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Performance management importance
What is the importance of performance assessment
Performance management importance
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Performance Measures & Balanced Scorecards Almost every company that exists utilizes a type of performance measure to evaluate and gauge the company’s overall effectiveness. However, over the years there has been many questions raised regarding performance measures and how it affects an organization. Theoretical questions were raised, for example, companies were not sure of what to measure or how to measure performance effectiveness. In addition, questions were raised on how to define different job elements and how to connect those job elements in with the company’s overall assessment process, which included the company’s goals, objectives, and functions (Matthews, 2011). Background Matthews (2011) researches how performance measures …show more content…
The performance measurement allows companies to evaluate how well their employees are performing, in addition, to allowing companies to measure their overall short and long-term company objectives. Companies will typically recognize performance measures that are associated to the company’s overall vision, goals, and objectives (Matthews, 2011). A company develops good performance measures by ensuring they are well balanced, they should include both financial and nonfinancial measures. Good performance measures should be associated with the organization’s overall strategies, in addition, good performance measures should be flexible, this way they are able to be changed with ease. Furthermore, good performance measures are typically timely and accurate, simple to understand, and focus on constant improvement. Lastly, a company with good performance measures, align with the acronym SMART. SMART performance measures have a Specific purpose, are Measureable, are Achievable, Relevant, and Time based. Companies have found creating performance measures utilizing these key focal points have improved the company’s overall effectiveness. (Matthews,
Tapinos, E., Dyson, R.G. & Meadows, M. (2005). The impact of performance measurement in strategic planning. International Journal of Productivity and Performance Management, 54(5/6), 370-384.
Performance metrics can be seen as a guide to assist organizations in providing specific performance goals and activities (Cross, 2016). Performance metrics also has been said to drive up productivity and can provide specifics to performance goals. Metrics can be in regards to customer service, financial and operational goals. The author also suggests that metrics be implemented with a time which makes meeting performance goals attainable but short enough for employees to realize the urgency of the task to be completed (Cross, 2016). It is also suggested that performance metrics should include milestones that would serve as a took to track progress towards goal completion.
The Balanced Scorecard has emerged in recent years as a performance measurement system in various organizations. This paper will discuss the origin and concept of the balanced scorecard and how it was first implemented. We will then review the criticisms on the balanced scorecard methodology as well as analyse the strengths and weaknesses of this performance measurement tool.
Preview: This book provides a lengthy indoctrination of the what and why of performance management. This summary will cover both the pragmatic and practical pieces of the text; while excluding some of the specific instruction for those who oversee the overall orchestration of performance management in the workplace. The purpose of this paper is to allow its readers to grasp some main themes of performance management and develop a vocabulary for discussion and debate of the topic.
Performance management is a management tool used to value, monitor and measure a company’s strategies that ensure the efficiency and effectiveness of its product delivery. This management tool does not focus on the organisation and on its employees as well as stakeholders. It is a continuous process that entails that managers make sure that organisational and employee values are corresponding (Aguinis, 2005,p.1/2-1/5). Performance Management brings about the competencies in the employees, increases self-esteem by giving feedback to employees, there is a low number of lawsuits because it helps understand the company better (eThekwini Municipality, 2008,p.10-11). According to Pride, Hughes and Kapoor (2011, p.288) performance management creates motivation for employees; one theory of motivation is of Expectancy, which stipulates that employees satisfaction is driven by expectations of what an organisation will offer in return.
Performance is achievement of the organization in relation with its goals. Performance measurement systems play a key role as a source of information about financial outcomes and the internal operations shown in the firm’s financial statements (Yeniyurt, 2003)
Performance measures have been a widely accepted managerial practice that has become a central and indispensible part of human resources management for many organisations, (Cole 2010). The overall goal of performance measurement is to ensure that all of the subsystems within the entity are working to optimum efficiency to achieve the goals outlined by the organisation (Castka, Bamher & Sharp 2003). Performance measures have been widely implemented and there is a commonly held belief amongst organisations that view performance measurement as an accurate and efficient way of linking rewards to organizationally desirable values. Additionally there is a perception amongst organisations that see performance measurement as an effective way of increasing efficiency and the human capital of the entity, (Cravens 2010). For this reason interest surrounding the use of performance measures has increased considerably over recent years and research has revealed that while measuring performance accurately, is vital and has played its part in the success of many organisations, it also suffers form significant drawbacks. These drawbacks include the biased nature of obtaining the data, reducing employee motivation and creating a stressful work environment where employees are driven to fulfill only qualitative goals.
