Performance Management System: Advantages and Disadvantages

Aim and Role of Performance Management: Increasing Value and Promoting Growth

Although the concept of performance management is relatively new to the global business environment, it has already become an integral part of the corporate processes and the quality management frameworks in companies worldwide (Madjid 2014). The foundation of performance management as a phenomenon is fairly basic; by definition, the subject matter is a set of tools aimed at controlling and improving the corporate processes so that the goals and objectives set previously could be met successfully (Monden & Minagawa 2015). In other words, performance management incorporates an array of tools that are supposed to improve the output delivered by the members of the company’s departments.

The aim of performance management in my organization concerns primarily increasing the firm’s performance rates. It could be suggested that the subject matter also allows for a rapid reduction of waste and defects. Indeed, the enhancement of the corporate processes often demands not only addressing external issues but also fighting the problems that can be defined as intrinsic. Seeing that a range of faults in the company’s design may affect the staff’s performance rates at its core level, there is a pressing need to remove these obstacles and, therefore, prevent the firm from spending extra costs or producing an excessive amount of waste. As a result, the value of the company can be increased significantly.

Models of High-Performance Work Systems: Analysis and Practical Application

Making sure that the employees comprehend the tasks that they are assigned and are capable of completing them by meeting the highest company standards is crucial to facilitating quality performance in the workplace. Particularly, it is crucial to make sure that elements such as training, performance appraisal, and compensation are included. To assess the quality of the employees’ delivery and the overall progress of the firm, my company uses the latest High-Performance Work Systems (HPWS) models.

For instance, a detailed analysis of my organization’s performance delivered over the past few years shows that there is a direct correlation between the outcome measures such as the innovativeness of the solutions, the profitability of the entrepreneurship, the productivity of the labor, the employee turnover, etc., and the HPWS deployed at the company. Based on the outcomes of the study, the model implying a rational use of the workforce as the foundation for the enhanced performance was designed. The concept of the strategic human resource management (SHRM) was defined by CIPD as the tool that allows coordinating the needs of the staff members and the strategic goals of the entrepreneurship, thus, helping leave all parties involved satisfied: “Strategic human resource management (strategic HRM, or SHRM) is an approach to managing human resources that supports long-term business goals and outcomes with a strategic framework” (Chartered Institute of Personnel and Development 2015d, par. 1).

Another approach used in my organization as the means of enhancing the staff’s performance is a combination of SHRM and partnership. For instance, the company enhances the staff’s performance through innovations and the active promotion of the latest technological advances. Although substantial training is required to make sure that the employees are capable of using the latest technology, the adoption of new instruments and the provision of the required training helps manage the output more efficiently. Similarly, the organization fount it easier to promote SHRM when cooperating with the companies that share the same philosophy of building relationships with employees.

It should be borne in mind, though, that active use of innovation a the tool for enhancing SHRM demands that the company’s R&D department should receive a significant amount of financial support. My company coordinates the issue by carrying out the policy of sustainability, i.e., the distribution of the corporate resources based on the need for them in the corresponding departments. As a result, waste levels are also controlled tightly (Liu, Sung, & Yao 2013). The Lean Manufacturing strategy has the same effect on the arrangement of resources, which is why it is also accepted in my organization as the leading principle of resources management (Longoni 2014).

Effective Performance Management Policies and Practices: How Performance at My Company Can Be Improved

Using Performance Management Systems Appropriately: Capability. Performance Appraisal, and Other Tools

The company that I work for uses the available performance management systems very wisely, putting a very strong emphasis on the appraisal of the staff and the recognition of their efforts. Rewards and incentives are suggested as the means of encouraging the people that deliver the best performance.

Still, despite the active use of the appropriate tools, the organization for which I work could use a significant improvement in its performance management systems. For instance, using reports and other tools that serve as the means of detecting absence can be viewed as a rather efficient means of mitigating the phenomenon; however, unfortunately, it does not resolve the actual problem. Indeed, the core factors shaping the absence rates among the staff members are not identified and removed from the organization’s design. Instead, the employees are forced to work excessively hard, which may lead to a sharp increase in workplace burnout rates. Indeed, studies show that, unless designed properly, the tight schedule of the staff members is likely to make the employees work to the point where they are too exhausted to deliver quality performance. Furthermore, tight schedules are likely to lead to making the employees suffer from workplace burnout; as a result, they will be unable to perform at the required level (Waal 2013).

