Chapter 7

Presented by
Md. Anamul Haque
Lecturer,
Dept. of Management Studies
Comilla University
 Performance Management
‘Performance’ refers to what an employee does or does not on the
job. Employee performance includes, for example, quantity of
output and quality of output.
Performance management is defined as an integrated process that
consolidates goal setting, employee development, performance
appraisal, and rewarding performance into a single common
system.
The aim of performance management is to ensure that employee
performance supports the strategic goals of the organization.

Thus, performance management integrates management of

organizational and employee performance.
 Performance Management
“Performance management is a continuous process which
contributes to the effective management of individuals and teams
in order to achieve high levels of organizational performance. It
involves performance reviews focusing on the future rather than
the past.”
-Baron and Armstrong (1998).
“Performance Management (PM) entails activities that
organizations implement with the aim of ensuring its goals are
achieved consistently and efficiently.”
-Alder (2004).
Therefore, Performance Management is to ensure that
organizational strategies are implemented effectively in order to
facilitate the achievement of organizational goals.
Comparison of Performance Management and Performance Appraisal
Characteristics Performance Management Performance Appraisal (PA)
(PM)
Performance Management is the Performance Appraisal means the
Meaning management of human resources analysis of an employee's performance
in an organization. and their caliber for future growth and
development.
What is it? It is a process. It is a system.
Nature Supple Rigid
Type of tool Strategic Tool Operational Tool
Owned by Managers Human Resource Department
Conducted Continuously Annually
Approach Holistic Individualistic
Focused on Qualitative Aspects Quantitative Aspects
Corrections Prospective Retrospective
Uses and Objectives of Performance Management System
Classification of Performance Management Objectives
Evaluative Objectives:
 Measures employee performance for making
administrative decision which are related to selection
validity, salary increases, bonus, promotions,
rewards etc.
 Manager acts as a judge of employee performance
and make differential rewards decisions like
promotion, incentives, bonus, reward etc.
Development Objectives
 Facilitate the development of employees skills and
motivation for future performance. This objectives
focus on employee career growth and potential
development through feedback, motivation,
training, career planning, HRP.
 Manager acts as a coach or counsellor. A coach
rewards good performance with recognition explains,
where improvement is necessary and shows
employees how to improve
Conflict between Evaluative and Development
Objectives
 While designing performance management
system, sometimes organization wants to
achieve both objectives together. At that time
conflict occurs like……
 Ambiguity
 Error
 Defensiveness
Process of Performance Management System
Sources of Appraisal Information
Methods of Performance Appraisal
Factors Leading to problems in Performance Management System
Characteristics of Effective Performance Management System
Developments in Performance Management System
Appreciate the role of Technology in the Performance
Management Process
Technology can be used to enhance the positive outcomes of a
well-administered performance management system.
Technology may contribute to the performance appraisal process
in two ways:

1. Computer Performance Monitoring (CMP)

2. Online Evaluation and Appraisal Software
 Computer Performance Monitoring (CMP)

 The CPM technology helps in collecting performance

data by counting the number of work unit
completed in a time period, error rates, time spent
on various tasks, etc. The organization can use data
for workforce planning, evaluating worker
performance, controlling performance and providing
performance feedback to employees
Online Evaluation and Appraisal Software

Online evaluation and appraisal software helps

generate appraisals and the accompanying narrative
and also facilitates the delivery of performance
feedback. The Internet or the Intranet of the
organization can be used for administering the
performance management system.
Strategic Linkage of Performance Management
Organizational Competitive Organizational Needed HR Aligning
Life Cycle Status of the Strategies Employee Strategy Performance
Firm Characteristics Management
(Competitive
Advantage)
Inception (start- Weak Value Creation Innovative Focus on Qualitative
up) Risk-Taking exploratory methods
Long-term Knowledge
orientation of
Employees
Growth Strong Value Flexibility Focus on Quantitative
Accumulation Co-operative exploitative methods
Knowledge
Maturity Stable Value Efficiency Harvest Qualitative
Maintenance Results with strategy to methods
low level of risk maintain
competitive
status
The Strategic Performance Management System
includes the following steps:

 Identify competitive status of the firm

 Determine organizational and HR strategies
 Align the performance management system
THANKS TO ALL……….

ANY QUESTIONS
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