PERFORMANCE

MANAGEMENT
A Process that consolidates
GOAL SETTING
PERFORMANCE APPRAISAL
and DEVELOPMENT
into a Single, Common System.
 Comparing Performance Management
with Performance Appraisal
• PERFORMANCE APPRAISAL:
It means EVALUATING an employee’s Current
or Past Performance
relative to
his or her Performance Standards.
• PERFORMANCE MANAGEMENT:
A process which consolidates
1. Goal Setting
2. Performance Appraisal
3. Development
in to a single common system, the AIM
of
which is to ensure that the employee’s
Performance is SUPPORTING the
company’s STRATEGIC AIMS.
 PERFORMANCE
MANAGEMENT
• Performance Management includes the
practices through which the manager
(a) DEFINES the Employee’s
GOALS and WORK
(b) DEVELOPS the Employee’
CAPABILITIES
(C) EVALUATE and REWARDS the
Employee’s
EFFORT
all within the framework of
How the employee’s performance should
be Contributing to Achieving the
Company’s GOALS.
PERFORMANCE
MANAGEMENT
DEFINING THE EMPLOYEE’S GOALS
AND WORK EFFORTS
Guidelines for Effective Goal Setting:
• Assign Specific Goals
• Assign Measurable Goals
• Assign Challenging but Doable
Goals
• Encourage Participation
 PERFORMANCE MANAGEMENT:
Appraising Performance

REASONS TO APPRAISE
SUBORDINATE’S PERFORMANCE:
• 1. It does little good to Translate the
Employer’s Strategic Goals into
Employees’ Goals, If you Don’t
periodically Review Your employees’
Performance

• 2. Develop a plan for Correcting any

Deficiencies
• 3. Provide the Opportunity to Employee to
Review Career Plan in the light of his/her
Exhibited Strengths and Weaknesses
4. It almost always Affect the employer’s
Salary and Promotional Decisions.
PERFORMANCE
MANAGEMENT
• It is an approach to creating a
-Shared Vision of the
Purpose and Aims of the
Organization,
-Helping each employee Understand and
Recognize their Part in Contributing to
them
(Purpose and Aims of the Organization),
and in so doing,
-Manage and Enhance the Performance of
both Individuals and the Organization.
PERFORMANCE
MANAGEMENT: SCOPE
• PM Concerns everyone in the
business- not just the managers.
Responsibility is shared bt.
Managers and the Team members.
Managers should regard the people
who report to them as CUSTOMERS
for the managerial contribution and
services they can provide.
General Considerations Affecting
the Management and
Improvement of Performance
• Another important Feature of an
EFFECTIVE Organization is the
Pursuit of High Performance by
DEVELOPING COMPETENCIES.
Competency is the Key that Unlock
the door to individuals in Realizing
their Maximum Potential and
Providing Maximum Growth
Opportunities for Personnel.
PERFORMANCE

• Record of Outcomes Achieved

• Record of Persons Accomplishments
• The Outcome of work because they
provide the strongest Linkage to the
Strategic Goals of the Organization
Customer Satisfaction
Economic Contributions
PERFORMANCE

• Performance is Behavior and

should be Distinguished from the
OUTCOMES because they can be
Contaminated by System Factors.
• Comprehensive View of
Performance;
Performance means both
Behavior and Results.
PERFORMANCE

MIXED MODEL of PM
• It is concluded that when managing
the Performance of Teams and
Individuals,
both INPUTS (BEHAVIOR)
and OUTPUTS( RESULTS)
should be Considered.
• It is about How Things are Done and
What is Done?
FACTORS AFFECTING
PERFORMANCE
• PERSONAL FACTORS

