PERFORMANCE

MANAGEMENT
Prof. Shabnam Siddiqui
Faculty (HR & OB)
RIMS, Rkl
 Module I
• STUDY PLAN
 Introduction & Meaning
 Basic Definitions
 What is Performance?
 What is Performance Management (PfM)?
 Concerns of PfM
 Factors affecting Performance
 History of PfM
 Features of Effective PfM System
 Nature of PfM
 Module I
 Scope of PfM
 Objectives of PfM
 Process of PfM
 PfM Theatre
 Pillars of PfM
 Link between PfM & Performance Appraisal
 Benefits of PfM
 I do the best I know how,
the very best I can;
and I mean to keep on doing it to the
end.
If the end brings me out all right,
what is said against me will not
amount to anything.
If the end brings me out all wrong,
then angels swearing I was right
would make no difference.
--- Abraham Lincoln
 INTRODUCTION & MEANING
• Two trends have emerged as major factors in the
performance of organisations in many sectors.
• These organisations ranges from business &
industry, govt., NGOs, non-profit organisations,
academics, etc.
• Managing human & organisational performance will
be central concerns in the coming decades.
• First, the processes and forces of globalisation have
shrunk the world.
 INTRODUCTION & MEANING
• Globalisation demands
more capacity to deal with differences,
greater ability to learn from experience at
local, national & international levels,
enhanced investment in recruiting,
coordinating & developing human resources
from a wide range of backgrounds.
• Second, sustained effectiveness of
organisations depends in large measure on their
ability to manage performance & develop
capacities of their human resources.
 INTRODUCTION & MEANING
• Long-term competitive advantages of
corporations depend on their abilities to attract,
manage, develop and retain high quality talent.
• The only way to generate enduring profits is to
build the kind of work environment that attracts,
focuses on, and retains talented workers.
• PfM is an area that has attracted interest from
all kinds of organisations.
• Most organisations have begun to define and
 INTRODUCTION & MEANING
assess managee performance through
measurable indices and visible behaviours
that spell high performance.
• They also emphasise development of
managee potential in terms of systematically
analysed competencies that are essential for
effective job performance, present as well
future.
• PfM begins by understanding the
organisational, the departmental, the unit or
the project goals for the year.
 INTRODUCTION & MEANING
• It then works out what people at different
levels in the organisation must do --- produce
or deliver --- for these goals to be met.
• Desired outcomes determine the kind of
people that an organisation needs, the roles
they must perform, and the results they must
individually and collectively achieve.
 INTRODUCTION & MEANING
• PfM is about enabling managees to perform
better in order to succeed.
• This means creating a motivating work
environment through appropriate incentives,
feedback & rewards: encouragements for
wanting to do a better job.
• This also means innovations in leadership
and an overall organisational climate that
exudes optimism and high-performance
expectations.
• PfM is ultimately about communication:
communicating what is expected from people
 INTRODUCTION & MEANING
people and how best this can be achieved,
allowing individuals to develop themselves
and their contribution to the organisation.
 BASIC DEFINITIONS
1. Performance
The achievement of an employee against the
expectations from his/her role along clearly
defined targets for the year is what
constitutes the individual’s performance.
• Organisational requirements based on
company goals
• Role areas of the individual position
2. Competency
This is a combination of the knowledge, skill
and attitude required for an individual to
 BASIC DEFINITIONS
effectively perform in a role.
3. Potential
The capacity of the individual to handle
higher responsibilities based on his/her
overall abilities and current competency
levels.
 WHAT IS PERFORMANCE?
• It can be regarded as simply the record of
outcomes achieved.
• Performance means outcomes achieved, or
accomplishments at work --- the actual
contribution of an individual or team to the
organisation’s strategic goals.
• Campbell believe that performance, as
behaviour, should be distinguished from its
outcomes, because the outcomes can be
contaminated by systems prevalent in the
organisation.
 WHAT IS PERFORMANCE?
• Brumbach views performance more
comprehensively by encompassing both
behaviours and results.
• A manager, therefore, needs to consider both
inputs (behaviours) and outputs (result) when
managing the performance of teams and
individuals.
• The role of any managee can be seen in three
parts: Being, Doing, and Relating.
• ‘Being’ concerns the competencies of the
managee that are relevant to performance. It
 WHAT IS PERFORMANCE?
means that the managee has prepared her
mind.
• ‘Doing’ focuses on the managee activities
that are variably effective at different levels in
the organisation.
• ‘Relating’ emphasizes the nature of
relationships with members of the role
network--- vertical, horizontal or otherwise.
 PERFORMANCE FRAMEWORK
Any performance framework would respond to the
following sequence:
INPUT THROUGHPUT OUTPUT

