Performance of the employees is the key factor in the success of any business enterprise. It can make or break a company – be it in the production department or marketing or sales. Having a comprehensive system that looks after the performance evaluation of employees is needed by every organisation. That is where Performance Management System comes in.
What is Performance Management System?
A Performance Management System helps the company to attain the organisational as well as individual goals set down by the top brass administrators. Its main objective is to keep track of all the individual employees and their overall contribution to the department, to the project groups they are part of and to the organisation on the whole.
This forms the basis of job evaluation and employee management system which helps in determining the success of the HR management.
The importance of Performance Management System
The important aspects of a good Performance Management System include the following:
1. Goals and targets
It obviously takes into consideration the overall and individual objectives delegated to each employee and what exactly their role is in the big picture. Without the benchmark of a target, there will be nothing to match the employee’s contribution with to do the right evaluation and review of performance. It is to be kept in mind that the individual goals should be fair and realistic and in lines with the corporate ones.
2. Good communication
A good performance management system must have a clear and transparent communication in both directions of the flow. Superiors must convey the targets in specific strategic facts and the feedback coming from the Employees should also be the same. It helps in fighting ambiguity and opaqueness which are quite harmful and ahindrance to actual progress.
3. Balance between flexibility and control
The employees need to be allowed a certain degree of autonomy and flexibility to attain the goals in the ways best suitable for them. But at the same time, there must also be a control put on by the authority to a certain extent that follows thehierarchical command-compliance system. Only then there will be an equal and healthy balance between the two.
4. Continuous employee performance review
By continuous we do not mean daily, but rather a generic sense of frequency at which rate the employees are to be notified of their progress or lack of it and how it is being considered by the organisation. Performance evaluation is quite pointless if the concluded information about the employee contribution is kept with the authorities and not shared with the individuals – without feedback or a benchmark of expectation, their performances are not likely to get better on its own.
5. Action on performances
The most important aspect of employee, performance management system, is the consequence of it. The organisation must take action on whatever evaluation comes forward – if it a negative one then the employee must be held accountable,and if it is a positive one, then they must also be rewarded.
Performance management system in an organization helps in detailing of goals and helps the organization to identify poor performances and allows them to come with ideas to tackle these problems.
