Good Performance Management Systems - Research Paper Example

Running Head: Good Performance Management Systems Student’s Name: Instructors’ Name: Course Code: Date of Submission: Research questions The aim of this research paper is to answer the following questions as related to performance management systems. What is a performance management system? What are good performance management models? The characteristics of good performance management systems? The research objectives At the end of this research, the following objectives must be realized: Describing in broader terms the concept of performance management systems Discuss different types of performance management models as used in organizations Discuss the various characteristics of various performance management models 1.0 Introduction In several decades, the concept of performance management has not been taken more serious the way it ought to have been by the organizations and their leadership. For long, the management class has failed to appreciate the role of performance management systems for their businesses. However, with the current world economic crisis many of the organizations have now been subjected into serious management problems more so the ones that are related to organizational performance. Change in technology and high cost of doing business allover the world contributes to a larger part of the problems management teams are facing currently as stated by Zimmermann & Sparrow, (2008). These problems have greatly influenced the labour market as well as the target audience and market. The ultimate goal for the management is to achieve high level of performance by utilizing the available resources at a more effective cost. Because of these reasons, the management role now is to come up with the most appropriate and effective performance management systems that will ensure that the businesses are breaking-even apart from ensuring that they are able to secure a comfortable place both in the labour market and the customer base. It is because of this reason that this research seeks to explore the whole concept of good performance management systems, their characteristics and various management performance systems as applied in the current management functions by answering the research questions and objectives stated above (Daniels, 2004). 1.1 Performance management system Performance management system is broader term that describes how technology uses it is imbedded package of applications and methods to bring about desired results in terms of behavior and performance. These two are the most critical elements of performance management according to Arshad & Sparrow (2010). Performance management systems include a number of activities which ensures that the process of working towards achieving performance goals is consistent, effective and efficient. The overall agenda of a performance management system is aimed at realizing high organizational, departmental, employee, and product and service performance. Performance management system is concept that is widely applied in institutions, community groupings, health settings, political settings as well as in the government agencies mainly to help in bringing desired organizational performance results. Performance management is a strategy used by the management to support the organization’s performance by improving workforce performance by developing individual capabilities. Performance measurement is also vital in ensuring that organizational standards are achieved and are consistent with ISO9000 requirements (Gary, 2009). 1.2 Characteristics of good performance management system As discussed earlier, performance management system is aimed at promoting effectiveness in realizing both strategic and operational objectives. However, this is only possible if the system is able to apply correlated business performance practices and software to bring about intended organizational results. As illustrated by Richter, Dawson & West (2011), use of integrated software for workers performance management systems as compared to a mere record system that makes use of the spreadsheet, can help in increasing the organizational returns through direct and indirect sales and improved efficiency which assists in unlocking the capabilities among the individuals. This is possible because time spent by an individual in performing a certain function is greatly reduced by the system. Therefore the major characteristic of a good performance management system is the ability to deliver the projected results and even surpass as argued by Al & Regina (2006). The following are the characteristics of a good performance management system: 1.2.1 Direct financial benefits In developing a performance management system, the business must first asses the likely benefits that it is to gain in terms of results and overall performance of employees. In most cases the main target for any organization is to realize financial benefits. Some of the financial benefits that the organization is likely to gain include: growth in sales, reduced operational cost, reduced project overruns, alignment of organizational goals with those of the management and achieving both operational and strategic change. These are the financial benefits the organization must realize from a performance management system in order to conclude whether the system is good or not as argued by Hesketh & Fleetwood (2006). 1.2.2 Motivating the workforce One of the characteristics of a good system is that it must have an element of inspiring the employees. The workers must feel satisfied with the system and they must be convinced beyond doubt that the system is considerate, fair and consistent with both their workplace life and personal life as argued by Robinson, M. et el (2007). A good performance management system should be the one that should ensure that employee incentives plans are well utilized in order to achieve the stated goals. The system is also expected to brief the employees and make them aware of their individual roles with regard to organizational performance apart from promoting transparency among the workforce as well as gaining employee confidence in relation bonus payment terms and processes according to Van Knippenberg et el (2011). 1.2.3 Advanced management control Apart from ensuring that financial benefits are realized and employee motivation is achieved, it is important to note that a good performance management system should have in it an element of flexibility that will allow the management to make any necessary changes that it may deem right to meet the prevailing demands. Informational interrelationship must also exist between the employer and the employees so as to make it easier to deal with any issues related to performance. In other words a good system must provide a forum where people are privy to the information for easy management. The system must follow the rule of law, item planning and proper documentation (Mawhinney & Redmon, 2001). 