A Truly Effective Performance Measurement and Performance Management Systems - Essay Example

When performance is at par or even better than standards previously set, then the business' financial condition also improves. Budgets are either increased or decreased in support of better organizational survival Since there are usually many competitors around. When performance measured passes the standards set, salary and other benefits are given for satisfactory performance. Management must have a meeting with the line and staff organization and the organization's goals, strategy, mission, vision, values, and strategy to accomplish the goals, purpose of goal and standard-setting must be implemented.

The employees and stockholders are encouraged thru regular training/meetings that they are part of the success and failure of the entire organization. The performance measures give the employees the daily challenges to be conquered. Integration places standards were needed in accomplishing strategic business ventures. Integration also helps hasten change. When actual work is compared with performance, the difference or similarity of the actual against the standards set is compared and management makes the needed decisions for the further improvement of overall activity. 2.1 Performance Measurement - Measuring performance quantitatively tells us whether our goods, services are done by employees have increased or decreased or even remained the same.

They help management decide on ways and means to improve the performance of some products which have not been performed according to pre-set goals. Measurement performance can tell whether the following criteria are in order: a) We are doing as pre- expected b) If customers like our product/service and come back. c) If manufacturing processes are controlled. d) Adjustments can be made to improve present performance. Performance measurement provides us with the needed details to make intelligent decisions.

Performance is usually done by taking done the number of units and unit price of goods sold or cost of goods bought. The products could be listed as 1,000.,000 units of product sold at $5.00 each. The actual units sold or produced by the manufacturing department are then compared with pre-determined standard or goals which was agreed upon. Usually, the standards or goals are agreed upon between all departments involved. A too high standard may cause some discouragement with the employees. A too low standard may sometimes cause idleness.