HR Training / Performance Management - What, Why & How?


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HR Training Performance Management

Performance Management - What, Why & How?

When we talk about the five dimensions of Human Resource Management (HRM), we list down the following, namely,
  • Performance Management,
  • Career Management,
  • Recruitment & Selection,
  • Training & Development, and
  • Compensation & Benefits Management.
These five dimensions, though equally important, often fail to secure equal attention from Human Resource (HR) managers. The facts that performance management is not just an annual performance appraisal and training is not the only solution to effective performance are forgotten by the HR managers and the management team. As a result, successful organizations, happy with their existing success status, are actually deprived of a potential growth that could have been achieved should they have invested more attention to performance management than only performance appraisal. For instance, the total HR performance of your company is worth $10, which means your employees’ performance is resulting revenue worth $10. Among this set of employees, some are excellent performers, some are good, some moderate and some poor. This difference in performance level are due to the fact that some are using 100% of their potentials, some working below their full potentials and some working at zero or marginal potentials. The challenge of equalizing the difference in performance level lies in an objective performance management system.

What Performance Management Is Not:

- it’s not just an annual performance appraisal
- it’s not imposing targets/goals on an employee by his supervisor
- it’s not only evaluating individual job performance

What is Performance Management:

- it’s Management By Objectives (MBO)
- it’s about setting SMARTER goals
- it’s about planning to perform
- it’s about periodically reviewing progress in performance
- it’s about evaluating performance for further improvement
- it’s about delivering reinforcement for performance success and performance failure

What is the Performance Management Process/Cycle”:

The Performance Management Process begin and ends in the same cycle of events which are as follows:

- Individual goal setting
- Performance planning
- Mid year performance review
- Annual performance appraisal

Under individual goal setting, the supervisor and the employee will sit together to set annual goals at the year end; the goals are to be achieved by the employee at designated quarters of the following year.

Under performance planning, the supervisor and the employee, during the same goal setting session, will plan on how to perform in order to achieve the goals most effectively and efficiently.

In the middle of the following year, the supervisor will review the employee’s progress and achievements, advise and coach for better performance, give recognition and appreciate for achievements so far and make changes in the performance plan, if required; the progress of employee shall tell the supervisor whether or not the all preset goals can be achieved in the given year.

At the year end, the supervisor and the employee will sit together to appraise the employee’s performance in the given year and the feedbacks will all be fed into setting new goals and action plans for the following year.

You may find the performance management process pretty easy, however, implementing each phase of it requires an understanding of how individual performance of all employees can translate into total organizational performance. As regard to this, managers need to ask themselves the following questions:

What does the company want to achieve in the long run? Gain insight into the corporate vision
What business does the company has to be in to achieve its vision? Gain insight into the corporate mission
What will be the strategy to sustain in that business? Formulate corporate strategy
What are the functional objectives supporting the strategy? Set functional objectives

Performance Appraisal Methods

A large numbers of performance appraisal methods have been devised over the years. The methods are categorized as traditional and modern methods. All the methods are explained in brief here under:-

Traditional Methods
  1. Ranking Method.
  2. Paired Comparison Method
  3. Grading
  4. Graphic Rating Scales
  5. Check List Method
  6. Forced Choice Method
  7. Forced Distribution Method
  8. Free Form Essay Method
  9. Critical Incident Method
  10. Behaviorally Anchored Rating Scales
  11. Group Appraisal Method
  12. Field Review Method

Modern Methods
  1. Assessment Center
  2. Management by Objective
  3. Psychological Appraisal
  4. 360o Feedback Method