Performance management is the systematic process by which an agency involves its employees, as individuals and members of a group, in improving organizational effectiveness in the accomplishment of agency mission and goals. Employee performance management includes:
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planning work and setting expectations, continually monitoring performance, developing the capacity to perform, periodically rating performance in asummary fashion, and rewarding good performance.

The revisions made in 1995 to the Governmentwide performance appraisal and awards regulations support sound management principles. Great care was taken to ensure that the requirements those regulations establish would complement and not conflict with the kinds of activities and actions practiced in effective organizations as a matter of course. Additional background information on performance management can be found in the following articles:
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Chronology of Employee Performance Management in the Federal Government Setting the Stage for Performance Management Today

In an effective organization, work is planned out in advance. Planning means setting performance expectations and goals for groups and individuals to channel their efforts toward achieving organizational objectives. Getting employees involved in the planning process will help them understand the goals of the organization, what needs to be done, why it needs to be done, and how well it should be done. The regulatory requirements for planning employees' performance include establishing the elements and standards of their performance appraisal plans. Performance elements and standards should be measurable, understandable, verifiable, equitable, and achievable. Through critical elements, employees are held accountable as individuals for work assignments or responsibilities. Employee performance plans should be flexible so that they can be adjusted for changing program objectives and work requirements. When used effectively, these plans can be beneficial working documents that are discussed often, and not merely

improving work processes. organizations find it useful to summarize employee performance. Providing employees with training and developmental opportunities encourages good performance. strengthens job-related skills and competencies. And by monitoring continually. employee developmental needs are evaluated and addressed. Developing in this instance means increasing the capacity to perform through training. deficiencies in performance become evident and can be addressed.paperwork that is filed in a drawer and seen only when ratings of record are required. Carrying out the processes of performance management provides an excellent opportunity to identify developmental needs. In an effective organization. Monitoring well means consistently measuring performance and providing ongoing feedback to employees and work groups on their progress toward reaching their goals. or other methods. Regulatory requirements for monitoring performance include conducting progress reviews with employees where their performance is compared against their elements and standards. From time to time. In an effective organization. Areas for improving good performance also stand out. such as the introduction of new technology. giving assignments that introduce new skills or higher levels of responsibility. During planning and monitoring of work. assignments and projects are monitored continually. and action can be taken to help successful employees improve even further. unacceptable performance can be identified at any time during the appraisal period and assistance provided to address such performance rather than wait until the end of the period when summary rating levels are assigned. Ongoing monitoring provides the opportunity to check how well employees are meeting predetermined standards and to make changes to unrealistic or problematic standards. This can be helpful for looking at and comparing performance over . and helps employees keep up with changes in the workplace.

High standards are set. Good performance is recognized without waiting for nominations for formal awards to be solicited. A basic principle of effective management is that all behavior is controlled by its consequences. In effective organizations. The regulations also cover a variety of contributions that can be rewarded. The rating of record has a bearing on various other personnel actions. awards regulations provide a broad range of forms that more formal rewards can take. for their performance and acknowledging their contributions to the agency's mission. All five component processes working together . rewards are used well. Rewarding means recognizing employees. A lot of the actions that reward good performance — like saying "Thank you" — don't require a specific regulatory authority. time off. and many nonmonetary items. The rating of record is assigned according to procedures included in the organization's appraisal program. Goals are set and work is planned routinely. Note: Although group performance may have an impact on an employee's summary rating. individually and as members of groups. such as cash. rating means evaluating employee or group performance against the elements and standards in an employee's performance plan and assigning a summary rating of record. from suggestions to group accomplishments. Nonetheless. a rating of record is assigned only to an individual. In an effective organization. managers and employees have been practicing good performance management naturally all their lives. Progress toward those goals is measured and employees get feedback. Within the context of formal performance appraisal requirements. but care is also taken to develop the skills needed to reach them. such as granting within-grade pay increases and determining additional retention service credit in a reduction in force. natural part of day-to-day experience.time or among various employees. Those consequences can and should be both formal and informal and both positive and negative. Formal and informal rewards are used to recognize the behavior and results that accomplish the mission. executing each key component process well. Recognition is an ongoing. Managing Performance Effectively. Organizations need to know who their best performers are. not to a group. It is based on work performed during an entire appraisal period.

