PERFORMANCE MANAGEMENT

- Concept

Dr. Meenakshi Khemka

 What is Performance?

Performing well means being productive

Productivity implies both concern for

effectiveness and efficiency

Effectiveness refers to goal accomplishment

Efficiency evaluates the ratio of inputs

consumed to outputs achieved

 Introduction

Two sets of terms :

· Performance Appraisal

· Performance Management

Performance Management
 Appraisal vs. Management

•Performance Appraisal:

- an end-point activity of evaluation once the

work is over

•Performance Management:

- an on-going process of directing the employee

at work

Performance Management
 Performance Management vs.
Performance Appraisal
 PM covers PA and some other related activities

 PM emphasizes the supervisor’s essential role to

help and support the supervisees in putting in
extraordinary performances to achieve their goals

 PM emphasizes that performance is the joint

responsibility of the supervisee and the supervisor
 Appraisal - Definition

Conceptually, Performance Appraisal can be defined

as a “ formal exercise in which an organization

makes an evaluation, in documented form of it’s

employees, in terms of their contributions made

towards achieving organizational objectives”.

Performance Management
Forerunner Companies Using
Appraisal System

a. Union Carbide : 1940

b. Bata : 1950

c. Tisco : 1953

d. Voltas : 1954

Performance Management
Different Approaches To Evaluating
Employees
1. Rating scale

2. Employee comparison methods

● Ranking Systems

● Forced distribution

3. Checklist

● Weighted checklist

● Forced choice

Performance Management
Different Approaches To Evaluating
Employees

4. Critical incident

5. Field review

6. Free form essay

7. Group appraisal

8. BARS

Performance Management
 Rating Scale

The rating scale method provides a form wherein, for each

person that is to be rated, the number of qualities &
characteristics are enumerated

Work attitudes

0 5 10 15 20

No interest Indifferent to Interested Enthusiastic Vigorous

in work instructions in work

Performance Management
 Levels Of Rating Scales

Two level Scale

Three level Scale

Four level Scale

Five level Scale

Six level Scale

Performance Management
 Performance Management -
Definitions…
1. “Performance Management is the continuous cycle of improving job
performance by integrating the activities of goal setting, feedback and
coaching, providing rewards and positive reinforcement”.

(Kreitner and Kinicki)
2. “Performance management is the process that begins with translating the
overall strategic objectives of the organization into clear objectives for
each individual employee.”

(Amos, Ristow and Ristow)
3. “Performance Management is an approach to creating a shared vision of
the purpose and aims of the organization, helping each individual
employee understand and recognize their part in contributing to them, and
in so doing manage and enhance the performance of both the individual
and the organization”.

(Fletcher)

Performance Management
 Performance Management -
Definitions…

4. “Performance management defines measures and motivates an employee’s

performance on the job and aims to increase the effectiveness of the
company”.

(Hartog, Boselie, and Paauwe)

5. “Performance Management is a system composed of an orderly series of

programmes designed to define, measure, and improve organizational
performance”.

(Katz and Green)

Performance Management
 Performance-managed Organization

 Measurable performance targets

 Managee-learning linked with organizational
goals on the one hand and with career
development on the other
 Pre-eminence of intrinsic needs of managees
without neglecting their extrinsic needs
 Ownership of performance management by line
management rather than the personnel function
 Managers’ Concerns And Interests

 The rationale for establishing a performance management

system does, and must emerge from the managers’
concerns and interests. The problems are:
 Remedying poor performers and performance
 Bridging gaps in performance expectations
 Securing equitable rewards and punishment decisions
from the organizational management
 Softening performance pressures through appropriate
planning, scheduling and delegation
 Key to PM

 Periodic orientation of the team

 Empathize with the team-members
 Team members allowed to think independently
 Performance managers is to see how to keep the
managees’ organizational role high on their
priorities, without disabling them to perform their
other roles
 Performance Management is
People Management

 Organization-level Functions

 Department/Group-level Functions
 Process of PM

Performance
Performance
Monitoring &
Planning Coaching

PM
Process
Cycle

Performance Linked Performance

Reward & Measurement &
Development Plan Feedback
 Performance Management System

PMS also facilitates:

Career planning

Redeployment / transfers

Career counseling

Assessment of potential

Job redesign

Clarity of performance goal & direction
 Performance Management System

The PMS process has two clear objectives:

The evaluation objective

The development objective

 PMS Objectives – Evaluation

Performance evaluation and assessment of

the readiness for higher responsibilities

To provide feedback on performance levels

To generate data required for decisions on

salary, bonus etc.

 PMS Objectives – Development

To counsel and coach subordinates

To motivate subordinates through recognition and

support

To strengthen supervisor subordinate relations

To diagnose individual and organizational

competencies

To define the training requirements

 Key Outputs of the PMS

Individual level expectations and targets

Performance status and corrective actions

Individual performance evaluation

Individual competency evaluation

Individual level development plans

Individual potential evaluation

 How is PMS Linked to Other Processes ?

Compensation
Performance
Assessment

Upgradations/
PMS Promotions

Competency Job Rotation

Assessment & Transfers

Training &
Development
 Goals Oriented PMS Cycle

STAGE – 1
Achieving clarity about
the job to be
done

STAGE – 5
Concluding the STAGE – 2
performance GOALS Setting goals
discussion ORIENTED
PMS

STAGE – 4 STAGE – 3
Preparing for the Reviewing
performance performance in
discussion the job
 THANK

YOU

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26 Performance Management