Therefore, it is strongly suggested that return-to-work interviews should be viewed as the primary tool for collecting the data necessary to shape the current schedule. As soon as the staff members explain honestly what makes them fail to meet the required standards and not attend work regularly, further steps can be made to manage the issue and prevent similar situations from occurring in the future (Chartered Institute of Personnel and Development 2015a).

Review Process in the Organization: The Concepts of Fairness and Ethics as the Leading Principles

Promoting diversity and fairness as the core principles of the company’s operations is crucial to improving the staff’s performance (Chartered Institute of Personnel and Development 2010b). Unless the tools for achieving ethical practice are incorporated into the firm’s design, the premises for successful management of the human resources will become hardly attainable. To enhance fairness and ethics in the context of the HR practice, my organization uses the principles of transparency.

It should be noted that the reinforcement of the transparency and fairness principles starts at the stage of recruiting the employees. The organization for which I work makes it completely evident that fairness and openness are its guiding principles by incorporating them into its values and declaring it in its mission statement. As a result, the people that apply for the positions suggested by the company are fully aware of the fairness requirements set by the firm.

Performance Management Learning Programs

The organization also deploys a variety of performance management learning programs that allow for a rapid improvement of the staff’s qualifications. Among the crucial ones, the programs that are geared toward talent management need to be mentioned. Incorporating an integrated talent management approach, the programs imply that the staff’s talents should be explored, developed, and applied to various aspects of the firm’s operations.

Most of the programs suggested by the company as the means of reinforcing the staff’s performance are linked to the personal and professional development of the staff. The emphasis on the personal growth aspect helps create more trustful relationships between the employees and the company. By showing the readiness of the entrepreneurship to cater to its personnel’s needs, the firm builds premises for an increase in loyalty rates among the target audiences. As a result, a massive investment in the human resources of the organization becomes fully justified.

Evidence and Efficacy of the Programs: Why the Tools Deserve to Be Used

It could be argued, though, that the use of the 360-degree feedback could use a significant improvement in my organization. Despite offering extensive opportunities for growth to its members, the company fails to collect feedback about the impressions and experiences that the staff members have had so far, as well as the effects that the programs have on the target population. Consequently, several important facts and suggestions remain unnoticed by the company’s HRM department. The use of electronic and print surveys, interviews, and other means of collecting data from employees and customers can be viewed as the essential means of retrieving the necessary data (Chartered Institute of Personnel and Development 2015c). Typically known as the 360-degree feedback, the approach is bound to shed some light on the effects of the programs, as well as instruct the HR staff on the further steps to be taken to improve the quality of the employees’ performance (Chartered Institute of Personnel and Development 2015b).

Role and Skills of Line Managers as an Integral Part of the Company

The role of Line Managers (LM) in performance management and the related processes is crucial. According to CIPD, LM is supposed to manage employees or teams directly (Chartered Institute of Personnel and Development 2016b). Using LM’s assistance in evaluating the performance of the staff members will be crucial as LM will provide an objective overview of the changes that the personnel of the company has made. For instance, the front-line managers will carry out a day-to-day assessment of the staff members; thus, a detailed analysis of the progress made on a specific time slot will become a possibility.

It should be borne in mind, though, that certain tension may emerge in relationships between LM and the HR team. The reasons for the enmity between the two departments are quite understandable – because of the recent shift in the strategies of appointing the target departments with roles and responsibilities, the line between the role of an HR and an LM has been blurred significantly. As a result, the threat of an LM taking charge of the HR-relate processes has become more tangible: “The relationship between the HR function and line managers has been subject to several changes and tensions in recent years. Adjustments in the delivery of HR have shifted responsibility for many-core activities, such as recruitment or objective setting, away from HR” (Chartered Institute of Personnel and Development 2016b). Nevertheless, the promotion of transparency and the principles of information sharing, coupled with the concept of working toward the same goal will help address the conflict and nip it in the bud.