• LEADERSHIP FACTORS

• TEAM FACTORS

• SYSTEMS FACTORS

• CONTEXTUAL( SITUATIONAL)
FACTORS
PERFORMANCE
MANAGEMENT
• A Process of Aligning or
Integrating individual Objectives
to Achieve Organizational
Effectiveness
• Development is the Prime Purpose
of PM
• It needs Encouraging, Developing,
Supporting and Sustaining.
PERFORMANCE
MANAGEMENT
Foundation upon which PM is built:
• People Know and Understand What is
Expected of them.
• Have taken part in Forming those
Expectations.
• The Capacity to meet Expectations
depends on;
1. level of Capabilities of People
2. Level of Support they are given by
Management
3. Process, Systems, Resources made
Available to them by the Organization
PERFORMANCE
MANAGEMENT
• Considering the above the basic
Aims of PM is:
-To Share Understanding about
What is to be Achieved

-To Develop the Capacity of

people and the Organization to
Achieve it

-To Provide Support and

Guidance
 Performance
Management SEQUENCE
1. Corporate Mission and Strategic
Goals
2. Business and Departmental
Plans and Goals
3. Performance and Development
Agreement
4. Performance and Development
Plan
 Performance
Management SEQUENCE
5. Action- Work and Development
6. Continuous Monitoring and
Feedback
7. Formal Review, Feedback, and
Joint
Assessment
8. Rating
9. Financial Reward
 Performance
Management SEQUENCE
• 1.Corporate Mission and Strategic
Goals:
Starting point of PM Process.
All the Activities in the sequence
must be aligned to them and
contribute to their Achievement.
• 2. Business and Departmental Plans
and
Goals:
 Performance
Management SEQUENCE
3. Performance and Development
Agreement:
• Agreement on Objectives and
Accountabilities reached by individuals with
their Managers.
• Performance Agreement defines:
the Work to be Done,
the Results to be Attained
the Performance Standards to be Achieved
the Competence Levels Required
• Formal Review Meeting.
• Pre-Review Meeting Questionnaire
(Agenda for the Review).
 Performance
Management SEQUENCE
The Agreement should be based on
an OPEN, TWO WAY, and
UNAMBIGIOUS discussion.
This covers following Areas:
• What the person is DOING NOW.
• What the person might have to Do in
FUTURE due to Changing
Environment
• How the WORK should be done.
(Competence or Process
Requirements)
 Performance
Management SEQUENCE
The Agreement should be based on
an OPEN, TWO WAY, and
UNAMBIGIOUS discussion.
This covers following Areas:
• What the person is DOING NOW.
• What the person might have to Do in
FUTURE due to Changing
Environment
• How the WORK should be done.
(Competence or Process
Requirements)
 Performance
Management SEQUENCE
• What the Expected Performance
Requirements (Outputs) and
Standards are.
• What KSAs are Required to do the
work ( Input Requirements)
• Core Values the individual would be
Expected to Uphold such as;
Quality, Teamwork, Care for
Environmental Issues, Responsibility
to the Community, Customer Service.
 Performance
Management SEQUENCE
-the Discussion will Define the Expectations
on how the person’s Behavior should Support
these Values.
-Values may be expressed in a List of
Competencies
• What Support the person Requires from
the Manager,
Co-Workers,
Resources,
Information.
• Agreement should be concluded on Process
Goals( How the work is done)
as well as Output Goals (What has to be Achieved)
 Performance
Management SEQUENCE
• 4. PERFORMANCE and
DEVELOPMENT PLAN:
Joint Exploration of what
individuals Need to Do and Know to
Improve their Performance and
Develop their Skills and
Competencies and
How their Managers can Provide the
Support and Guidance they need.
 Performance
Management SEQUENCE
• Agreement is also made on the basis
upon which Performance will be
MEASURED.
• These Measures should be Clearly
Identified and fully Agreed because
these will be used to MONITOR
Progress and demonstrate
Achievements.
• On the part of Individual it includes
Preparation and Agreement of
Personal Development Plan.
 Performance
Management SEQUENCE
• 5. Action- Work and
Development:
It focuses on What has to be
Done?
How it is Done?
What is Achieved?
Developing People-
Helping them to Learn,
Providing them with the
support they need to do well
 Performance
Management SEQUENCE
• 6. Continuous Monitoring and
Feedback:
It is not a once in a given period
Task for Employees and Managers
but it is a Continuous process of
Direction-setting,
Monitoring and
Measuring Performance,
Providing Feedback and
Taking Action Accordingly.
 Performance
Management SEQUENCE
• 7. Formal Review, Feedback, and
Joint Assessment:
-Summarize and Draw Conclusions
from what has been happening since
the last review
-to give opportunity to individuals to
comment on the Leadership, Support
and Guidance they get from the
Managers
-Managers are there to Coach, not to
Criticize.
 Performance
Management SEQUENCE
• 7. OVERALL PERFORMANCE
RATING:
Levels of Rating;
- ODD Numbers- 3, 5, or 7.
- EVEN Numbers- 4, 6, or 8.
- Negative Descriptions of Levels in a
Rating Scale should be Avoided.
Instead it must serve as Positive
Reinforcement at each level.
Examples; ……
 Performance
Management SEQUENCE
Levels of Rating;