Performance management is a great tool for both the employee as well as the organization. For the employee, it gives the employee a clear picture of his areas of improvement and helps him improve and grow. From the organization’s perspective, it lets them understand the potential they have in their employees and how to realize them. It helps them to analyze who are worthy of being held onto and whom to let go so that the organization grows. In all, an effective tool, if used in the correct manner by all the parties involved.
Considering the fact that knowledge of a position is fundamental to the creation of a performance management system in association with an understanding of the strategic direction of the organization, a vital component of the foundation of the performance management system, job analysis, is lacking in Balme Library (Aguinis, 2013). The job analysis provides an organization with an understanding of the knowledge, skills, and abilities (KSA) that are required to adequately perform a specific position (Aguinis, 2013). The job analysis is a systematic exploration of a position, of the skills, resources, abilities, knowledge, and education needed to perform a position (Human Resource Management, n.d.). A job analysis also serves as a basis for the development of a j...
Introduction Performance management is the process of establishing a favorable working environment for a given organization such that every employee will have the ability to work at their level best to achieve the organizations goals and objectives. This process basically involves developing clear job description, acquisition of proper work force, providing appropriate training of employees and designing equitable compensation plans along promoting career development for the employees. Managing performance in any given corporate body is one of the most important contributions that managers should put into consideration. Setting up goals, laying down objectives and strategizing on appropriate methods to achieve such goals are the main essentials
Performance management is a useful and powerful tool that can be used by managers to identify what areas of their organisation they need to improve to increase the organisation’s overall performance. The idea of a balanced scorecard enforces a sensible distribution of resources and effort across all aspect of performance an organisation is, or should be, concerned with.
Organization is a group of people brought to gather to achieve specific goals. Goals can be achieved if team member are performing well. Performance is the results of activities given to the employees in an organization to be achieved within specific period of time. Evaluating the current performance of employees against past performances and organizational standards is known as Performance Appraisal (Dessler, 2005). Furthermore performance appraisal helps the company know how individual employees are performing and how to improve their performance thus improving the performance of the company (Grubb, 2007). A performance appraisal is propose in which the performance management system in an organizations set work goals, determine performance standards, provide performance feedback, determine training and development needs and distribute rewards as well as evaluating an employee’s job performance during a period of time. The performance of team member is much more than appraising individuals’ works, it is managing the business, so the performance of an employee is influences by the performance of an organization. It is target to achieve the best results for the planned strategic by managing activities of employees. There are many different opinions on the performance appraisals, some organizations do performance appraisals without any aim just follow others., where some organizations do performance appraisals to make sure they have a record of a piece of paper in the employee’s file – they are careless about do corrective action. But successful organizations understand the importance of combining performance appraisals into their performance management process and strategy plan as the success of any organizatio...
There are several reasons organizations initiate performance evaluations, however the standard purpose for performance evaluations is to discuss performance expectations; not only from the employers perspective but to engage in a formal collaboration where the employee and the manager are both able to provide feedback in a formal discourse. There are many different processes an organization should follow when developing its performance evaluation tool; in addition essential characteristics that must accompany an effective performance appraisal process. I will discuss in detail the intent of a performance evaluation, the process an organization should follow in using its performance evaluation tool, along with the characteristics of an effective
Performance management is a continuous process that creates a working culture to encourage employees to improve their work performance and reach their full potential during their stay of employment. Performance Management also provides strategic direction, develop competency in employees and instill organization value. This paper will identify methods and affects that performance management plan has on the organization and their employees.
Performance Management is a critical component to organizational success. However, creating, developing, and maintaining a system that captures all the characteristics of an ideal performance management system should involve an ongoing collaboration between leadership and employees to achieve a successful outcome. After all, the performance and success of the organization is dependent upon the employees. Therefore, performance management should incorporate organizational goals, employee goals, and continuous feedback that reflect individual’s contribution (NorthCoast 99, 2012).