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Dolphin Logistics Company: Performance Management And Competitive Advantage

Importance And Strategic Purposes Of A Performance Management System

Discuss about the Dolphin Logistics Company for goals and objectives.

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Dolphin Logistics Company is preparing to enter the Singapore and Hong Kong logistics market by 2018. The company is keen to chalk out some efficient performance management plans to ensure that the management teams and the employees would contribute their best towards the fulfilment of the company’s goals and objectives. Performance management is an approach which helps an organisation in measuring the performances of the individuals, groups and the organisation on the whole so that they can meet their goals and objectives (U.S. Office of Personnel Management, 2016). Performance management has been adopted by many organisations as a continuous system where they follow a three step approach i.e. plan, monitor and review the performance of the organisation by taking a closer look into the work objectives and the overall contribution to the organisation (Hrcouncil.ca, 2016).

The stages that would be involved in the implementation of performance management system are given below:

In the present day world of global competition, the only resource upon which a company can rely to gain competencies is the human resource. Human resource has been rightly termed as the lifeblood of every organisation and to survive the global competition in the modern day world, organisations must have the right people at the right place to achieve the desired goals and objectives. To improve the overall performance of the companies, in such a scenario, it is important that there should a system of performance management which helps in determining the gaps between the actual performance and the desired performance so that the organisation can take up necessary steps to bridge the gap between them. Let us now discuss some of the advantages and strategic purposes of a performance management plan:

  • Clarity of goals and objectives à in order to increase the performance of the employees and the organisation on the whole, it is important that the employees have clarity of goals and objectives in their mind. They should be aware of the expectations that the company has from them and how their efforts would contribute towards the success of the company. Performance management helps in the determination of goals and objectives, which are realistic, achievable and measurable. Once the employees are aware of the goals or the objectives that they have to meet, they can work harder towards their fulfilment (Puckett, 2015).
  • Management and coaching à another important benefit of performance management is that it helps in identifying the gaps that exist in the skillsets of the employees. Sometimes, the employees might now have the required skills to achieve a certain goal or an objective, which can be identified using performance management. Once the lacking skillsets are identified, the management can provide coaching or training to the employees so that they can attain those skills and can perform better towards the fulfilment of the organisation’s goals and objectives (Puckett, 2015).
  • Rewards and recognition à recognition and rewards are the best ways to keep the employees motivated to perform well. Performance management acts as an approach where the employees can be judged on the basis of their performances and can be accordingly rewarded. It helps in reinforcing the right behaviour and leverages social engagement.
  • Development planning à the human resource of a company has a continuous requirement of being judged on the basis of their performances. It helps in the identification of the skills that the employees lack and further helps in deciding the ways in which the skills can be attained. It acts as an approach that helps the employees in developing their career paths and making continuous progress by assessing their performances. It has been found that the organisations that undertake training and development programs on the basis of performance management systems have a 38% higher employee engagement rate and 61% of more positions with a ready and willing successor identified (Morebusiness.com, 2016).
  • Employee motivation and retention à one of the most critical issues that face the modern day business organisations is the increasing turnover rates of the employees and difficulty in keeping them motivated for higher performance and productivity. Performance management can benefit a company as it helps in retaining the employees and motivating them because of the possibilities of promotions, increments, rewards and incentives.

Performance management has been considered to be one of the most essential and important element of the whole concept of human resource management. It has been found that most of the successful and winning organisations have shaped their success by implementing efficient performance management systems that help in increasing the employees’ job commitment, motivation, productivity and efficiency. Performance management provides an approach that fosters a culture where incentives, opportunities and rewards are provided to those who show exceptional and continuous performance throughout the period for which the performance is being assessed (performance management and competitive advantage, 2014).

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Watson Wyatt Worldwide, a  giant human resource consulting firm, conducted a survey where only three respondents said that there company’s performance management system was efficient enough to measure what it was intended to measure. Further surveys have shown that only 40% of the employees feel that the company they work for had been able to clearly convey their performance expectations and generated honest feedback and without any doubt, the companies with efficient and effective performance management systems have been able to perform better than the competitive firms in the longer run. They have been able to retain and recruit better talent in the organisations and have experienced better financial results over the period of time (Anon, 2016).

