The report discusses performance management and defines it as a strategic approach to improving employee and organizational performance. It outlines the key aspects of an effective performance management process including setting clear expectations, regularly monitoring performance, providing feedback, evaluating results, and rewarding good performance. The goals of performance management are to increase communication, clarify goals and responsibilities, identify and address performance issues, and provide the basis for personnel decisions. An effective performance management system that engages employees can help an organization achieve its long-term and short-term goals.

1. INDUKAKA IPCOWALA
INSTIUTUTE OF MANAGEMENT
REPORT ON PERFOMANCE MANAGEMENT
Subject: HRM
Submitted to: Arpit Patel
Submission Date: 25/4/2012
Prepared by:
Kirtan Darji 11pgdm002
Robin Khristi 11pgdm003
Niraj Pandya 11pgdm004
Sapan Pandya 11pgdm005
Hardik Patel 11pgdm006
Ravi Patel 11pgdm009

2. Introduction
Performance Management is one of the key processes that, when effectively carried out,
helps employees know that their contributions are recognized and acknowledged.
Performance management is an ongoing process of communication between a supervisor and
an employee that occurs throughout the year, in support of accomplishing the strategic
objectives of the organization. The communication process includes clarifying expectations,
setting objectives, identifying goals, providing feedback, and evaluating results. An effective
performance management process sets the foundation for rewarding excellence by linking
individual employee work efforts with the organization’s mission and objectives, the
employee and the organization understand how that job contributes to the organization.
Performance management is an overall process which ensures the efficiency of the personnel
of the organization and achieving overall goals and objectives. Performance management
brings focus on overall results, measuring results, focused and ongoing feedback about
results, and development plans to improve results. The results measurements themselves are
not the ultimate priority as much as ongoing feedback and adjustments to meet results.
Defining performance management
Performance management can be defined as a strategic and integrated approach to delivering
sustained success to organization by improving the performance of the people who work in
them and by developing the capabilities of teams and individual contributors.
To perform well, employees need to know what is expected of them. The starting point is an
up-to-date job description that describes the essential functions, tasks, and responsibilities of
the job. It also outlines the general areas of knowledge and skills required of the employee an
employee to be successful in the job.
Performance expectations go beyond the job description. When you think about high quality
on-the-job performance, you are really thinking about a range of expected job outcomes, such
as
What goods and services should the job produce?
What impact should the work have on the organization?
How do you expect the employee to act with clients, colleagues, and supervisors?
What are the organizational values the employee must demonstrate?
What are the processes, methods, or means the employee is expected to use?

3. The range of performance expectations can be broad but can generally be
broken into two categories:
Results (The goods and services produced by an employee often measured by
objectives or standards)
Actions & Behaviours (The methods and means used to make a product and the
behaviours and values demonstrated during the process. Actions and Behaviours can
be measured through performance dimensions.)
Performance expectations serve as a foundation for communicating about performance
throughout the year. They also serve as the basis for assessing employee performance. When
you and an employee set clear expectations about the results that must be achieved and the
methods or approaches needed to achieve them, you establish a path for success.
Performance and Organization
Performance management is a means of getting better results from the organization, teams
and individuals by understanding and managing performance within an agreed framework of
planned goals, standards and competence requirements. An effective performance
management process sets the foundation for rewarding excellence.
By linking individual employee work efforts with the organization’s mission and
objectives, the employee and the organization understand how that job contributes to
the organization.
By focusing attention on setting clear performance expectations (results + actions &
behaviours), it helps the employee know what needs to be done to be successful on
the job.
Through the use of objectives, standards, performance dimensions, and other
measures it focuses effort. This helps the department get done what needs to be done
and provides a solid rationale for eliminating work that is no longer useful.
By defining job-mastery and career development goals as part of the process, it makes
it very clear how the current position supports employee growth and the additional
opportunities the employee needs to explore.
Through regular check-in discussions, which include status updates, coaching, and
feedback, it promotes flexibility, allowing you and the employee to identify problems
early and change the course of a project or work assignment.
By emphasizing that an annual appraisal should simply be a summary of the
conversations held between you and the employee during the entire cycle, it shifts the
focus away from performance as an ―annual event‖ to performance as an on-going
process.

