Performance management
Introduction
Performance management has evolved from the growing demand in organisations for
better people management in order to realise better results. The emphasis has shifted
from what employees are supposed to do, to what they are expected to achieve – results.
Employees’ output is a critical issue because it determines how much an employee is
worth to the organisation. This topic lays the foundation for skills development and
management of the employee performance process. Therefore, at the end of the chapter
learners should be able to:
- Analyse the key issues in the performance management system.
- Introduce and manage performance management systems in an organization.
- Examine the strengths and challenges of performance contracting.
The meaning of performance management
No understanding of the meaning of performance management is complete without fo-
cus on the management process, which aims at ensuring continuous individual, team
and organisational performance. Although the mainstream literature on performance
management is not short of good definitions on performance management, it is difficult
to resist the power of the definition commonly used by Michael Armstrong who is one
of the most renowned human resource management experts. In his view, performance
management is a process owned and driven by line management that aims at getting
better results from the organisation, teams, and individuals by understanding and man-
aging performance within an agreed framework of planned goals, standards and compe-
tence requirements (Armstrong 2008: 1)
The key words in this definition are:
- An agreed framework of planned goals, standards and attribute/competence re-
quirements – the basis of performance management is an agreement between the