Examples;
• Highly Effective
• Effective
• Developing
• Improvable
 Performance
Management SEQUENCE
ACHIEVING CONSITENCY IN
RATING

• FORCED DISTRIBUTION
• RANKING
• TRAINING
• PEER REVIEW
• MONITORING
 Performance
Management SEQUENCE
PERFORMANCE-RELATED PAY

• Organization are concentrating

more on the Development than
the Reward Aspect of
Performance Management.
 Performance
Management SEQUENCE
DOCUMENTATION
• Pre-meeting Documentation;
Review of Job Contents
Individual’s Achievements
Development Needs and Potential
Possible Objectives for the next period
What Objectives individuals would like
to
set for themselves

• Review Meeting Documentation;

Performance Appraisal
Tools
GRAPHIC RATING SCALE METHOD

• Simplest- Most Popular

• Lists Traits e.g., Reliability and
• Range of Performance Values e.g.,
Outstanding,…..Unsatisfactory
for Each Trait

• Supervisor Rates each subordinate on the

basis of these Traits and Perf. Values
Performance Appraisal
Tools: GRS
WHAT TO MEASURE?

• Job’s Actual Duties

- Admin. Sec.(Fig. 9.4)
--Five main sets of duties
e.g., “Maintaining Records”
---Here we Assess How Well she
did in exercising her job duties
Performance Appraisal
Tools: GRS
• Competency-based
Appraisal

-Competencies which the

employer Values for this Job.
-the extent to which the
Employee is meeting her
Standards
Performance Appraisal
Tools:
• Tools that measure Several Things:

1. Competencies to be developed
by the employee e.g.,
Identifies and Analyze Problems
Maintains Harmonious and
Effective Work Relationship
Performance Appraisal
Tools:
• Tools that measure Several
Things:

2. Objectives:
Employee and Supervisor Fill
in the Objectives at the Start
of the year
Performance Appraisal Tools:
Alternation Ranking
Method
• Ranking employees from Best to
Worst on particular TRAIT,
Choosing Highest then Lowest
until All are Ranked.
Here it easier to Distinguish
between
the Worst and Best Employees
Performance Appraisal Tools:
Paired Comparison Method
• For every TRAIT
(Quality or Quantity of Work…)
Every Subordinate is PAIRED and
Compared with every Other
Subordinate.

• A Chart is made of all possible pairs

of employees for each Trait (Fig. 9-7
page 321).
Performance Appraisal
Tools: Forced Distribution
Percentages for Different
Performance Categories are
Predetermined.

• This method means two things

(i) Not every one can get “A”
(ii) One’s Performance is always
rated
Relative to one’s Peers

• General Electric:
Top 20%, Middle 70%, Bottom 10%
Performance Appraisal
Tools: Forced Distribution
• Sun Microsystems
-the Bottom 10% of each group of 30
employees Get 90 days to Improve

• With Forced Distribution grading

system one either is in Top 5 to 10%
and gets an “A” on he/she does nt.
No Questions are asked.
Performance Appraisal
Tools: Forced Distribution
• To protect against Bias Claims,
employer’s should;
i. Appoint a Review Committee
to Review any employee’s
Low Ranking take several
ii. Train Raters to be Objective
iii. Consider using Multiple
raters