Performance Management and Competitive Advantage

Performance management has been widely implemented by almost each and every company but not all companies have been able to design performance management programs that could actually bring them some kind of benefits. There are a million of examples where some of the top companies in the world have lost their competitive advantages due to the implementation of inefficient performance management systems while there are millions of companies that have sailed to the top positions due to their effective performance management systems. Performance management system can bring in competitive advantages for the company in the following ways:

  • Better talent acquisition and retention à companies that have efficient and effective performance management systems are able to foster a great positive image in the market. Freshers as well as experienced or talented employees tend to work with such companies that have better performance management systems rather than working with companies that have unrealistic or poor performance management systems. Thus, the companies with better performance management systems are able to acquire and retain better talent.
  • Increased job commitment, performance and motivation amongst the employees à when the employees realize that the scope of their promotions, incentives, rewards, etc. are dependent upon the performance that they show during the measurement period, they tend to perform better. The system of performance management provides them with an opportunity to develop their career and they become more committed towards the job and the company on the whole. Therefore, the overall performance and the productivity increases, which obviously is an added advantage to any company.
  • Fosters a competitive environment à a system of performance management can actually foster a feeling of competition amongst the employees who try to outperform their peers to gain appreciation, recognition, opportunities, promotions, incentives, etc. Such an environment prevents the workplace from becoming boring and monotonous and a competitive environment would obviously increase the productivity and performance of the employees, which would ultimately benefit the company to a great extent.
  • Better work environment and human resource management à performance management is one of the best approaches that can help in improving the work conditions and the conditions of the human resources. By measuring the performance of the employees, the management can identify the skills that the employees lack, which hinders their performance. Consequently, the management can take up necessary steps to ensure that the employees acquire the lacking skills and can contribute more towards the success of the organisation.

In this part of the assignment, we will prepare an action plan for the implementation of a performance management system in the Singapore and Hong Kong subsidiary of the Dolphin Logistics Company. First of all, let us discuss some important characteristics of a good performance management system:

  • Measureable goals and objectives à it is very important that the goals and objectives that are being developed are measureable using some metrics. If the goals and objectives are easily measurable, the process of performance management becomes much easier (Synergita Blogosphere, 2013).
  • Key Performance Indicators à the management should decide a number of key performance indicators that it would use to judge the performance of the employees. Appropriate key performance indicators would ensure that the performance management system measures the right things or the things that it is intended to measure (Smallbusiness.chron.com, 2016).
  • Should be unbiased and transparent à one of the most important characteristics of a good performance management system is that it should be totally unbiased and transparent. It should award only the deserving while the performances of the employees should be rated clearly and based on proper performance indicators. It has been found that biased performance management systems can have a great number of negative impacts on the reputation and the workforce of the company (Rollins, 2015).
  • Rewards and incentives à A performance management system is incomplete until and unless it has certain rewards or incentives to offer to the star performers of the year. Rewards and incentives are the things that the employees care about and that motivate them to perform better. Therefore, the rewards should be realistic and should be based upon the needs of the employees.

Designing a performance management system is not easy and cannot be designed by a single department in the organisation. It takes a lot of time, resource and efforts from various people in the organisation to design a good performance management system. Let us discuss the people who should be included in designing of the action plan:

  • Departmental heads à it is important to include the departmental heads from the entire organisation as it is important to include all the employees in the performance management system. The departmental heads would be able to share knowledge about their respective departments, performance metrics, employee expectations, etc.
  • Human resource managers à human resource managers have the maximum knowledge about the human resource planning and expectations of the company. Therefore, it is important to include them in the planning phase too.
  • Front line managers à front line managers are the people who the employees follow and as the implementation of a new performance management system would involve certain changes to be introduced, it is important that the front line managers are involved in the planning phase as they would act as change facilitators at a later stage.