that they ensure the people or teams they manage: • • • • know and understand what is expected of them have the skills and ability to deliver on these expectations are supported by the organisation to develop the capacity to meet these expectations are given feedback on their performance have the opportunity to discuss and contribute to individual and team aims and objectives. culture.ensuring that individuals are encouraged to behave in a way that allows and fosters better working relationships.it is about broader issues and longer-term goals Integrated . likewise individuals and teams can communicate their expectations of how they should be managed and what they need to do their jobs.it should link various aspects of the business.' In other words performance management should be: • • Strategic . team and organisational effectiveness Development . and individuals and teams. In their definitive text1 upon which this factsheet is based. Armstrong and Baron define performance management as 'a process which contributes to the effective management of individuals and teams in order to achieve high levels of organisational performance. for individual. So performance management is about establishing a culture in which individuals and groups take responsibility for the continuous improvement of business processes and of their own skills. it establishes shared understanding about what is to be achieved and an approach to leading and developing people which will ensure that it is achieved'. It follows that performance management is about interrelationships and about improving the quality of . It is about sharing expectations. It should incorporate: • • • Performance improvement . Armstrong and Baron stress that at its best performance management is a tool to ensure that managers manage effectively.and supporting each other achieve natural. behaviour and contributions. Managers can clarify what they expect individual and teams to do. It is also about ensuring that managers themselves are aware of the impact of their own behaviour on the people they manage and are encouraged to identify and exhibit positive behaviours. As such. style and communications systems.unless there is continuous development of individuals and teams. people management. effective performance management. They go on to stress that it is 'a strategy which relates to every activity of the organisation set in the context of its human resource policies. The nature of the strategy depends on the organisational context and can vary from organisation to organisation.throughout the organisation. performance will not improve Managing behaviour .

It is also about planning . It should apply to all employees. churches. as well as an individual . Workers who have not contributed enough may be counseled on how to improve performance. It is a continuous process. Last but not least. not a one-off event.and about measurement. Over time.anywhere in the world people interact with their environments to produce desired effects. governmental agencies. This can be done by having quarterly or annual evaluations of employee output as well as the company's overall ability to meet goals. and to teams as much as individuals. Performance management objectives also include the overall evaluation of a company and its ability to follow through with setting and reaching goals. performance management is now as much about driving engagement and collecting information and data to provide better insight into the drivers of performance as it is about providing information about individuals. behaviour and capability. and is therefore a joint process. and which employees contributed the most to making these things happen.relationships . to individual contribution to organisational objectives through output. Armstrong and Baron (1998) defined it as a “strategic and integrated approach to increasing the effectiveness of organizations by improving the performance of the people who work in them and by developing the capabilities of teams and individual contributors. between members of teams and so on. community meetings.” It may be possible to get all employees to reconcile personal goals with organizational goals and increase productivity and profitability of an organization using this process. can apply wherever people interact — schools. there will be widespread company meetings where managers and employees can discuss concerns and solutions to problems. sports teams. new clients acquired. Often. after an evaluation. See our recent publications which review how the practice of performance management has evolved since the early ‘90s and look at the current trends and practice. and even political settings .defining expectations expressed as objectives and in business plans . It can be applied by organisations or a single department or section inside an organisation. the focus and emphasis of performance has shifted away from individual output to inform development or pay decisions. Performance Management Objectives The primary performance management objectives include uncovering the strengths and weaknesses of employees and departments and finding ways to remedy shortcomings. Where PM is applied The PM approach is used most often in the workplace. This can be done by looking at profits earned. it is holistic and should pervade every aspect of running an organisation.between managers and individuals. not just managers. One of the main performance management objectives is to discover where a company and its employees are falling short. the old dictum is 'If you can't measure it. between managers and teams. health setting. As such. you can't manage it'.

e. If a job description is not available. operational efficiency benefits and by unlocking the latent potential in every employees work day (i. The job mission statement is a job definition in terms of purpose. not just business as usual Improves employee engagement because everyone understands how they are directly contributing to the organisations high level goals Create transparency in achievement of goals High confidence in bonus payment process Professional development programs are better aligned directly to achieving business level goals Improved management control . a commitment analysis must be done where a job mission statement is drawn up for each job. rather than a spreadsheet based recording system. [edit] Benefits Managing employee or system performance facilitates the effective delivery of strategic and operational goals. then a systems analysis can be done to draw up a job description. customers. product and scope. The aim with this analysis is to determine the continuous key objectives and performance standards for each job position. the time they spend not actually doing their job).[citation needed] First. The aim with this analysis is to determine the continuous critical objectives and performance standards for each job. may deliver a significant return on investment through a range of direct and indirect sales benefits. The performance process is appropriately named the self-propelled performance process (SPPP). using integrated software. There is a clear and immediate correlation between using performance management programs or software and improved business and organizational results.person. For employee performance management. Benefits may include: Direct financial gain • • • • • Grow sales Reduce costs Stop project overruns Aligns the organization directly behind the CEO's goals Decreases the time it takes to create strategic or operational changes by communicating the changes through a new set of goals Motivated workforce • • • • • Optimizes incentive plans to specific goals for over achievement. Following the commitment analysis is the work analysis of a particular job in terms of the reporting structure and job description.

