The Benefits of Performance Management


Performance management includes activities to ensure that goals are consistently being met in an effective and efficient manner.

The overall goal of performance management is to ensure that the organisation and all of its subsystems (processes, departments, teams, employees, etc.) are working together in an optimum fashion to achieve the results desired by the organisation.


Performance management can focus on the performance of an organisation, a department, employee, or even the processes to build a product or service, as well as many other areas.


The key benefits of performance management include:


  1. A focus on results, rather than behaviours and activities. A common misconception among supervisors is that behaviours and activities are the same as results. So, an employee may appear extremely busy, but not be contributing at all toward the goals of the organisation.
  2. Aligns organisational activities and processes to the goals of the organisation. Performance management identifies organisational goals, results needed to achieve those goals, measures of effectiveness or efficiency (outcomes) toward the goals, and means (drivers) to achieve the goals. This chain of measurements is examined to ensure alignment with overall results of the organisation.
  3. Cultivates a system-wide, long-term view of the organisation. An effective performance improvement process must follow a systems-based approach while looking at outcomes and drivers, otherwise, the effort produces a flawed picture. For example, laying off people will likely produce short-term profits, however, the organisation may eventually experience reduced productivity, resulting in long-term profit loss.
  4. Produces meaningful measurements. These measurements have a wide variety of useful applications such as benchmarking, or setting standards for comparison with best practices in other organisations. They provide consistent basis for comparison during internal change efforts. They indicate results during improvement efforts, such as employee training, management development, quality programs, etc. They help ensure equitable and fair treatment to employees based on performance.
  5. Cultivates a systems perspective. This means there is a focus on the relationships and exchanges between subsystems, e.g., departments, processes, teams and employees. Accordingly, personnel focus on patterns and themes in the organisation, rather than specific events.
  6. 6. Depersonalises issues. Supervisor's focus on behaviours and results, rather than personalities.
  7. Performance reviews are focused on contributions to the organisational goals. This means the focus at reviews is on questions like "What organisational goal were contributed to and how?"
  8. 8. Helps you think about what results you really want. You are forced to decide on measurable results to measure the vision, and so validates expectations.


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