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P FOR ER MANCE MANAGEMENTJOSHIN THOMAS CHERIAN SIMI CHERIYAN S4 MBA, MACFAST
Definition of Performance Management According to Armstrong and Baron (1998), Performance Management is both a strategic and an integrated approach to delivering successful results in organizations by improving the performance and developing the capabilities of teams and individuals.The term performance management gained itspopularity in early 1980’s when total qualitymanagement programs received utmost importancefor achievement of superior standards and qualityperformance
Evolution of Performance ManagementFirst Phase: The origin of performance management can betraced in the early 1960’s when the performance appraisalsystems were in practice. . During this period, AnnualConfidential Reports (ACR’s) was also known as Employeeservice Records were maintained for controlling the behaviors ofthe employees and these reports provided substantial informationon the performance of the employees.Second Phase: This phase continued from late 1960’s till early1970’s, and the key hallmark of this phase was that whateveradverse remarks were incorporated in the performance reportswere communicated to the employees so that they could takecorrective actions for overcoming such deficiencies
Evolution of Performance ManagementThird Phase: In this phase the term ACR was replaced byperformance appraisal. One of the key changes that were introducedin this stage was that the employees were permitted to describe theiraccomplishments in the confidential performance reports, severalnew components were considered by many organizations whichcould measure the productivity and performance of an employee inquantifiable terms such as targets achieved, etc.Fourth Phase: This phase started in mid 1970’s and its origin was inIndia as great business tycoons like Larsen & Toubro, followed byState Bank of India .
The system focused on performance planning, review anddevelopment of an employee by following a methodical approach.In the entire process, the appraise (employee) and the reportingofficer mutually decided upon the key result areas in the beginningof a year and reviewed it after every six months. In the review period various issues such as factors affecting theperformance, training needs of an employee, newer targets and alsothe ratings were discussed with the appraisee in a collaborativeenvironment.This phase was a welcoming change in the area of performancemanagement and many organizations introduced a new HRdepartment for taking care of the developmental issues of theorganization.
Fifth Phase: This phase was characterized by maturity inapproach of handling people’s issues. It was more performancedriven and emphasis on development, planning andimprovement. Utmost importance was given to culture building,team appraisals and quality circles were established forassessing the improvement in the overall employee productivity The performance management system is still evolving and in the near future one may expect a far more objective and a transparent system.
NATURE OF PERSONNEL MANAGEMENT•Personnel management includes the function of employment,development and compensation- These functions are performedprimarily by the personnel management in consultation with otherdepartments.•Personnel management is an extension to general management.It is concerned with promoting and stimulating competent workforce to make their fullest contribution to the concern.•Personnel management exist to advice and assist the linemanagers in personnel matters. Therefore, personnel departmentis a staff department of an organization.
•Personnel management lays emphasize on action ratherthan making lengthy schedules, plans, work methods.•The problems and grievances of people at work can besolved more effectively through rationale personnel policies.•It is based on human orientation. It tries to help the workersto develop their potential fully to the concern.•It also motivates the employees through it’s effectiveincentive plans so that the employees provide fullestco-operation.
OBJECTIVES OF PERFORMANCE MANAGEMENTTo enable the employees towards achievement ofsuperior standards of work performance.To help the employees in identifying the knowledgeand skills required for performing the job efficiently asthis would drive their focus towards performing the righttask in the right way.Boosting the performance of the employees byencouraging employee empowerment, motivation andimplementation of an effective reward mechanism.
Promoting a two way system of communication betweenthe supervisors and the employees for providing a regularand a transparent feedback for improving employeeperformance and continuous coaching.Identifying the barriers to effective performance andresolving those barriers through constant monitoring,coaching and development interventions.Creating a basis for several administrative decisionsstrategic planning, succession planning, promotions andperformance based payment