Wednesday, January 14, 2015

What are the Characteristics of a Robust Performance Management System (PMS)

Modern PMS shall encourage creativity and innovations, not only count "doing" (efficiency), but also measure "thinking"(innovation & effectiveness) performance.

Although almost all organizations understand how crucial their people factors are for the ultimate business success. Still, many of them treat their talent as cost and resource only, their performance management is process driven and out of dated to assess, motivate and measure staff performance objectively. What are the characteristics of robust performance management system (PMS) more specifically?

PMS needs to be transparent and objective, understood by the entire organization. Performance systems are usually owned by direct boss (line management), enabled and facilitated by HR, outcomes are openly communicated to individuals, frequent follow-up on agreed actions;  focus on top performers and low performers; differentiate between future leaders and experts.  Have new hires on the radar screen.  Take “inclusiversity” (in a broad sense such as cognitive difference) into account. They are not seen in isolation, but linked to succession planning, job rotation, capability building ... So PMS -Performance management system have to be objective and impartial. The assumption has to be that most employees want to do a good job, and if they're not, it might have to do with a skills gap, management issue, or another factor outside of "trying to get over" on management.

A good PMS is something that is OUTPUT instead of PROCESS driven. Many PMS had been focused on measuring the performance of the employees on the basis of how they have followed the rules or implemented the policies and procedures giving less relevance to the services that has been delivered and how it created relevance and impact to the end-users. Moreover, a PMS that is output based will encourage creativity and innovations, given that employees recognize the empowerment to provide their own strategies towards the common goal. The talent managers shall recognize that each employee has his own uniqueness and the success of the organization truly depends not on the existing resources but on its ability to unleash the talent of each and everyone and develop their natural best for sustainable growth.

Performance Management should be sustained and monitored at constant intervals to ensure robustness. It should strongly encourage employees to self-evaluate the performance. PMS is a process to know about the concerned person him/herself where he/she stands and also his/her boss comes to know the strengths and weakness where he/she has to help or enable him/her fill the gaps one has aligned with organizational goals. Performance management should have measurable, clear, and mutually agreed upon goals based on the organization's tactical and strategic plan. It should be clear on measuring what it intends to measure and it helps if broken down in quarters and then combined at the end of the period. Compensation may be more regional or depending on external factors and the person's own motivation.

PMS -Performance management process’s main goal is motivation and retention.  There needs to be a baseline process defined across the organization to allow for consistency of the ratings...manager performing at the same level should have consistent ratings based on their experience.
#1- Goals should be clear and obtainable. Regular feedback is a must and incentives should be comparable to expectation set.
#2 - Consistency throughout organization and competitive within the market.
#3 - A performance rating should never be a surprise to the person receiving the rating. There should be regular touch points between the person and the performance rater.

PMS also promotes teamwork, rather than for micro-management. The basic fact is that Performance Management System (PMS)  is a working tool that improves performance/productivity within an organization. it should not be used to "get back" at employees, but should develop employees leading to a self driven team rather than a micromanaged one. Ensure that the system measures goal achievement, the way they were achieved (the competencies that best reflect the culture of the organization) and the core responsibilities of each employee (aligned with each department mission).
- The PMS also assists to identify strengths and weaknesses of which, the latter is dealt with through mentoring, coaching and development.
- The system must have buy-in from all participants. If either party feels there is any unfairness it will fail. It reduces the 'olden days' top down communication and the finger pointing approach; objectives are drawn, discussed and agreed upon; the difficulties encountered are identified and communicated timely between the concerned parties in order to take corrective action.
-Do not consider performance management as a once/twice a year process. It is a daily process and managers/supervisors need to be trained in how important this is.

A robust performance management system needs to be designed with end users in mind, more output driven, not process-driven; be positive in nature, the goal is not for micromanaging, but for motivation and retention, to encourage critical thinking and innovation, and to well align employees’ strength with organization’s goal, to create synergy and optimize overall organizational maturity.  


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