Implementation of a performance management system involves a great effort from each and every department and hierarchical level of the organisation. It requires careful design, execution and introduction of the plan so that the plan is well communicated and the resistance to change can be minimised. The implementation should be carefully done as it involves investment of a lot of resources and efforts from the management, which must not go in vain. The various stages and the steps involved in the implementation of the performance management system are:

  • Design stage à this is the first stage in the implementation process where the performance management system is defined by the people involved in the designing phase. The design stage would consist of approximately 2 months where the management will take important decisions about the performance management system. The design process should be completed before the start of the new financial year as it would become easier for the company to measure performances annually or semi-annually. The various steps involved in the designing stage of performance management system are:
  • Ensuring support from senior management
  • Creation of implementation teams
  • Preparing the organisational gaols and objectives
  • Preparing a draft performance model
  • Identifying the critical success factor
  • Identifying the key performance indicators
  • Development of scoreboards (Imanet.org, 2016)
  • Execution stage à in this stage, the management executes the plans or the designs that it has prepared in the first stage. The implementation of the performance management system requires a lot changes to be introduced in the organisation. The front line managers would be appointed as the change facilitators and they would be given the responsibility of bringing about the change using the Kurt Lewin’s Three Phase Change Model. The execution stage will take almost a month so that the new performance management system is clearly communicated to the employees. The employees should be well aware about the criterion being used for performance management so that they know what they have to do.
  • Monitoring à once the system of performance management has been implemented in the organisation, the management would start to monitor the performance of the employees on a weekly, monthly, half-yearly or annual basis and keep a constant record of it. It would note down the performance of the employees according to the key performance indicators identified in the planning stage. From this stage onwards, all the steps in implementation are to be continuously carried out throughout the year to achieve the best results.
  • Analyse à the management would analyse the performance data collected in the third stage. One of the best ways to analyse the performances of the employees is through a 360 degree feedback. 360 degree feedback is a system where the employees receive confidential and anonymous feedback from the people who work around them, such as seniors, peers and direct reports. 360 degree feedback can provide a detailed and unbiased feedback on the performances of the employees and can help the management in accurately appraising the employees according to their performances (Custominsight.com, 2016).
  • Adapting to survive à the management would semi-annually or annually hold meetings or functions where it would discuss the performance shown by the employees and would announce the rewards, promotions or opportunities being given to them because of their performances. It is important to include rewards and opportunities for the star performers of the year as it would help in reinforcing the right behaviour within the organisation. The management would also discuss the gaps or the skills that the employees lack, which have been identified with the help of the performance management plan and how it plans to train or develop the employees so that they can acquire the lacking skills.

One of the most important components of a performance management system is the rewards that are given to the employees on the basis of their performance. The rewards in a performance management system should be correctly linked with the performances of the employees. Let us discuss some rewards for different category of employees:

  • For corporate leaders à employee stock ownership or profit sharing are the best possible rewards
  • Business Unit Leaders à for this category of employees, results sharing is the best possible reward
  • Functional leaders à this category of employees can be rewarded with milestone rewards based on their performances
  • General employees à for general employees, profit sharing, bonus or promotions are the best type of rewards (Managementstudyguide.com, 2016).

Conclusion

Performance management is one of the best concepts provided by the human resource management subjects even though some managers tend to take it lightly. Most of the managements find it difficult to continuously assess the performance of the employees while the others are not able to implement performance management systems that are efficient enough to foster a positive work environment. It is a proven fact that performance management can increase the results for a company that is able to implement properly. Therefore, it is important for all the companies to implement efficient and effective performance management systems that can foster a positive work environment in the workplace.

References

Synergita Blogosphere. (2013). 5 characteristics of an effective performance appraisal system?. [online] Available at: https://blog.synergita.com/2013/10/what-are-the-characteristics-of-effective-performance-appraisal-system/ [Accessed 5 Jul. 2016].

Smart Church Management. (2015). Advantages and Disadvantages of Performance Management. [online] Available at: https://smartchurchmanagement.com/advantages-and-disadvantages-of-performance-management/ [Accessed 5 Jul. 2016].

Imanet.org. (2016). [online] Available at: https://www.imanet.org/docs/default-source/thought_leadership/management_control_systems/tools_and_techniques_for_implementing_integrated_performance_management_systems.pdf?sfvrsn=2 [Accessed 5 Jul. 2016].

Managementstudyguide.com. (2016). Benefits of a Performance Management System. [online] Available at: https://www.managementstudyguide.com/benefits-of-performance-management-system.htm [Accessed 5 Jul. 2016].

