Managing and Organising

EXAM
Question 1 :
Examine why performance management is a necessary but often difficult process in organisations
Theme: Managing Performance
Reading: Collinson (1988) Joking in the workplace
Question 2: Downsizing
Reading: Thornhill and Saunders and Lewins Force Field Analysis
Question 3: Workplace Stress
Worklife Balance

Question 1
Examine why performance management is a necessary but often difficult process in organisations
Performance management is regarded by Armstrong and Baron (1998) as a necessary measure in
order to improve the effectiveness and efficiency of a business. Arnold et al (2010) state that
performance appraisal is one element that can be used to manage performance, it is necessary in
order to ensure individuals performance is contributing to business goals. Performance management
methods such as performance appraisal are necessary for two key purposes according to Bratton
and Gold (2012) ; control purposes and developmental purposes these will be explained within the
essay. It is believed that performance management allows managers to gain a better understanding
of their workforce and ensure employees are working towards company objectives, however this is
not a simple task. This essay will draw upon Collinson (1988)s research showing how employees
react to performance management and show some of the key difficulties faced by managers trying
to implement this process. This essay will also look into the role of reward management and the
difficulties managers face with regards to performance management when linked to reward
management. To conclude the essay will review the ways performance management is used within
organisations and seek to explain why it is a necessary process while discussing the key difficulties
that stand in the way of managers attempting to conduct performance management.

Armstrong and Baron (1998) said that performance management is a strategic and integrated
approach to try and increase effectiveness and employee performance. One way of conducting
performance management is by using performance appraisal; Arnold et al (2010) said that this is a
mechanism to ensure individuals performance is contributing towards business goals. Bratton and
Gold (2012) went on to describe it as a process whereby managers analyse past and current work

performance. It can be seen as a necessary purpose for managers as it allows managers to clarify
and define performance expectations, identify training and development needs and allocate
financial rewards to those performing well. Bratton and Gold (2012) said there are two main reasons
why performance management is necessary for organisations: control and development. Control
purposes allow managers to evaluate workers and make decisions based on pay, promotions and
work responsibilities. Development purposes, performance management allows managers to make
decisions regarding training and aim to improve employee performance. There are a number of
different methods that managers can use when conducting performance appraisal; trait methods,
objective based methods and competency methods, each method has its own downfalls however,
for the purpose of this essay the focus will be on performance management as a whole.
Performance management is closely linked to reward management and is necessary as it allows
managers to determine which employees deserve rewards, as stated by Bratton and Gold (2012). It
is necessary in selecting those employees that shall receive either financial or non-financial reward
however, it is often a difficult process in defining what good performance is as Wright (1991) said a
lot of the time the meaningful is not measureable and the measurable not meaningful. It is also
difficult to determine which sort of reward to give to the employee, these could be financial such as
pay or non-financial such as recognition and job security. It could be said that the non-financial
aspects are part of the Psychological Contract (Hilltrop,1995) and therefore may not be seen as a
reward to performance.
When attempting to conduct performance management managers are faced with a number of
difficulties, Arnold et al (2010) stated that it is difficult to manage performance as in reality it is a
complex social interaction with different and competing needs and views. As many of the methods
of performance management require either monitoring employees closely or asking emoloyees to
score themselves it is a very subjective process which managers do not enjoy. Mcgregor (1957)
suggested that managers dislike playing God, this shows how managers find it difficult to make
decisions based on reviewing performance and do not enjoy the process. As mentioned earlier it is
difficult for managers to measure what good performance is and as it is a subjective process this
can lead to discrepancies between managers and employees. If employees are dissatisfied with the
performance appraisal this can lead to negative attitudes and behaviours (Brown et al, 2010), this
also shows how it is difficult to achieve the objectives of performance management.
Managers dont only face difficulties in how performance is monitored they also face difficulties with
employees reactions to performance management. Hyman (1987) suggested that there are tensions
between control and consent for managers and employees, managers need to attempt to secure
compliance however this is a difficult process. Collinson (1988) found that employees did not like
constantly being monitored and assessed and therefore turned to sabotage which has a
detrimental effect on the performance of the organisation. As the aim of performance management
is to improve efficiency and employee effectives this clearly shows one of the difficulties faced by
managers tried to implement performance management strategies. Some employees see the
increased scrutiny as undermine their professional autonomy and it could be said that this therefore
conflicts with their Psychological Contract (Hilltrop, 1995). Brown and Benson (2003) suggested
that sometimes too much performance management can lead to exhaustion of employees as they
are constantly under pressure, this could lead to stress in the workplace. Kinman and Jones (2005)
found that stress in the workplace can lead to absenteeism, poor concentration and poor overall

performance which conflicts with the objectives of performance management adding to the
difficulties managers face.
It can be seen that performance management is a necessary tool for managers in order to obtain
control and assist in development (Bratton and Gold, 2012). It can also be seen that it is a necessary
measure with regards to reward management. It has been shown however, that it is not a simple
process. Managers face a number of difficulties with regards to conduction performance
management and the reaction of employees. Collinson (1988) showed how employees reacted to
constant scrutiny showing how difficult it is to achieve the objectives set by performance
management. The essay gives you a clear understanding of why performance management is
necessary and the problems that managers face when trying to implement this strategy within a
business.