2.0 Research methodology This section spells out the procedures and the methods that the researcher employed in achieving the objectives of the project so highlighted in the abstract of this paper. It defines location of the study, research procedures and analysis plan that were addressed in the course of the study consideration when carrying out this particular research. The research was supposed to start with the clear understanding of the research objectives. Success of the project was a factor of accessing satisfying information in line with the objectives in the determination of the characteristics of a good performance management system. The objective of the research just as a recap is to identify the characteristics of a good performance management system in an organization and the different types of performance management systems. It is important to note here that this research was mainly based on the interviews even though other research methodologies were briefly discussed (Geary, 1995). Secondary research on the other hand is the collection of existing data, that is, in contrast to primary research where raw data is searched about a phenomenon. For example: research on experiments or specific subjects. The merit of secondary research is that it’s not time consuming however a disadvantage is that the information retrieved may not be relevant (Austin, 2009). Another aspect that is of great significance in this research was the research strategy. It’s the research strategy that indicated which methods a researcher adapted to answer the research objectives or questions on good performance management systems (Zaffron, 2009). 3.0 Findings From the research, a number of discoveries were made which include the identification of different performance management systems and their role in determining the performance of a business as illustrated by Carroll et el (2007). The following are the different performance management systems that are commonly used in organizations: Balanced score-sheet: This is the sheet that is used to describe the trend of performance of four major areas of focus within an organization which include: customer performance, internal operational processes, and learning as well the growth of business finances. This system is such important in that it helps the business to measure its progress towards realizing the business’ strategic goals (Zaffron, 2009). Benchmarking: Use of benchmarking as a performance management system, it is important because it helps the organization to realign its goals against those of the industry in order to come up with standards that are acceptable to all employees. Apart from managing performance, benchmarking also helps in realizing the overall processes quality within an organization (Austin, 2009). Outcome-based evaluation: This system is important more so in the non-profit oriented organization. It is used to asses and manages the performance of the organizational products and services on the target persons. Under this system, the preferred outcomes are included in the process and are often measured by associate indicators to ascertain their level of performance (Aubrey, 2006). 4.0 Conclusion/Evaluation Performance management systems help to monitor the performance of employees as well as that of the organization. For example, they help to set out goals, monitor employees’ performance against the organizational goals, rewarding employees on their performance, linking with the employees as well as training and promoting the employees. Apart from applying to employees’ performance, performance management systems also apply to organizations as well. The process of managing organizational performance entails a number of activities which include setting of organizational goals in a more effective and efficient way (Gary, 2009). 5.0 Recommendations In order to realize the benefits of good performance management systems, a number of things have to be considered which include: The process of designing and implementing a good performance management systems must be inclusive of all key stakeholders who in this case include the employees, the employer and the industry in which the business operates. Good performance management systems must have clear objectives which must be realized at the end of given period. Performance management systems should not be made at the expense of the employees. Their rights and confidentiality must be respected in order to ensure that they are also benefiting from the system. Many of the recurring activities within an organization, is what in most cases the managers do for the organization and therefore it is important for the management to think more on organizational performance rather just change (Zaffron, 2009). References Al, B & Regina, B 2006, Factors affecting the outcomes of performance management systems, Journal of Information Technology Management, 17(2), 24-34. Arshad, R & Sparrow, P.R 2010, Downsizing and survivor reactions in Malaysia: modelling antecedents and outcomes of psychological contract violation.  International Journal of HRM. 21(11): 1791-1813. Aubrey, C 2006, Performance Management: Changing Behavior That Drives Organizational Effectiveness, Pittsburgh, University of Pittsburgh Press. Austin, J 2009, Organizational performance Management Network, London, Springers. Carroll, C. et el 2007, A conceptual framework for implementation fidelity. Implementation Science, 9(3): 34-78. Dale, B 1998. Performance-based Instruction: Linking Training to Business Results. Pittsburgh, University of Pittsburgh Press Daniels, A 2004, Performance Management: Changing Behavior that Drives Organizational Effectiveness. Pittsburgh, University of Pittsburgh Press. Gary, C 2009, Performance Management - Integrating Strategy Execution, Methodologies, Risk, and Analytics. New York, Wiley & Sons, Inc. Geary, A 1995, Improving Performance: How to Manage the White Space in the Organization Chart. Washington DC, Brookings Institution Hesketh, A.J & Fleetwood, S 2006, HRM-Performance Research: Under-theorised and Lacking Explanatory Power, International Journal of Human Resources Management, 17(12): 1979-1995 Mawhinney, C & Redmon, K 2001, Organizational Performance, London, Routledge. Richter, A. W., Dawson, J. F., & West, M.A 2011, The effectiveness of organizational teams: A meta-analysis. International Journal of Human Resource Management, 22(13), 2749- 2479. Robinson, M. et el 2007, Forecasting future competency requirements: a three phase methodology, Personnel Review, 36 (1): 65-90 Van Knippenberg, D. et el 2011, Diversity faultlines, shared objectives, and top management team performance, Human Relations, 64(3), 307-331. Zaffron, L 2009, Performance Management: The Three Laws of Performance: Rewriting the Future of Your Organization and Your Life. Aldershot, Ashgate. Zimmermann, A & Sparrow, P.R 2008, Mutual adjustment processes in international teams: lessons for the study of expatriation.  International Studies of Management and Organization. 37 (3): 65-88. Appendices Zimmermann, A & Sparrow, P.R 2008, Mutual adjustment processes in international teams: lessons for the study of expatriation.  International Studies of Management and Organization. 37 (3) Carroll, C., Patterson, M., Wood, S., Booth, A., Rick, J & Balain, S 2007, A conceptual framework for implementation fidelity. Implementation Science. Arshad, R & Sparrow, P.R 2010, Downsizing and survivor reactions in Malaysia: modelling antecedents and outcomes of psychological contract violation.  International Journal of HRM. 21 (11): 1791-1813. Van Knippenberg, D. , Dawson, J.F.,  West, M.A & Homans, A 2011, Diversity faultlines, shared objectives, and top management team performance, Human Relations, 64(3). Richter, A. W., Dawson, J. F., & West, M.A 2011, The effectiveness of organizational teams: A meta-analysis. International Journal of Human Resource Management, 22(13), 2749-2479. Al, B & Regina, B 2006, Factors affecting the outcomes of performance management systems, Journal of Information Technology Management, 17(2), 24-34. Read More