CEO, M., House, J., Workshop, D. and GCAM, I. (2013). Effective performance management systems are a competitive advantage – Jacksonville Advantage Business Magazine. [online] Jacksonville Advantage Business Magazine. Available at: https://advantagebizmag.com/blog/2013/07/02/effective-performance-management-systems-are-a-competitive-advantage/ [Accessed 5 Jul. 2016].

Smallbusiness.chron.com. (2016). Characteristics of an Ideal Performance Management System. [online] Available at: https://smallbusiness.chron.com/characteristics-ideal-performance-management-system-53409.html [Accessed 5 Jul. 2016].

Anon, (2016). Effective Performance Management Systems Are A Competitive Advantage. [online] Available at: https://www.mckenziehr.com/enews/January2005.htm [Accessed 5 Jul. 2016].

Evans, M. (2016). Design of Performance Measurement Systems. [online] Exinfm.com. Available at: https://www.exinfm.com/board/design_performance_measurement_system.htm [Accessed 5 Jul. 2016].

Madjoski, D. (2014). How to Implement a Performance Management System (A to Z process). [online] Available at: https://www.linkedin.com/pulse/how-implement-performance-management-system-z-process-dejan-madjoski [Accessed 5 Jul. 2016].

Managementstudyguide.com. (2016). Need for an Effective Performance Management System. [online] Available at: https://www.managementstudyguide.com/need-for-performance-management-system.htm [Accessed 4 Jul. 2016].

U.S. Office of Personnel Management. (2016). Overview & History. [online] Available at: https://www.opm.gov/policy-data-oversight/performance-management/overview-history/ [Accessed 4 Jul. 2016].

Managementparadise.com. (2016). PERFORMANCE APPRAISAL AND COMPETITIVE ADVANTAGE – Management Paradise. [online] Available at: https://www.managementparadise.com/forums/human-resources-management/226757-performance-appraisal-competitive-advantage.html [Accessed 5 Jul. 2016].

Managementstudyguide.com. (n.d.). Performance Management – Meaning, System and Process. [online] Available at: https://www.managementstudyguide.com/performance-management.htm [Accessed 5 Jul. 2016].

Hrcouncil.ca. (2016). Performance Management | Keeping the Right People | HR Toolkit | hrcouncil.ca. [online] Available at: https://hrcouncil.ca/hr-toolkit/keeping-people-performance-management.cfm [Accessed 4 Jul. 2016].

Performance Management And Competitive Advantage. (2014). 1st ed. [ebook] pp.2-4. Available at: https://www.iimahd.ernet.in/assets/upload/mdp/1832556138PM&CA%20Brochure_2014.pdf [Accessed 5 Jul. 2016].

Tbs-sct.gc.ca. (2015). Performance management program for employees. [online] Available at: https://www.tbs-sct.gc.ca/psm-fpfm/learning-apprentissage/ptm-grt/pmc-dgr/index-eng.asp [Accessed 5 Jul. 2016].

Managementstudyguide.com. (2016). Performance Management and Reward Practices. [online] Available at: https://www.managementstudyguide.com/performance-management-and-reward-practices.htm [Accessed 6 Jul. 2016].

Puckett, J. (2015). Benefits and Importance of Performance Management. [online] TechnologyAdvice. Available at: https://technologyadvice.com/blog/human-resources/importance-of-performance-management/ [Accessed 4 Jul. 2016].

Rollins, J. (2015). 4 Characteristics of an Effective Performance Management System. [online] Available at: https://www.linkedin.com/pulse/4-characteristics-effective-performance-management-system-rollins [Accessed 5 Jul. 2016].

Home.iatspayments.com. (2016). The five stages of performance management | iATS Payments. [online] Available at: https://home.iatspayments.com/industry-news/online-donations/five-stages-performance-management [Accessed 4 Jul. 2016].

Morebusiness.com. (2016). The Importance of Performance Management in Business | MoreBusiness.com. [online] Available at: https://www.morebusiness.com/running_your_business/management/Performance-Management.brc [Accessed 4 Jul. 2016].

Custominsight.com. (2016). What is 360 Degree Feedback ?. [online] Available at: https://www.custominsight.com/360-degree-feedback/what-is-360-degree-feedback.asp [Accessed 6 Jul. 2016].

