What is Performance Management?

23 December 2021 | 4 Minute
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What is Performance Management?

The process of continual communication and feedback between a manager and an employee toward the attainment of organizational objectives is defined as performance management.

A systematic performance-management program ensures that managers and employees are on the same page when it comes to objectives, goals, and career advancement, as well as how an individual's work fits into the company's overarching vision. Individuals are viewed in the context of the larger workplace system when it comes to performance management. Performance management is one of the tools used to always achieve a better result from all company components such as the company's resources, financial structure, and employees.


What is the goal of performance management?

The purpose of performance management is to create an atmosphere in which people can perform to their full potential and deliver the highest-quality work in the most efficient and effective way possible. The following are the main goals of the performance management system:

Feedback: The goal of a performance management system is to provide a method for providing systematic feedback. It establishes a path for employees to become aware of their contribution to the organization's overall performance. It also informs the employee of the need to enhance their performance in order to achieve the established criteria.

Development: It addresses the organization's development challenges. It recognizes the need for skill and knowledge growth in the organization and enables the relevant training programs.

Documentation: It provides a database for the organization in which all employee information is collected. This database stores information about the employee's performance level, abilities, knowledge, expertise, and regular awards.

Organizational Problems Diagnosis: A performance management system is used to track the ups and downs in an employee's performance. This document aids in the diagnosis of organizational issues. It gives an understanding of where the work is going wrong and what modifications are needed to improve the organization's performance.

Decisions on Employment: The management makes numerous key decisions based on the performance management records. Training and development programs, promotions, raises or decreases in salary, recruiting decisions, and so on are all part of the decision.


How do you improve the performance management system?

You and your team conducted research to locate the best performance management procedure, prepared all internal documents, and implemented your new people management system. Why aren't you seeing the outcomes you expected? Managers are meeting with staff more regularly, praise is flowing, and quarterly targets are in place – so what's the problem?

You just haven't hammered down all of the details yet.

The good news is that you're moving on the correct path. Your drive for a better performance management approach is changing your workplace for the better, and it's laid a solid foundation for you to build on.

The good news is you're taking huge strides in the right direction. Your push for a better performance management process is positively reshaping your workplace, and it's set a great foundation for you to iterate on.


To improve the performance management process, ask the following questions:

What are the expectations of your employees when it comes to performance management?

Your employees can benefit or be harmed by a performance management program. However, before you can make any modifications to your current procedures and tools, you must first figure out why they aren't working.

Is it possible for you to provide ongoing performance management?

Employers want their workers to be satisfied. However, happiness isn't always what people expect from their bosses. Employees, on the other hand, want to be motivated and understand why their work is important. Employee motivation should be the emphasis of a performance management experience that generates value.

Do managers have the resources they need to manage the performance appraisal process?

Managers are crucial to your organization's performance management program's success. They have a significant impact on motivating, engaging, and growing employees. This necessitates ensuring that managers are taught to give and receive useful feedback, as well as coached on the fundamentals of a good feedback system.


Here are 10 performance management best practices that you should keep in mind and take to heart!


  1. Clearly define your objectives.
  2. Begin by putting together a performance plan.
  3. Establish a continuous procedure.
  4. Increase productivity by effectively managing goals.
  5. Collect data from a variety of sources.
  6. Document, document, document.
  7. Train and prepare your management.
  8. Make the performance evaluation perfect.
  9. Establish a link between performance and incentives and recognition.
  10. Encourage complete participation and achievement.


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