers. It costs employers to hire a
a new person, and the vacant space can also lead to a potential loss of revenue. Adopting a
performance management cycle plan will help because there will be defined goals, regular
feedback, support for career development, rewards and incentives, and a career path within the
organization. All of this will give employees the idea of an organization that cares.
• Help Detects and Fix Problems Faster
• The monitoring aspect of the performance management cycle helps organizations find problems
faster and potentially solve them. The problem may be an underperforming employee, an
overbearing manager, or the unrealistic nature of a set goal. If left unsolved, it can affect the
productivity of an employee or a team. The performance appraisal cycle can help nip the problem
sooner rather than later.

8. • Improves Performance
• Businesses with laid out objectives and plans always set themselves up
up to achieve them. The performance appraisal cycle allows
organizations to plan, monitor, and review their set goals and achieve
them. Employees have to take regular feedback and continuously
improve themselves to keep up with their objectives. Doing this helps
them stay in line with the organizational goal, which improves
performance.

9. 4 Stages of Performance Management Cycle
• The performance management cycle encompasses the following four
stages:
• Planning
• Monitoring
• Developing and Reviewing
• Rating and Rewards

11. • Planning
• Planning is the first act an organization will have to undertake. Management must first strategize
on the goals the company wants to meet in the first place before meeting with employees and other
team members to assign goals to them. After there is a clarity on the pact of the organization, then
management can set personal goals, targets, and specific objectives for teams and employees.
• While planning employees’ goals, managers can apply the SMART framework for efficient goal-
setting.
• Specific: The goal should be well defined. It should be clear and not ambiguous.
• Measurable: The goal should have measurable indicators to help the employees monitor their
progress. There should also be a clear start and an end.
• Achievable: While it’s good to challenge employees when setting goals, it’s wise to make the goals
reasonably obtainable. It may mean taking employees through a training and development program
to equip them.
• Relevant: The goal must apply to the individual’s job and the organization’s goals.
• Time-bound: The goal must have a deadline. It’s not a goal if there is no set deadline to achieve the
required result.

12. • Monitoring: In the performance management cycle model, monitoring is a key function in
achieving the goals set out in the planning stage.
• Managers and supervisors are to monitor the goals continuously. To ensure the employees are on
target to achieve their goals. There needs to be constant follow-up and feedback to iron out any
issues and provide support.
• Developing and Reviewing
• Towards the end of the cycle, the management does a review. If the manager or supervisor worked
worked well with the employee in the first two cycles, then the third one should be nothing more
than a formality between the manager and employees. Development entails looking at the cycles
before and asking these questions:
• If the employee had the required skill set to perform their duty?
• How much had they learned from their experience?
• Was the training assigned at the beginning of the cycle of use in completing the task?
• What other skills should they look to learn?
• The aim of the development aspect of the third cycle is to gauge how well they have developed and
and what further training they will need to improve.

13. Rewarding: The final stage of the performance management
cycle plan is the reward. This is a stage that cannot be
overlooked, as it is the one that is the most important for
employee motivation.
• Employees who do not receive a proper reward after a year of
striving to meet organizational goals, and succeeding in doing
so, will lose motivation for the next year. They might lose faith in
their organization, feel that their talents are not appreciated, and
begin searching for another job.
• When management fairly rewards employees and gives them
recognition for their efforts, they are ensuring that those
employees will continue to work hard to achieve organizational
goals.

14. These rewards should be merit-based. Employees will recognize who
amongst them has put in the effort, and if they see colleagues rewarded
without cause, they could lose motivation. Conversely, when employees
see a high-performer get a handsome reward, it demonstrates the value
in putting in that extra effort.
• Some rewards that might be offered are:
• An increase in compensation
• A one-time bonus
• Increased vacation time
• Special projects
• A promotion
• A positive written review
• Company-wide acknowledgment

15. • After the reward stage of the performance management cycle
model, the management team and the employee can choose to
meet one final time, to review the cycle as a whole. This is a
chance to bring up any issues that might have arisen, and begin
talks about the next year’s goals.
• Then the cycle begins a new.

16. Scope of Performance Management
• The scope of performance management encompasses a range of activities and processes aimed at
maximizing the effectiveness and efficiency of individuals, teams, and organizations. It includes:
1.Goal Setting: Establishing clear and specific performance goals and objectives for employees or
teams to work toward.
2.Performance Planning: Developing plans and strategies to achieve the defined goals, including
setting expectations, defining roles and responsibilities, and allocating resources.
3.Performance Monitoring: Continuously tracking and measuring progress toward goals, often
through regular assessments, feedback, and key performance indicators (KPIs).
4.Feedback and Coaching: Providing constructive feedback and coaching to employees to help
them improve their performance and develop their skills.