Dolphin Logistics Company: Performance Management And Competitive Advantage

Importance And Strategic Purposes Of A Performance Management System

Discuss about the Dolphin Logistics Company for goals and objectives.

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Dolphin Logistics Company is preparing to enter the Singapore and Hong Kong logistics market by 2018. The company is keen to chalk out some efficient performance management plans to ensure that the management teams and the employees would contribute their best towards the fulfilment of the company’s goals and objectives. Performance management is an approach which helps an organisation in measuring the performances of the individuals, groups and the organisation on the whole so that they can meet their goals and objectives (U.S. Office of Personnel Management, 2016). Performance management has been adopted by many organisations as a continuous system where they follow a three step approach i.e. plan, monitor and review the performance of the organisation by taking a closer look into the work objectives and the overall contribution to the organisation (Hrcouncil.ca, 2016).

The stages that would be involved in the implementation of performance management system are given below:

In the present day world of global competition, the only resource upon which a company can rely to gain competencies is the human resource. Human resource has been rightly termed as the lifeblood of every organisation and to survive the global competition in the modern day world, organisations must have the right people at the right place to achieve the desired goals and objectives. To improve the overall performance of the companies, in such a scenario, it is important that there should a system of performance management which helps in determining the gaps between the actual performance and the desired performance so that the organisation can take up necessary steps to bridge the gap between them. Let us now discuss some of the advantages and strategic purposes of a performance management plan:

  • Clarity of goals and objectives à in order to increase the performance of the employees and the organisation on the whole, it is important that the employees have clarity of goals and objectives in their mind. They should be aware of the expectations that the company has from them and how their efforts would contribute towards the success of the company. Performance management helps in the determination of goals and objectives, which are realistic, achievable and measurable. Once the employees are aware of the goals or the objectives that they have to meet, they can work harder towards their fulfilment (Puckett, 2015).
  • Management and coaching à another important benefit of performance management is that it helps in identifying the gaps that exist in the skillsets of the employees. Sometimes, the employees might now have the required skills to achieve a certain goal or an objective, which can be identified using performance management. Once the lacking skillsets are identified, the management can provide coaching or training to the employees so that they can attain those skills and can perform better towards the fulfilment of the organisation’s goals and objectives (Puckett, 2015).
  • Rewards and recognition à recognition and rewards are the best ways to keep the employees motivated to perform well. Performance management acts as an approach where the employees can be judged on the basis of their performances and can be accordingly rewarded. It helps in reinforcing the right behaviour and leverages social engagement.
  • Development planning à the human resource of a company has a continuous requirement of being judged on the basis of their performances. It helps in the identification of the skills that the employees lack and further helps in deciding the ways in which the skills can be attained. It acts as an approach that helps the employees in developing their career paths and making continuous progress by assessing their performances. It has been found that the organisations that undertake training and development programs on the basis of performance management systems have a 38% higher employee engagement rate and 61% of more positions with a ready and willing successor identified (Morebusiness.com, 2016).
  • Employee motivation and retention à one of the most critical issues that face the modern day business organisations is the increasing turnover rates of the employees and difficulty in keeping them motivated for higher performance and productivity. Performance management can benefit a company as it helps in retaining the employees and motivating them because of the possibilities of promotions, increments, rewards and incentives.

Performance management has been considered to be one of the most essential and important element of the whole concept of human resource management. It has been found that most of the successful and winning organisations have shaped their success by implementing efficient performance management systems that help in increasing the employees’ job commitment, motivation, productivity and efficiency. Performance management provides an approach that fosters a culture where incentives, opportunities and rewards are provided to those who show exceptional and continuous performance throughout the period for which the performance is being assessed (performance management and competitive advantage, 2014).

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Hire a Pro to Write You a 100% Plagiarism-Free Paper.
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Watson Wyatt Worldwide, a  giant human resource consulting firm, conducted a survey where only three respondents said that there company’s performance management system was efficient enough to measure what it was intended to measure. Further surveys have shown that only 40% of the employees feel that the company they work for had been able to clearly convey their performance expectations and generated honest feedback and without any doubt, the companies with efficient and effective performance management systems have been able to perform better than the competitive firms in the longer run. They have been able to retain and recruit better talent in the organisations and have experienced better financial results over the period of time (Anon, 2016).