As a result, the prerequisites for a more reasonable cost management approach can be created. Indeed, because of the irrational use of the company’s human resources, the firm may face a steep rise in operational costs. A more careful distribution of roles and responsibilities, in turn, will help mitigate a range of factors that contribute to an increase in corporate expenditures.

Using Appropriate Performance Management Techniques: What Boosts Staff’s Motivation

Addressing the Capability Issue: Personal Development Plans and Other Tools

According to the philosophy built by CIPD, the phenomenon of capability is linked directly to the concept of leadership. The latter can be used as the means of determining the phenomenon of capability: “leadership has been described as a process, or as a capability of the organization (rather than individual), emphasizing the interplay of leaders, followers, and the organizational context that impact leadership effectiveness” (Chartered Institute of Personnel and Development 2016a).It could be argued that the statement by CIPD mentioned above denies the absence of intrinsic leadership qualities and, instead, conveys the idea that being a leader is something that everyone can learn. Indeed, the definition provided by the organizational assets is emphasized heavily as opposed to the individual ones. Therefore, it can be deduced that leadership qualities can be acquired successfully once the appropriate training tools are designed and the opportunities of each staff member are assessed.

Thus, there is an urgent need in creating personal development plans for the members of the organization for which I work. As stressed above, though knowing the basic requirements and striving to meet them, the people working at the same company that I do lack motivation and are incapable of making the decisions that are related to the organization. As a result, the performance of the company suffers slightly. Although the challenges faced by the company in this regard cannot be deemed as drastic, they affect the success of the entrepreneurship and, thus, need to be handled appropriately. Thus, every member of the personnel must be provided with a personal development plan that will point them to the opportunities that they need to pursue to remain highly qualified professionals and be appreciated by the organization.

The personal development plan will help increase the capability of every member of the personnel significantly as it will point to the specific area that the members of the organization will have to work on to improve their competencies. However, apart from the identified approach, one should also consider other methods that will help improve the capabilities of the employees. For instance, the significance of talent development must be stressed in the context of the organization for which I work. Apart from the obvious advantage of providing the staff members with a chance at acquiring new skills and knowledge, the identified device can be viewed as the means of mapping the staff members’ professional progress, enabling them to be more independent in their evolution as experts in the areas of their competency.

According to CIPD, there are eight essential domains that one must consider to acquire the appropriate leadership skills (i.e., being a decisive thinker and a skilled influencer, gain personal credibility, develop the ability to collaborate, be driven to deliver the best performance possible, striving to become the role model for the rest of the personnel to make an example of and be curious about the company, its key processes, the factors that affect its success, and the overall environment that the organization works in (Chartered Institute of Personnel and Development 2010a)).

Setting Objectives and Targets in the Organization: Overview and Assessment

As stressed above, the lack of motivation among the staff members, including the reluctance to acquire new skills and knowledge, can be viewed as the key obstacle to the company’s way to success. Therefore, there is a pressing need to consider the tools that will help increase engagement rates among the staff members, at the same time promoting the corporate ethics as the foundation for the decision-making processes in the context of the firm. Furthermore, the concept of continuous learning and active acquisition of new skills and abilities can be considered a crucial step on the way to improving the results delivered by the company’s personnel.

Considering the information provided above, one must admit that the current objectives of the company that I work for could use significant improvement. At present, the company is geared heavily toward the improvement of the performance rates, which can be viewed as related closely to the concerns voiced above However, the organization leaders seem to be focused on the technical aspect of the results delivery rather than on the personal issues that the staff members may be having, e.g., the lack of learning perspectives. While the idea of introducing various tools that help address the consistency of the manufacturing process (e.g., the approaches allowing for a rise in the repeatability and reproducibility rates) can be deemed as quite legitimate, the organization should also pay closer attention to the personal needs of the employees.

Reward System Evaluation: Financial Incentives and Public Appraisals as the Tools of Motivating Staff

Unless the employees are encouraged to excel in their performance, they are unlikely to be working toward consistent quality improvement. Therefore, it is imperative to make sure that the personnel is motivated to deliver the best services possible. Traditionally, a combination of financial rewards and public appraisals is used to encourage the company members to acquire new skills, engage in the lifelong learning process, and perform to the best if their abilities.

