Rethinking Performance Management - Research Paper Example

Rethinking Performance Management Table of Contents Task 1 2 Introduction 2 Critical evaluation of the process and core components of a typical performance management system; and different approaches used for measuring different performance levels 3 Impact of individual motivation in relation to performance management processes in organizations 4 Management styles and critical managerial skills for bringing about high levels of employee engagement 6 Opinion on the view “there is an underlying flawed belief that performance can be managed” 8 Conclusion 10 Task 2 11 Personal Reflection 11 Reference 13 Bibliography 15 Task 1 Introduction With the cut throat competition in the business world, the need for managing performance is felt in almost organizations. Organizations constantly incorporate such activities which ensure that goals are met and performance targets are fulfilled in efficient and effective manner in organizations. Performance management focuses on a wide variety of aspects, such as employees, departments and even the processes and services used in the organization. Researchers have found a close association between the implementation of performance management systems in organizations and productivity and performance of organizations. Managing the performance of employees is seen to facilitate the process of operational and strategic goals in the organization. However, researchers have come up with considerable findings demonstrating that PMS does not have a significant impact on the output and productivity of organizations. It is seen that one prominent factor which keeps PMS from acquiring its desired output in organizations is employee motivation. The present project seeks to bring forth the impact of motivation of employees in managing performance in organizations. Finally critical managerial styles and activities are recommended which can bring about higher employee engagement in organizations, which can facilitate the objectives of the systems. Critical evaluation of the process and core components of a typical performance management system; and different approaches used for measuring different performance levels The field of performance management comprises of two different types of management. According to one aspect, the system of performance is viewed by analysts as that which evaluates performance of the company as a whole and also evaluates the role management and senior heads of the company in reaching goals. From the different aspect, performance management is looked at as a system which evaluated employees’ performance and helps them reach organizational goals and objectives. A typical system of performance management includes planning work activities, setting goals and objectives, offering reviews and feedback, providing opportunities for learning more in the desired field, and finally rewarding employees for favourable performance. These aspects are essential for any performance management system in any organizations. However, it is seen that the system differs in organizations with respect to employee performances. For example, certain aspects are emphasized more for managing poor performance, moderate performance and good performance. The two main aspects which differentiate between a performance management system (PMS) for poor performance, moderate performance and high performance are leadership and training programs. Leadership skills and training are considered two main drivers of performance management. Traditionally the system of managing employee performance is viewed as the actions taken by managers in response to an employee’ activities for improving his performance. It is seen that the main criteria which distinguishes between high performance management structures and low or moderate performance management structures are training programs and leadership development programs. Low performance management structures are necessarily driven by training and development programs. They are mainly aimed at improving performance at the ground level. They are highly in technical in nature and reflect through the efficiencies and productivity of employees in the organization. On the other hand, it is seen that high performance activities reflects positively through the financial and economic performance of the organization on the whole. They can bring about such an extent of improvement in productivity of employees that it subsequently has a significant level of improvement of the business performance of the organization. There is hardly any evidence which demonstrates that firms are likely to suffer by adopting a well planned and high performance driven management system (Kumar, 2001, p.3). Impact of individual motivation in relation to performance management processes in organizations One of the key issues in organizations is whether the performance management systems are as good to the employees as they are for the organizations. Researchers have found a close association between the adoption of high performance management systems in organizations and downsizing and layoffs. Consequently it can be said that a very close association exists between performance management systems and motivation level of employees in organizations (Vroom, 1990, p.5-7). According to the views of Pfeffer (1998), employee motivation bears a direct link between the security at the workplace and their motivation level in the organization. Thus, the fact that performance management systems are associated with such aspects as downsizing and lay-offs also has an indirect influence over their motivation levels which consequently renders the system ineffective or far below the standard it desires to perform. It is seen that even the best measures of managing performance fail to yield the desired level of performance from employees as they fail to generate motivation, trust and commitment among them as they feel insecure about their jobs at the workplace (Kumar, 2001, p.3). The research findings, and one of the most largely accepted propositions in the high performance work systems is that innovation at the work place and in work practices designed for maintaining and improving productivity and others performance aspects of firms are not necessarily likely to be sustainable in the long run or over time because of the employees’ feeling that increasing productivity would eventually work themselves out of jobs. The discussion entirely revolves around the fact that a qualified and motivated