According to Armstrong & Taylor, (2014), Performance management is a method of improving results by enabling people to perform well within an agreed framework of planned goals, standards, and competency requirements. It entails developing a shared understanding of what is to be accomplished and how it is to be accomplished.
Evolution of Performance Management
Performance
management processes have emerged in recent years as a means of providing a
more integrated and continuous approach to performance management than previously
secluded and frequently inadequate merit rating or performance appraisal
schemes
In
the 1990s, the term "performance management" became popular in the HR
field. It is now widely accepted that performance management is a natural
management process that contributes to the effective management of individuals
and teams to achieve high levels of organizational performance
According to Mangipudi,
et al, (2020) figure 1.0 illustrates that performance management has evolved
over the period. Competencies have evolved and gained logical significance.
Figure 1.0: Evolution of Performance Management.
Source:
Performance Management Cycle/System
The effectiveness of a
performance management system (PMS) is a measure of the alignment of employee
and organizational goals
Figure 2.0 Performance Management Cycle
Source:
According to Sahu, (2007) figure 2.0
describe a performance management cycle or system is a process that includes performance
planning (goal setting), where everyone is set with SMART objectives, performance
monitoring and coaching, where the current performance based on the goals
setting are reviewed and correction and coaching are done to enhance the
performance. Measuring (evaluating) individual performance in relation
to organizational goals, providing feedback. Rewarding the individual
based on the achievements in relation to setting performance goals and required
competencies and developing a development plan
For example, WNS Global Service (pvt) ltd, a BPO firm, employs a traditional performance management system in which performance is measured through a rating based on employee errors. The organization employs a ranking system in which each employee is ranked based on quality metrics such as processing accuracy, average customer handling time, and the number of calls per day target. This is known as an employee's Key Performance Indicators (KPI).
References
- Armstrong, M., 2010. Armstrong's Handbook of Human-resource Management Practice (11th ed.). Human Resource Management International Digest, 18(4).
- Armstrong, M. & Baron, A., 2005. Managing Performance: Performance in Action. 1st ed. London: CIPD.
- Armstrong, M. & Taylor, S., 2014. Armstrong, M. and Taylor, S., 2014. Armstrong's handbook of human resource management practice, 13th edition. London: Kogan Page.. pp. 335 - 336.
- Awan, S. H., Habib, N., Akhtar, C. S. & Naveed, S., 2020. Effectiveness of Performance Management System for Employee Performance Through Engagement. SAGE Open, 10(4), pp. 1-15.
- Mangipudi , M. R., Prasad, K., Vaidya, R. W. & Muralidhar, B., 2020. Evolution of Performance Management Systems and the impact on Organizations Approach: A Statistical Perspective. International Journal of Management, 11(5), pp. 988-1000.
- Sahu, R. K., 2007. Performance Management System. 1st ed. New Delhi: Excel Books.