job descriptions. training. identification of performance requirements. • a consistent link between the goals and objectives set for the agency and the employee. PERFORMANCE MANAGEMENT . 7. and • for employees to achieve personal growth through acquiring relevant knowledge and skills and attitudes. selection process. . and is not to be placed on the employee’s personnel file). induction. • to assist employees to identify knowledge and skills to perform their job efficiently. identify performance requirements. The management of medical incapacity. performance management should be seen as a totally integrated system of personnel management. performance feedback and counselling. responsive to management needs Displays data relationships Helps audit / comply with legislative requirements Simplifies communication of strategic goals scenario planning Provides well documented and communicated process documentation 6. The primary objectives of performance management are: • to assist in the achievement of enhanced standards of work performance of an employee or class of employees. • for employees to work towards defined goals. PERFORMANCE MANAGEMENT SYSTEMS Performance management systems are designed to clarify objectives. The following features should be considered by Chief Executive Officers for inclusion in performance management systems: • an education strategy to ensure supervisors and employees are informed of the agency’s performance management system before participating in the program. assist in the management of individual employee performance and plan relevant training and development programs. inability to discharge duties and disciplinary processes are separate from an agency’s performance management system and are to be seen as separate. Effective performance management is designed to enhance performance. Personnel management includes job and work design. • for employees to receive regular feedback on performance. Consistent with the primary objectives. provide feedback relevant to those requirements and assist with career development. • a process that ensures complete confidentiality of all documentation associated with the planning and review of any employee’s performance (associated documentation should only be available to the employee. devalue or discriminate against any individual on the basis of gender. evaluating and developing the work performance of employees so that the agency’s goals and objectives are more effectively achieved. the employee’s supervisor and the supervisor’s manager.• • • • • Flexible.OBJECTIVES Performance management is the process of identifying. cultural background or any other attribute not relevant to the workplace. • a process that does not disadvantage. effective supervision.

evaluating and discussing performance with each employee. 8. • proper matching of people and jobs (improved selection techniques). 2. A good performance management system will help identify such factors and an integrated approach to personnel management within an agency should provide mechanisms for dealing with them. such as: • adequacy of supervision. Definition Performance management is an ongoing. • personal/family circumstances. continuous process of communicating and clarifying job responsibilities. • an identification of attitudes. education and development programs. and • medical considerations. SCOPE AND PURPOSE This Employment Instruction sets out the minimum requirements for the development and implementation of performance management systems in agencies. Performance Management involves clarifying the job duties. • interpersonal relationships within the immediate or work related area. • possession of necessary skills to perform the tasks efficiently. LEGISLATIVE BASIS Sections 24(f). and documenting. priorities and performance expectations in order to ensure mutual understanding between supervisor and employee. defining performance standards. It is a philosophy which values and encourages employee development through a style of management which provides frequent feedback and fosters teamwork. job design. induction. 1. The structure of systems will differ between agencies and will reflect the needs of employees and the respective agencies. OTHER MATTERS TO BE CONSIDERED Many factors may be considered when seeking to enhance performance. It emphasizes communication and focuses on adding value to the organization by promoting improved job performance and encouraging skill development.• a clear statement of goals and objectives for each employee at the beginning of each evaluation period and the provision of feedback on individual performance against the set objectives. 24(g) and 28(g) of the Public Sector Employment and Management Act (the Act). adequate evaluation and feedback. • organisational factors such as job definition. knowledge and skills for effective individual performance and plans for staff to undertake relevant training. and • timely evaluations which reflect a fair assessment of an employee’s performance during the specified period based on the set objectives. . The Office of the Commissioner for Public Employment will provide advice and assistance to agencies on performance management systems on request.

3. and pay for performance. succession and strategic planning.edu/~uhrs/training/performance_management/intro.Objectives The objectives of Performance Management are to: 1.pdf http://www.uk/subjects/perfmangmt/general/perfman.opm.gov. responsibilities.asp http://www. priorities and expectations Identify and resolve performance problems Recognize quality performance Provide a basis for administrative decisions such as promotions. goals.gov/perform/overview. Increase two-way communication between supervisors and employees Clarify mission.au/__data/assets/pdf_file/0004/9796/ei04.cipd.co.htm http://www. 4.indiana. 5. ww.nt.ocpe.htm . 2.

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