workforce is essential for increasing productivity and quality of services and products in the organization and performance management systems which fails to bring about improvement in motivation of employees fails to attain the productivity targets (Kearney & Berman, 1999, p.5). On the other hand, evidences prove that high performance systems coupled with performance pay incentives are likely to yield desired results and productivity at the workplace. Some of the effective use of rewards, bonus and incentives schemes in organizations can be cited in this context as examples of how they have been effective in enhancing and increasing motivation of employees which have subsequently reflected through improved productivity and performance in the organization. For example, the Canadian performance pay scheme for the management category was particularly effective in improving the effectiveness of the system in terms of employee productivity. In the United States, the scheme of performance bonus was particularly introduced and included for the position of senior executive service to attain greater motivation and productivity improvement from employees at the workplace (Mwita, 2002, p.127). Similar steps were also taken in Canada with the aim of upgrading performance of managers. The performance pay scheme introduced for the management category of the organization had a favourable impact in motivating managers which in turn was responsible for accounting for the efficiency and effectiveness of the system (Mwita, 2002, p.127). Management styles and critical managerial skills for bringing about high levels of employee engagement Employee engagement has long been regarded as a crucial aspect in business. Academic researchers and consultants have brought forth a strong association between business performance and employee engagement. However, employee engagement is not an independent factor and works under the influence of strong leadership and management forces. Improper and ineffective leadership fails to attain desired engagement of employees and productivity at the workplace. Authors have especially focussed on the importance and criticality of situational leadership in the management of performance at the workplace (Selman, 2002, p.1). This style of management and leadership is attributed particular importance in attaining greater employee engagement and performance at the workplace. Situational style of leadership or management is instrumental in providing the guidance to the people and the coaching they need throughout the period of performance management. During the inception of the system, leaders take the responsibility of setting the participation for goal setting and planning. During the remaining period of the system, situational leadership plays the role of guiding the leader to interact with followers in attaining the maximum engagement and performance out of them (Hersey & Chevalier, 2000, p.3). On the other hand, Likert (1947) have shown that in the participative management system, motivational forces of employees generate from economics, ego and group involvement in decision making and goal setting. Under this style, there is a high extent of interaction between management and employees which consequently accounts for the trust and respect between them. Management controls remain self monitored and productivity remain excellent under this particular style of leadership. Likert puts forth the argument that managers must strive to generate a participative style of management if they aim to maximise quantity and quality of employee performance at the workplace (Khan, 2010, p.9). Google is one organization which has effectively made great and fast strides through participative style of management. It has attained maximum participation and engagement of employees by placing employee welfare, employee views and suggestions as high in the agenda. It has driven dramatic employee performance and productivity through the participative style of leadership (MacLeod & Clarke, 2009, p.48-49). Academic research has made very little advancement in exploring the areas of management and leadership behaviours which drive employee engagement at the workplace. However, Schneider and Macey (2008) have suggested that transformational leadership can play a critical role in driving employee engagement (Palshikar, 2010, p.4). Researchers have particularly differentiated between the roles of senior management and line management in fostering employee engagement. Researches conducted by the CIPD (2010) have differentiated between the perceptions of line managers and senior management and their influence over employee engagement. Positive and favourable perceptions of line management have significantly impacted over employee participation and engagement at the workplace. It is considered essential for line managers to ensure that the right candidates and people are appointed at the right place and that the objectives and goals for employees are communicated in transparency, employee efforts are adequately and properly rewarded and adequate opportunities for promotion and development of employees are provided to them. On the contrary, negative perceptions about the senior managers and leaders are seen to bear relations with employee engagement. Researchers have focussed on the importance of senior managers to effectively communicate about organization’s missions and vision and adopt a transparent, open and approachable management style if they are to maximise employee engagement and performance at the workplace (CIPD, 2011, p.5). Opinion on the view “there is an underlying flawed belief that performance can be managed” The study reveals that despite the numerous difficulties in implementing and incorporating an effective and flawless performance management, it is considered an imperative part of management of organizations. Anything which can be measured can be managed. The first step in managing performance is setting performance expectation targets for individuals and groups with the aim to channel their efforts towards attainment and accomplishment of those objectives. On the other hand, an organization devoid a system of managing performance of the workplace would be ineffective to determine or realise its performance targets. Thus it can be said that there is no flaw in the belief that performance can be managed. It is imperative and essential for any organization operating amidst the competitive business conditions and environments. The effectiveness of performance