17. 5.Performance Appraisal: Conducting periodic reviews or
appraisals to assess individual or team performance against
predetermined objectives.
6.Development and Training: Identifying training and
development needs and implementing programs to enhance
skills and competencies.
7.Performance Recognition and Rewards: Recognizing and
rewarding high performers through incentives, bonuses,
promotions, or other forms of recognition.
8.Performance Improvement Plans: Creating and implementing
action plans to address underperformance and help individuals or
teams improve.

18. • Performance management skills
• To become a performance manager or implement a successful
performance management plan in a organization, it's important
to develop performance management skills.
• Here are some necessary skills for performance managers:
1. Leadership skills: Performance managers act in a managerial
capacity, so it's essential for them to have good leadership skills.
This can help them coordinate employees under their
management and help them reach the objectives they've
established for them

19. • Organising skills: It's important to have good organisation skills when managing
employee performance. This is because it can involve various tasks, such as assigning goals,
tracking progress and monitoring performance. These skills can also help you priorities tasks and
use your time effectively.
• Communication skills: An important part of performance management is
communicating expectations to employees, offering guidance and providing tailored feedback. It's
also the performance manager's job to relay information to upper management and ensure
employees understand how their work contributes to meeting organizational goals. For these
reasons, strong communication skills are essential.
• Problem-solving: Finding ways to improve employee performance and ensuring staff
members meet the expectations of their organisation is a form of problem-solving. Conflict
resolution also involves solving problems and determining the best way to address a situation, so
these skills are important for performance managers. Good problem-solvers may overcome
performance issues by devising strategies to address them.

20. Performance Management Framework
• a comprehensive performance management system that has the following
components:
1.Planning – Setting performance goals and behavioral expectations
1. Key result areas
2. Key performance indicators
3. Clearer competencies, behavioral indicators and standards
2.Monitoring – Creating mechanisms for regular monitoring of performance
and giving feedback
1. Score Cards and Dashboards
2. Feedback mechanism

22. 1.Developing–Clarifying managers’ responsibilities for developing capacity for performance
through coaching and training
1. Performance discussion and coaching tactics
2. Maximizing effect of training on performance
2.Appraising–Establishing tools for auto-generating key performance indicators for
performance evaluation and equipping managers to handle performance discussions more
effectively.
1. Auto generating scores for key performance indicators
2. Techniques for more objective appraisal of competencies
3. Performance Appraisal discussion techniques
3.Rewarding–Establishing policy for more effective use of rewards to reinforce positive
performance.
1. Migrate to a new rewards system that reinforces and encourages consistent positive
performance.

23. What are Employee Assessments
 Employee assessments are a process by which an employer
evaluates an employee’s skills, abilities, and performance.
 The purpose of the assessment is to identify any areas in which
the employee may need additional training or development in
order to be successful in their current or future role.
 The assessment may also be used to identify any potential
issues that may need to be addressed, such as poor
performance or misconduct.
• Employee assessments are usually done for compensation
review, performance improvement, promotions,
terminations etc.
•

24. • An Employee Assessment System is a structured and
systematic process used by organizations to evaluate and
measure the performance, skills, competencies, and overall
development of their employees.
• It serves multiple purposes, including performance
management, feedback collection, skill development, career
planning, and decision-making.

25. components and functions of an
Employee Assessment System:
• 1. Performance Appraisals:
• Performance appraisals are a fundamental component of employee
assessments. They typically occur on a regular basis (e.g., annually
or semi-annually) and involve managers evaluating an employee's
job performance.
• Goals, expectations, and key performance indicators (KPIs) are set,
and employees are assessed against these benchmarks.
• Feedback is provided to employees, helping them understand their
strengths, weaknesses, and areas for improvement.
• Example: An annual performance review meeting where a manager
discusses an employee's accomplishments, areas needing
improvement, and future goals.

26. • 2. 360-Degree Feedback:
• 360-degree feedback involves collecting feedback from multiple
sources, including peers, subordinates, managers, and self-
assessments.
• This method provides a well-rounded view of an employee's
performance and behavior.
• Example: Anonymous surveys where colleagues rate an employee's
teamwork, communication, and leadership skills.
• 3. Key Performance Indicators (KPIs):
• Organizations use KPIs to measure and assess specific metrics or
targets related to job performance.
• KPIs can vary widely based on the role and department, such as
sales targets, project completion rates, or customer satisfaction
scores.
• Example: A sales representative's KPI may be achieving a certain
revenue target each quarter.

