Implementing performance management

1. Implementing performance management
Performance management is about controlling the performance of the organization. Most
of the time this starts by the financial figures that are set as a guide for the company. We
target a certain return on investment, an efficiency ratio or a profit per share ratio. These
ratios provide a guide for management because they represent real targets.
The challenge is to link these financial figures to personal objectives, or personal
performance criteria. Compare this with a project planning. The (overall) company ratios
could be seen as the deadline of the project that you set at a certain point in time, but you
still have no idea whether your human resources are able to finish this project, nor what
would be a reasonable (resource) benchmark for this project to finish.
But the law of the market defines that we first set our target and then we assess whether
we will make it. Pressure is a good friend in business but incredible deadlines will de-
motivate.
The productivity matrix will help you in this area, because productivity is measurable at
any level and takes into account the direct and indirect contribution to the output. But
also in this case you should only implement such a heavy (performance) measurement
system if you are going to finish it. The comparison with project management is again
very useful; you should (only) implement project management when the risk of missing
such a mechanism is bigger than the overhead (costs) that you add to your business.
A step towards a formal performance management system is to address those issues that
are key for your business. And these are normally also the issues that are not easily to set
performance indicators for. Image that your football team is losing. The performance
target is not met. But then, what could have been improved; the defense, the attack or
somewhere in the middle, connecting both ...? If you know this, you know how to
improve your performance.
http://performanceappraisalebooks.info/ : Over 200 ebooks, templates, forms for
performance appraisal.