management systems lies greatly on aspects of employee motivational factors and the right and appropriate management skills and expertise which play a crucial role in developing the system. Despite the numerous flaws and criticality of the process, it is something which management cannot do without. Without an effective performance management, the performance of the workforce would go hay way and would not be directed towards the desired direction for accomplishing organizational goals and targets. The continuous and regular requirement for close monitoring and supervising of employee performance is felt in almost all organizations. The countrywide representative survey on a sample of employees in the United States by Rogers and Freeman (1999) throw light on the fact that more than 40% participation of employee engagement can be achieved through an effectively designed performance management system (Kumar, 2001, p.5). In fact, despite the diverse drawbacks and flaws in the system, the complimentary activities in organizations are increasingly on the rise. Over 80% of the organizations have reported to be using three or even more number of work practices on their employees. According to Osterman (1999), organizations’ ability to sustain performing work practices continue to remain high even if there is high lay-offs and downsizing (Kumar, 2001, p.11). Despite the long and diverse list of obstacles which hinder towards the spread and implementation of performance management systems in organizations, there are numerous forces which claim and demand for required information on performance of the workforce. This is required not only for the present functioning of the firm but also in its future business strategies. One of the prime sources which demand accountability of firms’ performance and productivity are from the general public, media and even interest groups and advocates. The growing need to enhance authority and accountability has intensified the need for having good performance management systems in all sectors of businesses (Salem, 2003, p.14). Conclusion The study reveals that the system of performance management is highly complicated and demands close study and scrutiny in order to be effective. Despite the many difficulties and hurdles in implementing the system successfully, is has been an imperative part of mostly all management strategies and are incorporated in all sectors of businesses. It is seen that the success of such a system depends largely on the motivation of employees. An ill framed PMS system only ends up ruining the motivation and participation of employees render the system ineffective. Researchers have recommended situational, participative and even transformational leadership styles in some cases. The trick lies in attaining as much participation and engagement of employees in the process as possible. Proper rewards and incentive structures included in the system has demonstrated improvement in participation and commitment of employees through the system. Task 2 Personal Reflection This module has been greatly beneficial in improving my theoretical and practical knowledge of the subject of human resource management practices in organizations. This is particularly in the domain of managing performance of the workforce in organizations. The various critical factors which account for a successful management system of performance are clear and transparent to me which would help me in my future endeavours in the domain of HRM. The understanding of the subject would surely assist me in realising my long term future plans becoming a Human Resource Manager in an organization. One of the critical functions of a leader or a manager is to realise the potential and latent talent of followers at the workplace. The study of application of appropriate leadership styles and in particular situations provides me with the ability to apply them in reality and attain the maximum participation and commitment of employees. The study provides me with the basic knowledge of suitability of particular leadership styles in particular context. The knowledge that situational and participative management or leadership styles are effective in attaining employee engagement and participation at the workplace would benefit me when I would have the responsibility of implementing a performance management system at the workplace. My role as a human resource manager would largely require me to bring out and realise the potential of employees in the organizations through effective management systems of performance. The knowledge of rewards incentives, and bonuses that I have gained in the module and their consequent effects in realizing performance targets would definitely help me aligning my work activities in such directions which yield maximum engagement and participation of employees. One of the major understandings of the module has been in the areas of employee motivation and performance. Motivation plays a determining factor towards effectiveness of performance management systems in organizations. My role as a human resource manager would require me to enhance and improve motivational level of employees in the organization and attain the maximum efforts from them towards the desired goals and objectives of the organization. Various aspects such as employee recognition, rewards, pay structures and incentives which bring out and enhances performances of employees would develop me to apply them in practice and accomplish organizational objectives as a human resource manager. Most importantly I have gained the knowledge and learning of the various hurdles in implementing a performance management system at the workplace. This would help in removing, eliminating and even avoiding those hurdles as a human resource manager in the organization. This is with reference to the various management styles and leadership styles which encourages employee performance at the workplace. It is seen that employees get de-motivated through various performance systems due to lay-offs and downsizing. My role in motivating them at the face of downsizing gets largely enhanced through such avenues and strategies as work recognition and rewarding of employees. Thus it can be said that my entire learning through this module would help in exercising the duties and responsibilities of a human resource manager successfully in the organization. Reference CIPD. (2011). Management competencies for enhancing employee engagement. [Pdf]. 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