Performance Management and Competitive Advantage

Performance management has been widely implemented by almost each and every company but not all companies have been able to design performance management programs that could actually bring them some kind of benefits. There are a million of examples where some of the top companies in the world have lost their competitive advantages due to the implementation of inefficient performance management systems while there are millions of companies that have sailed to the top positions due to their effective performance management systems. Performance management system can bring in competitive advantages for the company in the following ways:

  • Better talent acquisition and retention à companies that have efficient and effective performance management systems are able to foster a great positive image in the market. Freshers as well as experienced or talented employees tend to work with such companies that have better performance management systems rather than working with companies that have unrealistic or poor performance management systems. Thus, the companies with better performance management systems are able to acquire and retain better talent.
  • Increased job commitment, performance and motivation amongst the employees à when the employees realize that the scope of their promotions, incentives, rewards, etc. are dependent upon the performance that they show during the measurement period, they tend to perform better. The system of performance management provides them with an opportunity to develop their career and they become more committed towards the job and the company on the whole. Therefore, the overall performance and the productivity increases, which obviously is an added advantage to any company.
  • Fosters a competitive environment à a system of performance management can actually foster a feeling of competition amongst the employees who try to outperform their peers to gain appreciation, recognition, opportunities, promotions, incentives, etc. Such an environment prevents the workplace from becoming boring and monotonous and a competitive environment would obviously increase the productivity and performance of the employees, which would ultimately benefit the company to a great extent.
  • Better work environment and human resource management à performance management is one of the best approaches that can help in improving the work conditions and the conditions of the human resources. By measuring the performance of the employees, the management can identify the skills that the employees lack, which hinders their performance. Consequently, the management can take up necessary steps to ensure that the employees acquire the lacking skills and can contribute more towards the success of the organisation.

In this part of the assignment, we will prepare an action plan for the implementation of a performance management system in the Singapore and Hong Kong subsidiary of the Dolphin Logistics Company. First of all, let us discuss some important characteristics of a good performance management system:

  • Measureable goals and objectives à it is very important that the goals and objectives that are being developed are measureable using some metrics. If the goals and objectives are easily measurable, the process of performance management becomes much easier (Synergita Blogosphere, 2013).
  • Key Performance Indicators à the management should decide a number of key performance indicators that it would use to judge the performance of the employees. Appropriate key performance indicators would ensure that the performance management system measures the right things or the things that it is intended to measure (Smallbusiness.chron.com, 2016).
  • Should be unbiased and transparent à one of the most important characteristics of a good performance management system is that it should be totally unbiased and transparent. It should award only the deserving while the performances of the employees should be rated clearly and based on proper performance indicators. It has been found that biased performance management systems can have a great number of negative impacts on the reputation and the workforce of the company (Rollins, 2015).
  • Rewards and incentives à A performance management system is incomplete until and unless it has certain rewards or incentives to offer to the star performers of the year. Rewards and incentives are the things that the employees care about and that motivate them to perform better. Therefore, the rewards should be realistic and should be based upon the needs of the employees.

Designing a performance management system is not easy and cannot be designed by a single department in the organisation. It takes a lot of time, resource and efforts from various people in the organisation to design a good performance management system. Let us discuss the people who should be included in designing of the action plan:

  • Departmental heads à it is important to include the departmental heads from the entire organisation as it is important to include all the employees in the performance management system. The departmental heads would be able to share knowledge about their respective departments, performance metrics, employee expectations, etc.
  • Human resource managers à human resource managers have the maximum knowledge about the human resource planning and expectations of the company. Therefore, it is important to include them in the planning phase too.
  • Front line managers à front line managers are the people who the employees follow and as the implementation of a new performance management system would involve certain changes to be introduced, it is important that the front line managers are involved in the planning phase as they would act as change facilitators at a later stage.

