Significance of PM. Performance Management VS Performance Appraisal, Characteristics of PM, Process of PM, Performance Planning, Performance Assessment

1. Prepared by
V. Mouneswari
Assistant Professor
AITS(Autonomous),RJP
Performance management

2. Meaning of Performance
Management
 The action or process of carrying out or
accomplishing an action, task, or function can be
termed as performance.
 Performance management includes the processes
used to manage corporate performance, the
methodologies that drive some of the processes and
the metrics used to measure performance against
strategic and operational performance goals.

3. Definitions
 PM is a Continuous Process of Identifying performance of individuals
and teams Measuring performance of individuals and teams
Developing performance of individuals and teams and Aligning
performance with the strategic goals of the organization
 “It is a continuous process of identifying, measuring and developing
the performance of individuals and teams and aligning performance
with the strategic goals of the organization”.
 PM contains two major components:
1. It’s a continuous process
2. Alignment with strategic goals

4. Continued..
 Performance management (PM) includes activities that
ensure that goals are consistently being met in an
effective and efficient manner.
 Performance management focuses on the performance
of an organization, a department, employee, or even
the processes to build a product or service or any other
areas in an organization.

5. Objectives of PM
 To emphasise on career planning and future growth
opportunities for employees.
 It is ensure to raise the efficiency and productivity of employees.
 To encourage belongingness, team spirit and devotions among employees
with the job.
 To provide feedback about HR planning and potentialities to implement
the planning facts.
 To identify systematically the need and requirements of some learning and
training aspects.

6. Continued..
 To promote better and high work culture in the organization.
 To focus more on systems approach to perform appraisals rather than to
make any formalities.
 To foster a positive relationship between managers and employees through
a two way communication process.
 To appreciate, recognize and to give reward and compensate employees for
achievement of performance objectives successfully in a more objective,
transparent and justified way.

7. Purpose of PM
 It serves the strategic purpose of the org.
 Administrative purpose
 Provide information for reward system
 Facilitates HR decisions
 Enabling employees to learn about their performance as
against org expectations
 It serves as a developmental purpose
 Serves org maintenance purpose
 Support HR decision to meet legal requirements
 Documentation Purpose

8. Significance of PM
1. It Provides a Look into the Future
By consistently monitoring and managing workplace performance,
leaders can see potential future problems. Like with any type of issue,
early detection is key. The earlier problems are confronted the less effect
that they will likely have.
2. Helps Create Development and Training Strategies
with performance management, problems would probably be detected.
The organization could then create training programs to change the
issue into an opportunity for improvement.

9. continued…
3. Provides Clarity in the Organization
Through performance management, the company can make all of this
very clear. A lack of understanding often leads to a lack of productivity.
Therefore, by providing clarity for employees, the result will often be
increased productivity and confidence.
4. Provides the Opportunity for Exchanging Feedback
Effective performance management provides an avenue through which
both the employer and the employee exchange feedback. In addition to
gaining insight, employees often feel much more valued when they can
voice their thoughts.

10. Continued…
5. Increases Employee Retention
Performance management also encourages organizations to reward
and recognize their employees. In addition to the clarity, the ability to
share feedback, and the additional training when needed, rewards
and recognition can play an important role in employee retention.
6. Boosts Employee Engagement
Performance management has the capability of engaging employees
fully and making them feel invested in the company. This leads to job
satisfaction and employee loyalty, all of which increases productivity.

11. Performance Management VS
Performance Appraisal
 Both are different concepts.
 PM is a broader term & includes appraisal as a part of
the performance system.
 Performance appraisal is the systematic description of
an employee’s strengths and weakness.
 Thus, performance appraisal is an important
component of performance management.

12. Performance Management VS
Performance Appraisal
Performance
Management
 Strategic business
considerations
 Ongoing feedback So
employee can improve
performance
 Driven by line manager
Performance appraisal
 Assesses employee
 Strengths & Weaknesses
 Once a year
 Lacks ongoing feedback
 Driven by HR

13. Characteristics of PM
 Strategic congruence
 Thoroughness
 Practicality
 Meaningfulness
 Specificity
 Reliability
 Validity
 Acceptability

14. Continued..
 Inclusiveness
 Openness
 Correctability
 Standardization
 Ethicality
 Identification of effective & ineffective performance

15. Process of PM
Prerequisites
Performance Planning
Performance execution
Performance Assessment
Performance Review
Performance Renewal and Recontracting

16. Prerequisites
 Two important prerequisites before PM system are:
1. Knowledge of the organisation’s mission & strategic
goals
2. Knowledge of the job in question (this is done through
job analysis)

17. Performance Planning
 Employees should have a through knowledge of the PM System.
1. Results
 Planning discussion includes :
2. Behaviours
3. Developmental issues

18. Performance execution
1. Commitment to goal achievement
2. Ongoing performance feedback & coaching
3. Communication
4. Collecting & sharing performance data
 At the execution stage, following factors must be considered:
5. Preparing for performance reviews

19. Performance Assessment
 It is important for employee as well as the managers to take ownership
of assessment process.
 It helps the org to use the information obtained in a productive manner
for the future requirements.
 Inclusion of self appraisal is also beneficial in all manner.

20. Performance Review
 This meeting is called Appraisal Meeting.
 Review meeting helps employee and manager to design developmental
plans.
 Review stage involves meeting between employees & the manager.

21. Performance Renewal and
Recontracting
 Its identical to planning stage.
 Manager uses the insights & information gained from
other phases to reset performance goals for employees

22. Performance Management Vs HRM
 In PM, the pay is based on job evaluation. Unlike HRM, where the
basis of pay is performance evaluation.
 Personnel management primarily focuses on ordinary activities, such as
employee hiring, remunerating, training, and harmony.

23. Benefits to employees
 Identifies and defines expectations.
 Aligns each employee’s daily tasks with key business objectives.
 Determines goals and where to focus skill development.
 Includes both accomplishments and areas needing improvement.
 Routinely reviews results.
 Managers spend less time micro-managing employees.
 Employees enjoy greater autonomy.
 Misunderstandings are reduced and confusion is lessened.

24. Continued..
 Clarifies expectations of the employees
 self assessment opportunities clarifies the job
accountabilities and contributes to improved
performance
 clearly defines career paths and promotes job
satisfaction.

25. Benefits to Managers
 Saves time and reduces conflicts
 ensures efficiency
 consistency in performance.

26. Benefits to organization
 Set goals
 Motivate Employees
 Staff Development
 Create sense of fairness
 Handle firing risks
 Improved organizational performance
 employee retention and loyalty
 improved productivity
 overcoming the barriers to communication
 clear accountabilities
 cost advantages.

27. Thank You..