Task-related Managee
Managee
Activities and Performance or
Potential
Context Effectiveness

Feedback

Feedback
 PERFORMANCE FRAMEWORK
• Managee potential is determined when a set
of tasks is allocated to a managee, or certain
performance expectations are set.
• Task-related activities & context are what a
managee or her/his supervisor indulge in to
achieve the allocated tasks.
• Managee performance or effectiveness is
what the managee actually achieves.
 PERFORMANCE MANAGEMENT (PfM)
• Effective management of human performance in an
organisation is very much needed in the fast changing
technology oriented world.
• PfM is a step taken by the organisations to keep track of their
goals being met consistently in an effective & efficient manner.
• It involves not only evaluation of performance
but also involves managers who work as a team with the
employees to improve their future performance.
• PfM does not stop with assessment and evaluation of the
performance but also goes beyond that by providing
meaningful feedback, collaborating with employees
PERFORMANCE MANAGEMENT (PfM)
to solve their performance problems and help
them in developing improved levels of
performance.
• Performance = ability + motivation
 PERFORMANCE MANAGEMENT
• Performance management (PfM) is a
strategic and integrated approach to
delivering sustained success to
organisations by improving the
performance of the people who work in
them and by developing the capabilities of
individual contributors and teams.
1. Strategic: it is concerned with the broader
issues facing the business, and the general
direction in which it intends to go to achieve
longer-term goals.
2. Integrated in four senses:
 PERFORMANCE MANAGEMENT
i. vertical integration --- linking or aligning
business, team & individual objectives,
ii. functional integration --- linking functional
strategies in different parts of the business,
iii. human resource integration --- linking
different aspects of HRM, especially O.D.
and HRD & reward, to achieve a coherent
approach to the management and
development of people,
iv. integration of individual needs --- with those
of the organisation.
3. Improving performance : concerned with
 PERFORMANCE MANAGEMENT
performance improvement in order to
achieve organisational, team and individual
effectiveness. Management is involved in
direction, measurement and control but
these are not the exclusive concerns of
managers; teams and individuals jointly
participate as stakeholders.
4. Development: this is perhaps the most
important function of PfM. Continuous
development addresses the core
competences of the organisation and the
capabilities of individuals and teams.
 CONCERNS OF PfM
1. Concern with outputs, outcomes, process
and inputs : PfM is concerned with outputs
(the achievement of results), outcomes (impact
made on performance), processes
(competencies) required to achieve these
results and the inputs (in terms of capabilities
i.e. knowledge, skill, etc )
2. Concern with planning : Looking ahead to
achieve future success. This means defining
expectations expressed as objectives.
3. Concern with measurement & review : PfM is
concerned with the measurement of results
 CONCERNS OF PfM
and with reviewing progress towards
achieving objectives as a basis for action.
4. Concern with continuous development
and improvement : PfM is concerned with
creating a culture in which organisational &
individual learning and development are a
continuous process.
5. Concern for communication : Create a
climate in which a continuing dialogue
between managers and the members of
their teams takes place to define
expectations and share information on the
organisation’s mission, values & objectives.
This establishes mutual understanding of
 CONCERNS OF PfM
what is to be achieved and ensuring that it will
be achieved.
6. Concern for stakeholders :