27. • 4. Self-Assessment:
• Employees are encouraged to assess their own performance,
strengths, and weaknesses.
• Self-assessments provide employees with an opportunity for
self-reflection and self-awareness.
• Example: Employees filling out a self-assessment form detailing
their achievements and areas they feel need improvement.
• 5. Manager Assessments:
• Managers play a critical role in assessing and providing
feedback to their team members.
• They evaluate job performance, monitor progress toward goals,
and offer guidance and support.
• Example: A manager conducting regular one-on-one meetings
with their employees to discuss performance and career
development.

28. 6. Continuous Feedback:
• In addition to formal assessments, continuous feedback
involves ongoing, informal discussions between employees and
managers.
• This promotes real-time communication and adjustment of
goals.
• Example: Weekly or monthly check-ins to discuss project
progress and provide feedback.

29. 7. Data Collection and Analysis:
• Employee assessment data is collected through various methods,
such as surveys, interviews, and performance metrics.
• Data is analyzed to identify trends, patterns, and areas that require
attention.
• Example: Using software tools to gather and analyze employee
feedback data.
8. Employee Development:
• Assessment results are used to create individualized development
plans.
• These plans may include training, mentoring, coaching, and
opportunities for skill enhancement.
• Example: An employee identified as needing improvement in
leadership skills is provided with leadership training programs.

30. • 9. Decision-Making:
• Employee assessments help organizations make decisions
related to promotions, salary adjustments, and workforce
planning.
• Objective assessment data is often used in making these
decisions.
• Example: An employee who consistently exceeds performance
expectations may be considered for a promotion.
• In summary, an Employee Assessment System is a
comprehensive approach to managing and developing
employees within an organization. It involves various
assessment methods, feedback mechanisms, and data-driven
processes to improve performance, align employees with
organizational goals, and support their career growth and
development.

31. What are the benefits of Employee
Assessments?
• Employee assessments offer a variety of benefits for both employers and
employees.
• For employers, assessments can help to improve employee productivity,
identify training needs, and assess employee fit for specific roles. They
can also help to reduce turnover rates and improve communication within
the organization.
• For employees, assessments can provide feedback on their strengths and
weaknesses, identify opportunities for growth, and help to match them with
roles that are a good fit for their skills.
• In addition, assessments can help employees to develop a better
understanding of their own strengths and weaknesses, which can be
helpful in making career choices.

33. • Deloitte Saved 2 Million Working Hours per Year with Weekly Employ-
ee Check-Ins
• In 2015, Deloitte was the first big name to announce it was scrapping
once-a-year performance reviews, 360-degree feedback and objective
cascading. This change occurred after the company calculated these
processes were consuming a remarkable two million hours a year across
the organisation.
• Deloitte’s new performance management process requires every team
leader to check in with each team member once a week to discuss near-
term SMART goals and priorities, comment on recent work and provide
coaching. The check-ins are initiated by the team members, rather than
the team leaders to ensure these check-ins take place frequently. This also
serves to give employees a sense of ownership over their work, role
and time.
• These weekly employee check-ins are supported by quarterly reviews
when team leaders are asked to respond to four future-focused statements
about each team member. Rather than asking team leaders what they
think of the team member — which is what traditional performance ratings
do — they ask what the team leader would do with the team member.

34. • Case Study: Improving Employee Performance at XYZ
Corporation
• Background: XYZ Corporation is a medium-sized
manufacturing company facing challenges in managing
employee performance. The company has experienced a
decline in productivity and increased turnover over the past
year. The management recognizes the need to implement
effective performance management strategies to address these
issues.
• Case Scenario: In an effort to revamp their performance
management system, XYZ Corporation introduced a new
approach. They implemented regular feedback sessions, set
clear performance goals, and encouraged continuous skill
development. However, they faced challenges in monitoring
progress and ensuring that employees were aligned with
organizational objectives.

35. • Questions:
1.What were the initial challenges faced by XYZ Corporation in
managing employee performance, and how did they address them?
2.Answer: XYZ Corporation initially struggled with declining productivity and
increased turnover. To address these issues, they introduced regular
feedback sessions, clear performance goals, and encouraged skill
development.
3.What methods can XYZ Corporation employ to effectively monitor
employee performance and ensure alignment with organizational
objectives?
4.Answer: XYZ Corporation can use key performance indicators (KPIs),
conduct regular performance reviews, and establish a system for
continuous feedback to monitor employee performance and ensure
alignment with organizational objectives.
5.How can XYZ Corporation measure the impact of their revamped
performance management system on overall business performance?
6.Answer: To measure the impact, XYZ Corporation can analyze
productivity data, employee turnover rates, and feedback from employees
to assess the effectiveness of their performance management system in
improving business performance.