For many years organisations have been trying to improve productivity through the use of performance management. Given the global economic climate, pundits in both the public and private sectors have been utilising this technique to encourage employees to achieve the organisation’s goals.
However, for the number of years that performance management has been around several managers and supervisors still seem unsure of the importance of this process. More importantly, some managers seem not to make the connection between the performance management process, the organisation’s overall plans and employee motivation.
Far too many employees are unclear what this process is about and many often perceive it as a scheme for punishing those who are in the “out-group” while rewarding those who are in the “in-group”.
Only recently, an employee of a firm suggested that supervisors appear to openly display preferential treatment to what she referred to as “the chosen ones” while marginalising others that did not “dance to her tune”.
Another employee suggested that the whole performance “thing” needs to be abolished because it is not serving any useful purpose. She further explained that in her organisation everyone is given a favourable performance evaluation and yet several individuals are not performing at the required standard.
Additionally, she suggested that the supervisors and some employees were so closely knit, they were unable to discipline their “friends” while the other employees threatened retaliation should they be disciplined, so everyone gets a “fairly good” performance evaluation.
This defeats the purpose and cannot be allowed to continue and if it does the productivity of the overall organisation will plummet. The article this week is about the importance of performance management systems to organisational effectiveness.
Let me first dispel the belief that performance management is only about performance evaluations/ appraisals. Performance management is an entire process which should be designed to have a holistic view of the employees’ entire work environment.
This process begins with human resource planning, which takes place long before the employee is hired and ends with the exit interview. On no account should this process be used as a weapon or be perceived as such by employees, therefore it is essential that HR managers communicate the intricacies of this process to fellow managers, supervisors and employees alike.
According to the United States Department of Commerce, performance management “is the systematic process by which the Department … involves its employees, as individuals and members of a group, in improving organisational effectiveness in the accomplishment” of the … “mission and goals”.
In other words performance management underpins good communication practices together with well defined goals and objectives that encourage collaboration and active participation between management and staff in achieving the organisation’s objectives.
Moreover, performance management entails ensuring that all employees recognise that they are accountable for achieving individually set goals through tracking and evaluation of performance. This cannot be achieved alone so managers must design collaborative strategies where there is a combined effort and shared responsibility are developed. This approach would elevate the levels of organisational wide productivity. However, all of this cannot be achieved if the process is not clearly defined.
Performance management incorporates several other HRM processes these are: job analysis, job descriptions, performance appraisals, rewards and recognition, compensation, training and development and benefit policies.
These processes are not restricted and according to the type of organisation can be linked together to create a motivated and engaged employee. Unfortunately the space allocated for the article cannot accommodate a more detailed discourse about performance management. Therefore, the central focus here will be on performance appraisal systems.
The performance appraisal process has been described as historically the single most debated process carried out in organisations since management of people began. The views about its relevance and function are so diverse one can only imagine the confusion it has caused and will perhaps continue to cause if its purpose is not clearly defined and articulated (Wright, 2002).
It can even be argued that performance appraisals are often not perceived as a fair process by employees and hence can impact on employee engagement. Some suggest that it is important that managers maintain fairness when conducting performance appraisals so that employees, even though they may not agree with the outcome, would remain engaged (Maslach and Leiter, 2008).
Even though it is suggested that the performance appraisal should take place at least twice a year, there are some organisations that insist on performing this task on an annual basis. This would make it impossible for an employee who is not performing at the optimum level to change his or her approach in time to receive proper compensation.
This is most significant in organisations that base their compensation methods on the results of the employee’s annual performance appraisal.
Indeed there are some who are unaware that an appraisal system should be based on some set criteria and that it would only be successful if the employee who is evaluated knows the criterion upon which he is evaluated.
Moreover, the criterion should be explained and linked to the individual’s knowledge, skills and abilities. Besides, there must be some connection between the criteria, employee expectations and the goals of the organisation embedded in the appraisal system.
Currently, most performance appraisal systems are based on observation where records are linked to computerised out-puts that are set against a set standard. Although to some this may seem foolproof, it still sets the stage for a biased viewpoint by both the appraiser and person being appraised.
However, there is good news and this is that as managers continue to re-evaluate their methods of administering performance appraisals by utilising clear criteria and methods of reducing biases then and only then would employees perceive it as a fair method.
In summary, performance management should not be viewed as encompassing only one function but should be made clear to every employee that it incorporates other organisational wide processes that begins with HR planning and ends with the exit interview.
Underpinning this process is transparency, objectivity and effective communication skills with all concerned. In fact, managers should seek to ensure that the whole exercise be developed within a climate of trust and empowerment for the process to be effective.
If this is not ascertained, there will always be employees who perceive such systems as unfair and biased and who will feel powerless and develop low job engagement and high levels of dissatisfaction. Until next time…
* Daren Greaves is a Management & Organisational Psychology Consultant at Dwensa Incorporated. e-mail: firstname.lastname@example.org, Phone: (246) 436-4215