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Introduction to Performance
Management
Definition and rationale for performance
management
Background and scope of performance
management
Factors that influence performance
Performance management process
Ack Michael Armstrong
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What is performance management?
A strategic and integrated approach to bring
success to an organisation by improving the
performance of people and by developing
capabilities of teams and individuals
Strategic / integrated / performance
improvement / development
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Rationale for Performance
Mgt.
1. Creates a link between organizational
goals/objectives and the staff responsible for
implementing them. Information cascades
down.
2. Demonstrates commitment by the organization
and managers to staff in terms of interest and
time.
3. Enhances staff communication/morale
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Rationale cont…..
4. Encourages staff feedback on
situations and concerns; provides an
opportunity to highlight problems in
advance.
5. Obtains more objective information
on performance results for use in
business planning, promotion and
remuneration decisions.
6. Creates a climate for greater
individual and managerial
effectiveness, usually reflected in the
bottom line.
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Scope of Performance
Management
Performance Management is about managing
the organisation.
It is also about managing within the context of
the business(its internal & external
environment).This will affect how it is developed,
what it sets out to do and how it operates.
Performance management concerns everyone
in the business- not just managers.
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Scope of PM cont…
It rejects the cultural assumption that only
managers are accountable for the performance
of their teams and replaces it with the belief that
responsibility is shared between managers and
team members.
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Scope of PM cont…
The Holistic Approach to PM
The holistic covers every aspect and concerns
the organisation wholistically.It takes a
comphrehensive view of the constituents of
performance, how those contribute to desired
outcomes at the organisational, departmental,
team and individual levels, and what needs to
be done to
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Scope of PM cont…
improve these outcomes.
PM is based on the belief that everything that people do at
work at any level contributes to achieving the overall
purpose of the organisation. It is therefore concerned with
what people do(their work), how they do it (their
behaviours) and what they achieve(their results).
10. MZUMBE UVERSITYScope of PM cont…
PM as an Integrating Force.
(a) Vertical integration.
Integration is achieved vertically with the business
strategy and business plans and goals.
Team and individual objectives that support the
achievement of corporate goals are agreed.These take
the form of interlocking objectives from the corporate to
functional or business unit level and down to teams and
individual level.
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Scope of PM cont…
Steps need to be taken so that the goals are in
alignment.This can be a cascading process, i.e.
objectives flow from top to bottom. But it should
also be a bottom-up process, individuals and
teams being given the opportunity to formulate
their own goals within the framework provided
by the overall purpose and values of the
organisation.
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Scope of PM cont…
(b)Horizontal Integration
Horizontal integration means aligning PM strategies with
other HR strategies concerned with valuing, paying,
involving and developing people. It can act as a powerful
force in integrating these activities.
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Background to PM
The concept of PM has been one of the most important
positive developments in the sphere of HRM in recent
years.
The phrase was first coined by Beer and Ruh in 1976 but it
did not become recognised as a distinctive approach untill
the mid 1980s, growing out of realisation that a more
continuous and integrated approach was needed to
manage and reward performance.
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Background to PM cont…
All too often, crudely developed and hastily
implemented Performance Related Pay (PRP)
and appraisal systems were not delivering results
people expected.
PM has risen from the old-established but
somewhat discredited systems of merit rating
and MBO.
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Working at the factors
Personal motivation and
ambition
Knowledge and skills
Work environment
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Working at the factors
Personal motivation and ambition
Knowledge and skills
Work environment
Reward systems
Assessment
Clear goals
Fair appraisal
Development
Training
Needs analysis
Resources
Culture
Systems
Leadership
Teamwork
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The PM Process
The basic components of the PM process are
goal setting,performance
feedback,coaching,development,appraisal
and recognition. These components build on
each other.
Goal setting is the basis for the ongoing
evaluation of performance,performance
feedback,coaching, development and
recognition provided to enhance employee
performance.
Ultimately, the application of the formal
performance appraisal is to evaluate goal
achievement
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PM Process cont…
PM is not a fixed sequence of events but a
continuous process that is constantly renewing
itself as performance unfolds.
The elements of the PM process are not stand-
alone HR programmes.They are part of an
integrated system that is aligned with
organisational objectives.
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The PM Process cont…
The components of PM are also integrally linked. For
instance, consider the following relationships btn goal-
setting,feedback,coaching and appraisal:
Goals provide the standard for feedback and
performance appraisal;
Feedback leads to setting goals for development and
performance improvement;
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The PM Process cont…
Coaching helps to process feedback, set
meaningful goals, practice new behaviours and
track changes in performance;
Performance appraisal evaluates goal
attainment and is a basis for feedback;
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The PM Process cont…
Furthermore, ongoing feedback and coaching
focus attention on behaviours that contribute to
goal accomplishment and performance
improvement.
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Concerns of performance
management
Measurement and review
Outputs, outcomes, inputs, processes
Planning for future success
Continuous improvement
Communication
Stakeholders
Ethics - respect and fairness
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General Principles of the
programme
Human Resources are the most
important determinant of
organisational success
All managers and all organisations
should be concerned to get the best
from their staff
This programme considers some of
the problems and many of the
possible solutions
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General principles of the
programme
Management should look at how they
Define what qualities are needed by their
staff
Acquire and retain staff who have or will
develop those qualities
Encourage those qualities to be shown and
developed in the workplace
Editor's Notes
Strategic – facing broader issues as well as day-to-day problems
Integrated
vertically – co-operation between grades
functionally – between different classes of professionals
HR – all HR functions co-ordinated into one effort
integration between individuals and the organisation goals
Performance improvement – how well they do their jobs – implying motivation, energy, prioritising, outputs, as well as the application of skills
Development - the intention that everyone should improve their ability to perform in accordance with their ambition and abilities, and that teams should aim to improve.
Traditional approaches have assumed that variations in performance were attributable to personal factors, but this is increasingly seen as an over-simplified view. Appraisal of performance should take account also of other factors.
The quality of leadership and the strength of the team are critical in determining performance, as are many factors in the situation – quality of the equipment and systems, reasonable expectation and co-operation of customers, appropriate risk taking culture, encouragement of change and so on.
Also, the quality of the information management and the level of communication can affect both individual and team performance.
Performance management systems generally apply measures. Most commonly measures of output (what we have achieved) but also measures of input (our costs) or of efficiency of our processes (time taken to do things / error rates)
Also we should look to improvement in the future, as well as solving present problems. In a fast changing world the ability to anticipate is vital.
Our systems should demonstrate our values and beliefs, and reflect the views of stakeholders, so that our customers can identify with what we are doing.
