What Is Performance Management?


Quick Answer

Performance management is a continuous and systematic process that allows a company or an agency to ensure efficiency in reaching a set of business objectives. The process involves employees and entails planning, monitoring, development, rating and rewarding, all directed toward the goal of improving overall organizational effectiveness.

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Full Answer

To be effective, the process of performance management first needs to set expectations and make a plan by means of which those expectations can be met. Furthermore, the process needs to develop a capacity to perform efficiently based on the observations made during the monitoring stage. Rewards for good performance that is identified through a periodic rating procedure set a good example for others in addition to providing an incentive to bolster work efficiency.

Managers must clearly define the type of business their company is trying to achieve and delineate the roles of various employees in the process. Once the required skills, competencies and standards of performance are established, employees can improve their work performance and efficiently contribute to the development and completion of company objectives.

Managers who are in charge of performance management must typically establish a line of dialogue with employees or team members, keeping apprised of their progress and advising them with regards to any problems they might have. This way, managers can track overall progress, identify necessary modifications, and execute those modifications to reach the set goals promptly.

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