A well-designed performance framework is an important tool for the business management to take the holistic approach of managing performance and improving business achievement.
Performance Management is supposed to enable business achievement. A suitable Performance Management framework delivers the results the organization needs in a demonstrable or measurable way. A well-designed performance framework helps the management focus on measuring things really matter and facilitate answers to some key questions of performance management such as. (1) What are you trying to achieve? (2) How are you going to measure it? To put it another way: What are your performance goals? How will you know when you've achieved them?
Integrates both numerical and qualitative performance measurement: A key feature of the performance measurement framework offered is that it integrates both numerical and qualitative information that relates to improve business performance. Strategy Management and Performance Management often go hand-in-hand. The strategy planning is the clearer direction of organizational competency development and a clearer basis for evaluating business performance. Instead of simply saying that an assigned work was completed successfully, but giving time for evaluating how the work was achieved in terms of planning, use of available resources, clarity of direction, as well as how teamwork was achieved to create the business synergy. In many companies, a pervasive obsession for purely numerical success indicators sweeps aside much of the softer, more qualitative information that is crucial in understanding the health and well-being of the firm's performance. There are indeed qualitative objectives where the basis for rating performance is the set of criteria that address the question: “What does it mean to achieve the objective?” An effective performance management framework provides a anchor to define and deal with the Key Performance Indicator. It has a functional specification detailing its meaning, intent, relationships to other measures, calculation, data requirements, reporting requirements and ownership. “Key” means to seek out the correct indicators for a given need “WHY.” The “WHY” is critical as the performance indicators will differ based on the reason or underlying purpose for measuring performance. It needs to be accompanied by an agreed standard, defining tolerances (upper and lower) for variation.
An effective performance management framework ensures that the people component is considered at all facets of performance measurement: Since implementation of the strategic plan will be done by people. Top management has to ensure that the people component is considered and mapping the employee’s performance to all facets of business performance. At the strategic level, performance management should connect multidisciplinary management dots to tell the full story with the business context and people-centricity. Measuring performance and determining learning needs are two of the key drivers for implementing the organizational competency frameworks. Thus, performance framework and talent competency framework are intersected with people as the focal point. It is important to build a global learning workforce, engaged in a broad range of responsibilities, working on an integrated model to link workforce capacity, hiring, workforce deployment (project assignments), performance, and learning into a holistic people management solution. A suitable Performance Management Framework for the organization (not one size fits all) combined with a culture and an attitude that truly values the delivery of performance feedback whenever and wherever it is needed will win out.
A well-designed performance framework is an important tool for the business management to take the holistic approach of managing performance and improving business achievement. It helps to set metrics, fix plans, understand results, and make decisions to ensure the strategic goals are on the right track to get implemented and communicated effectively at the different levels of the business and manage business performance as an iterative management continuum.
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