4. An effective performance management process, while requiring time to plan and implement,
can save you and the employee time and energy. Most importantly, it can be a very effective
motivator, since it can help organization and the employee achieve the best possible
performance.
Performance management and long term goals
A clear mission statement understood by all employees
Continuous communication of organizational priorities, business plans and progress
Presence of systems focusing on quality improvement
Clear linkage between performance and rewards
Focus on performance of members of all levels
Existence of clear, continuously reviewed, performance standards
Presence of systems to foster high performance
Emphasis on fostering good employee relations
Performance management and short term goals
Specific
Measurable
Attainable
Relevant
Timely
Specific – Objectives and standards should let employees know exactly which actions and
results they are expected to accomplish.
Measurable – Whenever possible, objectives and standards should be based on quantitative
measures such as direct counts, percentages, and ratios.
Attainable – The objective or standard should be achievable, but challenging, and attainable
using resources available.
Relevant – Individual goals, objectives and standards should be in alignment with those of
the unit and the department in support of the University’s mission.
Timely – Results should be delivered within a time period that meets the department and
organization’s needs.

5. Performance Management Process
Employee performance management includes:
planning work and setting expectations,
continually monitoring performance,
developing the capacity to perform,
periodically rating performance in asummary
fashion, and
rewarding good performance.
The revisions made in 1995 to the Governmentwide performance appraisal and awards
regulations support sound management principles. Great care was taken to ensure that the
requirements those regulations establish would complement and not conflict with the kinds of
activities and actions practiced in effective organizations as a matter of course.
Additional background information on performance management can be found in the
following articles:
In an effective organization, work is planned out in advance. Planning means
setting performance expectations and goals for groups and individuals to
channel their efforts toward achieving organizational objectives. Getting
employees involved in the planning process will help them understand the
goals of the organization, what needs to be done, why it needs to be done, and
how well it should be done.
The regulatory requirements for planning employees' performance include
establishing the elements and standards of their performance appraisal plans.
Performance elements and standards should be measurable, understandable,
verifiable, equitable, and achievable. Through critical elements, employees are
held accountable as individuals for work assignments or responsibilities.
Employee performance plans should be flexible so that they can be adjusted for
changing program objectives and work requirements. When used effectively,
these plans can be beneficial working documents that are discussed often, and
not merely paperwork that is filed in a drawer and seen only when ratings of
record are required.
In an effective organization, assignments and projects are monitored
continually. Monitoring well means consistently measuring performance and
providing ongoing feedback to employees and work groups on their progress

6. toward reaching their goals.
Regulatory requirements for monitoring performance include conducting
progress reviews with employees where their performance is compared against
their elements and standards. Ongoing monitoring provides the opportunity to
check how well employees are meeting predetermined standards and to make
changes to unrealistic or problematic standards. And by monitoring continually,
unacceptable performance can be identified at any time during the appraisal
period and assistance provided to address such performance rather than wait
until the end of the period when summary rating levels are assigned.
In an effective organization, employee developmental needs are evaluated and
addressed. Developing in this instance means increasing the capacity to
perform through training, giving assignments that introduce new skills or
higher levels of responsibility, improving work processes, or other methods.
Providing employees with training and developmental opportunities encourages
good performance, strengthens job-related skills and competencies, and helps
employees keep up with changes in the workplace, such as the introduction of
new technology.
Carrying out the processes of performance management provides an excellent
opportunity to identify developmental needs. During planning and monitoring
of work, deficiencies in performance become evident and can be addressed.
Areas for improving good performance also stand out, and action can be taken
to help successful employees improve even further.
From time to time, organizations find it useful to summarize employee
performance. This can be helpful for looking at and comparing performance
over time or among various employees. Organizations need to know who their
best performers are.
Within the context of formal performance appraisal requirements, rating means
evaluating employee or group performance against the elements and standards
in an employee's performance plan and assigning a summary rating of record.
The rating of record is assigned according to procedures included in the
organization's appraisal program. It is based on work performed during an
entire appraisal period. The rating of record has a bearing on various other
personnel actions, such as granting within-grade pay increases and determining
additional retention service credit in a reduction in force.
Note: Although group performance may have an impact on an employee's
summary rating, a rating of record is assigned only to an individual, not to a
group.

