Performance Management For Dummies
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Performance management is a continuous process of identifying, measuring, and developing the performance of individuals and teams and aligning their performance with the strategic goals of an organization. A performance management system is a key tool to transform people’s talent and motivation into a strategic business advantage.

The purposes of a performance management system

Performance management is mostly used for salary administration, performance feedback, and for learning about employee strengths and weaknesses.

Overall, performance management can serve the following six purposes: strategic, administrative, informational, developmental, organizational maintenance, and documentation.

Performance Management
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  • Strategic: To help top management achieve strategic business objectives
  • Administrative: To produce valid and useful information for making administrative decisions about employees
  • Informational: To inform employees about how they are doing and about the organization’s, customers’, and supervisors’ expectations
  • Developmental: To allow managers and peers to provide coaching to their employees
  • Organizational maintenance: To create a talent inventory and provide information to be used in workplace planning and allocation of human resources
  • Documentation: To collect useful information that can be used for various purposes (for example, terminations)

7 behaviors of effective performance management coaches

Within the context of performance management, coaching is a collaborative and ongoing process in which the manager interacts with direct reports and takes an active role and interest in their performance.

Coaching is a day-to-day, ongoing function that involves observing performance, complimenting good work, and helping to correct and improve any performance that doesn’t meet expectations. Coaching is also concerned with long-term performance and involves ensuring that each employee’s development plan is achieved.

Good coaching turns feedback into results. For this to happen, you need to engage in the following specific behaviors:

  • Establish development objectives. You work jointly with the employees in creating the development plan and its objectives.
  • Communicate effectively. You maintain regular and clear communication with employees about their performance, including both behaviors and results.
  • Motivate employees. You must reward positive performance. When you do it, employees are motivated to repeat the same level of positive performance in the future.
  • Document performance. You observe employee behaviors and results. You gather evidence about instances of good and poor performance.
  • Give feedback. You measure employee performance and progress toward goals. You praise good performance and point out instances of substandard performance. You also help employees avoid poor performance in the future.
  • Diagnose performance problems and performance decline. You must listen to employees and gather information to determine whether performance deficiencies and declines in performance are the result of a lack of knowledge and skills, abilities, or motivation or whether they stem from situational and contextual factors beyond the control of the employee.

    Diagnosing performance problems is important because such a diagnosis dictates whether the course of action should be, for example, providing the employee with resources so she can acquire more knowledge and skills, or addressing contextual issues that are beyond the control of the employee (for example, the employee is usually late in delivering the product because he receives information too late).

  • Develop employees. You provide financial support and resources for employee development (for example, funding training, allowing time away from the job for developmental activities). By helping employees plan for the future and by giving challenging assignments, you help employees learn new things.

About This Article

This article is from the book:

About the book author:

Herman Aguinis, PhD, is the Avram Tucker Distinguished Scholar and Professor of Management at The George Washington University School of Business in Washington, DC. He's been ranked among the top 100 most prolific and influential business and economics researchers in the world.

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