Implementation of a performance management system involves a great effort from each and every department and hierarchical level of the organisation. It requires careful design, execution and introduction of the plan so that the plan is well communicated and the resistance to change can be minimised. The implementation should be carefully done as it involves investment of a lot of resources and efforts from the management, which must not go in vain. The various stages and the steps involved in the implementation of the performance management system are:

  • Design stage à this is the first stage in the implementation process where the performance management system is defined by the people involved in the designing phase. The design stage would consist of approximately 2 months where the management will take important decisions about the performance management system. The design process should be completed before the start of the new financial year as it would become easier for the company to measure performances annually or semi-annually. The various steps involved in the designing stage of performance management system are:
  • Ensuring support from senior management
  • Creation of implementation teams
  • Preparing the organisational gaols and objectives
  • Preparing a draft performance model
  • Identifying the critical success factor
  • Identifying the key performance indicators
  • Development of scoreboards (Imanet.org, 2016)
  • Execution stage à in this stage, the management executes the plans or the designs that it has prepared in the first stage. The implementation of the performance management system requires a lot changes to be introduced in the organisation. The front line managers would be appointed as the change facilitators and they would be given the responsibility of bringing about the change using the Kurt Lewin’s Three Phase Change Model. The execution stage will take almost a month so that the new performance management system is clearly communicated to the employees. The employees should be well aware about the criterion being used for performance management so that they know what they have to do.
  • Monitoring à once the system of performance management has been implemented in the organisation, the management would start to monitor the performance of the employees on a weekly, monthly, half-yearly or annual basis and keep a constant record of it. It would note down the performance of the employees according to the key performance indicators identified in the planning stage. From this stage onwards, all the steps in implementation are to be continuously carried out throughout the year to achieve the best results.
  • Analyse à the management would analyse the performance data collected in the third stage. One of the best ways to analyse the performances of the employees is through a 360 degree feedback. 360 degree feedback is a system where the employees receive confidential and anonymous feedback from the people who work around them, such as seniors, peers and direct reports. 360 degree feedback can provide a detailed and unbiased feedback on the performances of the employees and can help the management in accurately appraising the employees according to their performances (Custominsight.com, 2016).
  • Adapting to survive à the management would semi-annually or annually hold meetings or functions where it would discuss the performance shown by the employees and would announce the rewards, promotions or opportunities being given to them because of their performances. It is important to include rewards and opportunities for the star performers of the year as it would help in reinforcing the right behaviour within the organisation. The management would also discuss the gaps or the skills that the employees lack, which have been identified with the help of the performance management plan and how it plans to train or develop the employees so that they can acquire the lacking skills.

One of the most important components of a performance management system is the rewards that are given to the employees on the basis of their performance. The rewards in a performance management system should be correctly linked with the performances of the employees. Let us discuss some rewards for different category of employees:

  • For corporate leaders à employee stock ownership or profit sharing are the best possible rewards
  • Business Unit Leaders à for this category of employees, results sharing is the best possible reward
  • Functional leaders à this category of employees can be rewarded with milestone rewards based on their performances
  • General employees à for general employees, profit sharing, bonus or promotions are the best type of rewards (Managementstudyguide.com, 2016).

Conclusion

Performance management is one of the best concepts provided by the human resource management subjects even though some managers tend to take it lightly. Most of the managements find it difficult to continuously assess the performance of the employees while the others are not able to implement performance management systems that are efficient enough to foster a positive work environment. It is a proven fact that performance management can increase the results for a company that is able to implement properly. Therefore, it is important for all the companies to implement efficient and effective performance management systems that can foster a positive work environment in the workplace.

References

Synergita Blogosphere. (2013). 5 characteristics of an effective performance appraisal system?. [online] Available at: https://blog.synergita.com/2013/10/what-are-the-characteristics-of-effective-performance-appraisal-system/ [Accessed 5 Jul. 2016].

Smart Church Management. (2015). Advantages and Disadvantages of Performance Management. [online] Available at: https://smartchurchmanagement.com/advantages-and-disadvantages-of-performance-management/ [Accessed 5 Jul. 2016].

Imanet.org. (2016). [online] Available at: https://www.imanet.org/docs/default-source/thought_leadership/management_control_systems/tools_and_techniques_for_implementing_integrated_performance_management_systems.pdf?sfvrsn=2 [Accessed 5 Jul. 2016].

Managementstudyguide.com. (2016). Benefits of a Performance Management System. [online] Available at: https://www.managementstudyguide.com/benefits-of-performance-management-system.htm [Accessed 5 Jul. 2016].

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