Performance management is the process of translating an organization's strategy into results by managing execution. It provides abilities like recognizing and developing talent, rewarding performance, linking work to objectives, and motivating employees. A performance management system delivers benefits like improved profitability through focus on key results, increased employee engagement, compliance through organized records, and higher productivity by removing paper processes. Reasons for performance measurement include improving the bottom line, aligning activities to strategic plans, identifying best practices, providing accountability, and allowing benchmarking against other organizations.

1. WHY PERFORMANCE MANAGEMENT?
Performance management (PM) is the process of managing the execution of an organization’s
strategy. It is how plans are translated into results.
Performance management can provide your business unit and the agency with the ability to:
 Recognize and develop talent
 Reward employees when they perform well
 Link everyday work activities to the agency’s overall objectives
 Provide an opportunity to communicate on a range of issues
 Provide opportunities for career and professional development, and
 Motivate your employees to work towards their goals.
Benefits that a best practice performance management system could deliver into
your business,
Profitability
Promotes year-round focus on key business results
 Enables recognition of high performance with or without aligned pay
 Reduces attrition and supports retention
 Allows optimization of training spend and results
 No capital expenditure required
Engagement
Improves clarity of role and focus on what is expected
 Increases accountability and empowerment through employee involvement
 Embeds and encourages best people management practice e.g. monthly 1to1’s and
regular appraisal
 Encourages feedback and recognition using social media driven approach
Compliance
Improves data protection and makes audit easy
 Records all employee meetings, evidencing use of process
 Logs and flags expiry dates for time critical qualifications
 Securely hosted, removing the need for local storage

2. Productivity
Removal of paper based processes and high administrative burden for HR
 Transitions objective setting from a once yearly ‘paperwork exercise’ to a way of working,
increasing focus on key business goals
 Performance reports available at a click of a button, saving time
 Aligns the whole organization to focus on key company objectives
 Increased visibility of individual high or low performance
Reasons for a Performance Measurement System
1. It improves the bottom line by reducing process cost and improving productivity and mission
effectiveness.
2. A performance measurement system such as the Balanced Scorecard allows an agency to align
its strategic activities to the strategic plan. It permits -- often for the first time -- real deployment
and implementation of the strategy on a continuous basis. With it, an agency can get feedback
needed to guide the planning efforts. Without it, an agency is 'flying blind'.
3. Measurement of process efficiency provides a rational basis for selecting what business
process improvements to make first.
4. It allows managers to identify best practices in an organization and expand their usage
elsewhere.
5. The visibility provided by a measurement system supports better and faster budget decisions
and control of processes in the organization. This means it can reduce risk.
6. Visibility provides accountability and incentives based on real data, not anecdotes and
subjective judgments. This serves for reinforcement and the motivation that comes from
competition.
7. It permits benchmarking of process performance against outside organizations.
8. Collection of process cost data for many past projects allows us to learn how to estimate costs
more accurately for future projects.