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Performance Management Systems

What is a Performance Management System?

Systems that facilitate the attainment of individual and corporate goals. Performance Management systems enable you to track and monitor the performance of individual employees, departments, and the organization overall.

These systems are often based on organizational and job specific competencies which need to be obtained for successful job performance.

The components included in Performance Management systems include:

  1. Lists of Accomplishments
  2. Goals and Objectives
  3. Results from 360-Degree Feedback Processes
  4. Supervisor Ratings
  5. Individual Development Plans

At HR-Survey, we can combine each of these aspects into a single assessment tool administered at one time or administered over a period of weeks (or months).

Effective Performance Management Systems:

  1. Are fair, consistent, and reliable
  2. Use established performance measures
  3. Supported by managers and executives
  4. Communicates performance expectations regularly
  5. Hold employees accountable for their actions
  6. Promotes continuous employee development
  7. Are flexible and efficient
  8. Aligns individual goals to the department and organization
  9. Seek to maximize employee performance
  10. Can be used for succession planning
  11. Links performance to compensation, rewards, and recognition
What are the responsibilities of the employees?
  1. Seek constructive feedback from others
  2. Engage in professional development activities
  3. Keep track of their performance throughout the year
  4. Conduct self-assessment
  5. Participate in an Individual Development Plan
  6. Develop effevtive and challenging goals
What are the responsibilities of managers/supervisors?
  1. Review the employee's performance in a timely manner
  2. Hold employees accountable for completing the process on time
  3. Provide feedback to the employee
  4. Recognize employees for their contributions
  5. Ensure rewards are fair
Effective Goals are (SMART):
  1. Specific
  2. Measurable
  3. Actionable
  4. Realistic
  5. Timely

How are Performance Management Processes used?

These processes are often administered on an annual basis. They can be administered as frequently as every 3 months (quarterly). The process is driven by documents such as Job Descriptions, position requirements, department goals and objectives. Performance measures such as units/costs/errors/productivity can be used for determining acceptable levels of job performance.

These processes can be used to determine compensation such as bonus/merit pay, variable pay, and/or pay raises. These processes can be used to reward and recognize employees for outstanding job performance.

New Advances and Use of Technology

Recently, the process of performance management has become more formalised and specialised through the use of computers. Not just in monitoring performance, but also in keeping track of measures, goals, and objectives. Also, computers are instrumental in gathering and collating information from a variety of sources. For example, the Performance Management Process may use information from individual job descriptions as criteria, combined input from 360-Degree Feedback surveys, and a Supervisor Appraisal form. These varied sources are all computer based and the Performance Management System can help collate and organize that information.

Performance Management Process
Traditional Performance Appraisal
  • Incorporates Criteria from Job Descriptions
  • Includes various measures of performance
  • Includes Self-Assessment
  • Includes feedback from Peers and Direct Reports
  • May require review by senior leadership and/or HR
  • Conducted Annually, quarterly, or may have components throughout the year
  • Uses objective measurable criteria
  • Administered by Supervisor
  • Standard Form that is common to all employees
  • Does not require review by others
  • Conducted annually
  • Criteria for evaluation may not match the employee's actual job duties or description
  • Criteria for evaluation may be vague and subject to interpretation and subjectivity
Objective: Performance Management Systems use objective and measurable criteria for assessing employee performance. Criteria that is specific to the individual being assessed.

Individual Performance vs Organizational Performance

With Performance Management Systems, an individual's job performance criteria may also include organizational performance measures. The organization's goals become part of the requirements for individual employees. Employees that achieve these goals are rewarded with positive reviews.

Incorporating 360-Degree Feedback into the process

In assessing an employee's performance, supervisors and managers may find it useful to consider the opinions of this person's peers and/or direct reports. Supervisors and managers could try to collect this feedback on their own by soliciting comments from others who work with this individual. It is possible, however, to incorporate the results of a 360-degree feedback survey directly into the Performance Management Process. This 360-degree feedback can include quantitative as well as text based feedback to help the supervisor get a better picture of the employee's job performance within the organization.