ARTICLE: How to Evaluate a Performance Management System

Performance management system (PMS) is an essential function of the human resource management of any company. Organizations invest a lot of money to train their employees, and in return, a hike in productivity is expected from the employees. An immense amount of time and resources are invested in making the processes smooth and productive. Performance management system is the process of creating a conducive environment for working so that the employees can unleash their actual potential and perform at their maximum efficiency.

For an effective performance management system, the first and foremost requirement is well-defined job responsibilities for every task which has to be performed to meet a target. When there will be written job responsibilities, then it will be easier for the organisation to formulate job specifications so that those essential responsibility areas can be fulfilled. The job specifications are the skill sets which are required to do a particular job efficiently. The performance of a person can only be evaluated if these both things are clear in the employee's mind. This also gives a platform to the organisation to base their evaluative criteria.

THE BENEFITS OF PERFORMANCE MANAGEMENT SYSTEM

An effective PMS offers many benefits to the organizations which are written as below:

  • It gives the idea about the gap in performance in what is being delivered and what is expected.
  • The results of the performance management process provide the data to be used for the training and development of the employees.
  • With the help of the outcomes of a PMS, the management can decide about the compensation and benefit plans.
  • It can also give an insight into the attrition of the people if its rates are higher in a company.

For an objective assessment of the performance system you should keep the following points in mind:

RESEARCH AND KNOW ABOUT THE INDUSTRY BENCHMARKS

The industry benchmarks are essential to understanding to create a highly productive performance management system for any company. The human resource managers should read the best practices which are prevalent in the current scenario. Then it is also essential to analyse the current methods for the PMS in the firm. The latest research studies and case studies on PMS of successful companies created by management scholars are excellent sources to know about the current PMS best practices.

THE CLARITY OF THE ORGANIZATIONAL GOALS IS NECESSARY

There are two set of goals in a clearing organization and that are the organization a strategic objectives and the individual goals which are designed to achieve the overall objectives of the company. This is the responsibility of the human resource manager to create coherence and congruence between these two goals. The organizations which succeed in striking a balance between these two types of target, eventually succeed in creating a growing and conducive work environment for its employees and a steady growth for itself. The organizational goals for assessing its performance management can be as following:

  • To enhance the overall productivity of the firm
  • The alignment of individual goals of the employees with the organizational goals
  • To create a performance culture by building high performing teams
  • Adjustment of the personal behaviour of the people with the corporate values of the firm
  • To transform the organization into a learning organization
  • To develop plans for improving individual performance
  • To strategies a training program for the employees according to the performance discrepancies
  • Ask the employees about the success of the PMS of the organization

The best and instant feedback comes by knowing the viewpoint of the employees about the performance of the firm. The interview can be conducted with a pool of associates or a questionnaire having questions about the productivity of the PMS of the company can be circulated in all the departments. To get authentic information, the questionnaires can be kept anonymous so that employees can say what they feel without any hesitation.