Based on the concept of a proper reward system provided above, it may be assumed that my organization offers enough incentives to its staff members. Indeed, at the place of my work, public recognition of the achievements made by the team members are just as common as the financial incentives. By using a clever combination of both, the HR managers become capable of encouraging the employees to work even better and contribute to the organization to a greater degree.

However, based on the concept of the reward system as it is viewed by CIPD, the one that is deployed at my workplace could use some improvements. Particularly, the introduction of the total reward system into corporate design could be viewed as a possibility. By definition, the phenomenon of the total reward system can be defined as the concept that “encompasses all aspects of work that are valued by employees, including elements such as learning and development opportunities and/or an attractive working environment, in addition to the wider pay and benefits package” (Chartered Institute of Personnel and Development 2016c). In other words, based on the principles of the total reward concept, it is necessary to provide financial incentives and emotional support for the employees in every domain of their professional progress, including the acquisition of new skills and knowledge (e.g., participation in training programs).

The use of the total reward system is bound to have a positive effect on the level of expertise and the performance rates of the company members. To make sure that the proposed system should work in the design of the corporate environment, one should make sure that the system of total reward suggested as the means of boosting the employees’ performance is based completely on the firm’s values and vision. As long as at least one element of the total reward system is out of place, it is unlikely that the employees should interpret it as the suggestion to work toward both their interests and the ones of the company.

In other words, arranging the vertical system that implies drawing a correlation between the objectives of the organization and the employees’ personal goals should be viewed as the priority of the firm at present. Much to the credit of its leaders, the organization currently balances between meeting the employees’ personal needs and attaining the essential corporate goals quite successfully. However, to make the reward system even more efficient, one will have to elaborate on the concept of investing in human resources as one of the essential assets of the firm. Therefore, the emphasis will have to be placed on the personal and professional progress of the staff. Consequently, there will be a need to encourage the personnel in their attempts at gaining new knowledge and skills.

Performance Management Processes: Benefits and Limitations

The current strategy toward performance management adopted by my organization can be considered passable. Although it has several problems in it, it still helps promote a rapid improvement in the employees’ performance rates, as well as sustain them at the same high level within a significant amount of time. Seeing that the organization is geared toward the achievement of long-term goals and compliance with the existing principles and values, it can be defined as strategic based on the framework suggested by CIPD (Chartered Institute of Personnel and Development 2015c).

Although the identified approach can be viewed as sensible from the perspective of the organizational needs and goals, it may prevent from putting a stronger emphasis on the needs of the employees; as a result, conflicts may emerge in the workplace, leading to a gradual drop in the quality of the staff’s performance. Much to the credit of leaders of global organizations, the contemporary systems of the strategic performance management has evolved significantly over the past few years, creating a leeway to the design of a more efficient approach of supervising the employees’ work and promoting better standards. For instance, Mitrović, Todorović, and Bjelica (2013) assert that the creation of the integrated managerial accounting framework as well as the overall promotion of the value-based management principles has shaped the current approach to performance management significantly, allowing to coordinate the company’s needs with the ones of the staff members.

Unfortunately, the approach designed by the company for which I work also has its limitations. As CIPD members emphasize, although having proved to be quite successful, the concept of strategic performance management tends to be interpreted as inferior to its current counterpart, the integrated performance management(PM). The latter, in its turn, implies that the essential corporate processes should be linked when viewed through the lens of the PM framework: “it should link various aspects of the business, people management, individuals and teams” (Chartered Institute of Personnel and Development 2015c, para. 2). As a result, the opportunities for better coordination of the crucial actions can be created. The strategic approach that is currently employed at my organization, in its turn, does not provide the identified opportunities (Shields, Brown, & Kaine 2015).

Managing Achievement and Underachievement: Communication Strategies That Help Convey Essential Messages

Promoting Employee Involvement and Communicating Performance Goals Commitment

As stressed above, to enhance the involvement rates among the staff members, my company should consider the use of incentives, including both public appraisals and financial rewards, with a strong emphasis on the former. It should be borne in mind, though, that the public recognition of the employees’ achievements must be carried out with due subtlety so that the company’s congratulations on the employees’ success and the gratitude for the accomplishments of the staff could sound sincere, thus, encouraging the target audience to excel in their performance (Bugdol & Jedynak 2014).