7. In an effective organization, rewards are used well. Rewarding means
recognizing employees, individually and as members of groups, for their
performance and acknowledging their contributions to the agency's mission. A
basic principle of effective management is that all behavior is controlled by its
consequences. Those consequences can and should be both formal and informal
and both positive and negative.
Good performance is recognized without waiting for nominations for formal
awards to be solicited. Recognition is an ongoing, natural part of day-to-day
experience. A lot of the actions that reward good performance — like saying
"Thank you" — don't require a specific regulatory authority. Nonetheless,
awards regulations provide a broad range of forms that more formal rewards
can take, such as cash, time off, and many nonmonetary items. The regulations
also cover a variety of contributions that can be rewarded, from suggestions to
group accomplishments.
Where PM is applied
The PM approach is used most often in the workplace, can apply wherever people interact —
schools, churches, community meetings, sports teams, health setting, governmental agencies,
and even political settings - anywhere in the world people interact with their environments to
produce desired effects. Armstrong and Baron (1998) defined it as a ―strategic and integrated
approach to increasing the effectiveness of organizations by improving the performance of
the people who work in them and by developing the capabilities of teams and individual
contributors.‖
It may be possible to get all employees to reconcile personal goals with organizational goals
and increase productivity and profitability of an organization using this process. It can be
applied by organisations or a single department or section inside an organisation, as well as
an individual person. The performance process is appropriately named the self-propelled
performance process (SPPP).[citation needed]
First, a commitment analysis must be done where a job mission statement is drawn up for
each job. The job mission statement is a job definition in terms of purpose, customers,
product and scope. The aim with this analysis is to determine the continuous key objectives
and performance standards for each job position.
Following the commitment analysis is the work analysis of a particular job in terms of the
reporting structure and job description. If a job description is not available, then a systems
analysis can be done to draw up a job description. The aim with this analysis is to determine
the continuous critical objectives and performance standards for each job.

8. Benefits
Direct financial gain
Grow sales
Reduce costs
Stop project overruns
Aligns the organization directly behind the CEO's goals
Decreases the time it takes to create strategic or operational changes by
communicating the changes through a new set of goals
Motivated workforce
Optimizes incentive plans to specific goals for over achievement, not just business as
usual
Improves employee engagement because everyone understands how they are directly
contributing to the organisations high level goals
Create transparency in achievement of goals
High confidence in bonus payment process
Professional development programs are better aligned directly to achieving business
level goals
Improved management control
Flexible, responsive to management needs
Displays data relationships
Helps audit / comply with legislative requirements
Simplifies communication of strategic goals scenario planning
Provides well documented and communicated process documentation
Objectives
The objectives of Performance Management are to:
1. Increase two-way communication between supervisors and employees
2. Clarify mission, goals, responsibilities, priorities and expectations
3. Identify and resolve performance problems
4. Recognize quality performance
5. Provide a basis for administrative decisions such as promotions, succession and
strategic planning, and pay for performance.

9. Conclusion
Performance management is concerned with communication and involvement. It creates
acclimate in which a continuing dialogue between managers and the members of their teas
takes place to define expectations and share information on the organization’s mission values
and objectives. Like all other systems, performance management systems require continuous
review and change. Every change and corporate goals or strategies requires modifications in
operational priorities while changes in technology or workforce characteristics necessities
new ways of working. This means that a performance management system should evolve in
response to emerging priorities. A vision of an organization is the main concern, and the
employees are the individuals who give a view of the goal. If the overall performance of the
organization is systematic and concerned only then it can achieve its long term and short term
goal with high efficiency and effectiveness.