The involvement rates can also be enhanced by putting a heavier emphasis on the significance of the corporate values and ethics. Stressing the need to meet the ever-changing standards and explaining that the acquisition of the relevant skills is an integral part of proper professional growth, entrepreneurship will be able to encourage the staff to participate in courses aimed at increasing their competencies. Consequently, the employees will be more eager in enrolling the identified type of programs, thus, building the pathway to further lifelong learning and regular update of their skills and knowledge.

The Mechanics of Feedback Provision: How a Team Can Report About Its Achievements

When creating a viable performance management strategy, one should also consider the opportunities for managing the information appropriately retrieved in the process. Particularly, every piece of relevant data must be acquired, processed, and used as the means of the further decision-making process accordingly. Therefore, the procedure of feedback retrieval needs to be established in the target environment. As stressed above, there is a consistent need in retrieving the 360-degree feedback so that the appropriate strategies for managing the key operations and assigning the staff members with appropriate roles and responsibilities could become an opportunity.

Using IT to Enhance Performance: Information Management as the Pathway to Success

Apart from redesigning the current approach to resource allocation and the communication patterns between the company managers and the staff members, one should also consider restructuring the IT framework used in the organization. Specifically, the very role of information in the context of the organization needs to be revisited. Information should be viewed as a tool for achieving the company’s goals and improving the quality of performance. Therefore, the principles of data sharing as the foil for the development of a more responsible information management framework will have to be considered (Petraq 2015).

IT tools, in their turn, will play a crucial role in the enhancement of information management in the firm. The use of the latest IT devices and gadgets will help retrieve, process, and transfer the necessary data within the shortest amount of time possible (Dimon 2013). Furthermore, the information belonging to the company will remain secure as long as the staff members follow the set guidelines about digital data safety. Speaking of which, the introduction of the IT devices as the means of processing the relevant facts and statistics will require that the employees should undergo training to develop the necessary skills. The issues regarding data safety need to be brought to the employees’ attention first. In the wake of the digital era, cybercrimes and the breach of cybersecurity pose a serious threat to the well-being of companies operating in the global market (Trim & Lee 2014). Therefore, there is a necessity to make sure that the staff members are aware of the basic precaution measures (Shoemaker & Sigler 2014).

Performance Management Effectiveness: A Critical Look at the Current Strategies

Performance Management System Assessment: Advantages and Disadvantages

As explained above, the current assessment system can be deemed as rather efficient as it helps identify the changes in the staff’s performance, as well as pinpoint the exact time at which the issue emerged. As a result, a detailed analysis of the factors that may have led to the development of the problem can be isolated for further analysis of the available solutions and the design of the strategy that will be used to handle the issue (Demartini 2013).

However, the current performance management evaluation tools also lack a focus on the design of the courses that will serve as the foil for improving the employees’ competencies. Although the use of financial incentives and performance appraisals is a perfect tool for encouraging the employees to excel in their performance, thus, delivering better results, the current framework could use more options for professional progress. For instance, the courses that will teach the participants the foundations of leadership and the negotiation techniques can be viewed as the possible choice for the direction in which my organization may evolve. Indeed, the use of negotiation techniques in the process of decision-making will help persuade the employees to apply the values that constitute the corporate philosophy. As a result, a significant drop in the number of defective items produced by the organization, as well as a rise in the quality of the staff’s performance, in general, is expected (Barsalou 2015).

Models That Could Change the System for Better: Examples and Suggestions

As stressed above, implementing change in the context of a contemporary organization is a challenging task because of the large array of factors that affect it in the global market. Nevertheless, several models promoting successful change have been designed recently and can be used to propel the organization to the top of the market. For instance, the DMAIC (Define, Measure, Analyze, Improve, Control) tool suggested by Thomas Pyzdek (Pyzdek & Keller 2014) can be deployed along with the Total Quality Management (TQM) framework (Oakland 2014). Thus, the amount of waste produced regularly can be reduced, and the essential principles of sustainability can be promoted in the target environment.

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