The Difference between Performance Management and Performance Appraisal - Essay Example

Running Head: Performance Management Name Course Instructor Date Performance management and performance appraisal are two notions that are used in the field of evaluation of employees efficiency (Mumford, 2008). However, it is worth noting that they are two different aspects. Performance appraisal involves setting of standards and evaluation of their performance. In other words its evaluation is based on standards that have earlier been set. Performance management is all about managing the performance in state time so that it can reach the expected level (Boswell & Boudreau, 2001). In other words it involves the use of interrelated strategies and activities that are aimed at improving the performance of individual employees, teams and organizations. It is therefore aimed at making sure that the organization achieves the set goals (Boswell & Boudreau, 2001). Performance appraisal is a very important aspect in managing the performance of an organization. This is attributed to the fact that, it provides the employees with the descriptions and evaluation of work expectations (Rachman-Moore & Kennett, 2006). It is noteworthy that, good performance appraisal is important to both the employees and the organization. it cultivate for common understanding of individual needs, work objectives and standard of acceptable performance. Performance management on the other hand helps the organization’s management to monitor and respond to how the organization is delivering against its goals, mission and the outcome that is required of it (DeNisi & Kluger, 2000) For a performance management to be successful, it must link the organizational, business and individual planning and performance (Rachman-Moore & Kennett, 2006). This therefore entails that, it has to clarify performance objectives which are linked with the organizational business plans. Have frequent performance appraisal of individuals or teams against the achievement of these objectives, get feedback from these appraisals, have growth and development programs and finally should have accurate and transparent reward for performance (Jena, 2009). Performance appraisal has limitations. It is a function that only emphasizes on the evaluation of the past performance only and is done only once or twice a year. It is therefore worth stating that it is all about distinct staff activity (Thomas et al, 2008). Contrary to this, performance management is a continues function for it is done every now and then to ensure that al the employees discharge all the capabilities in ways that ensure that the targets are achieved in real time basis (Rachman-Moore & Kennett, 2006). Performance management lean so much on employee’s work while performance appraisal is more standardized with its emphases on the designation of the employees of the organization. This is a clear indication that both performance appraisal and performance management work hand in hard to enable the organization perform towards the achievement of its goals and objectives (Tom, 2009). This being the case, the implementation of performance management systems is a crucial connotation in any given organization (Rachman-Moore & Kennett, 2006). A successful performance management system should serve the business function whereby it gives a clear platform for a good communication between a supervisor and an employee. This in long run helps the organization success to being in a competitive advantage and helps the employees improve performance (Stephen, 2007). It has been noted that, what gets watched gets done. Performance management systems therefore should be selected with an aim of achieving the corporate goal. The appraisal criteria involves: traits, competencies, goal achievement and improvement potential. Attitude, appearance and initiatives are the commonly used traits in the evaluation of an employee (Kelly & Swindell, 2002). However, they are subjective and therefore may not be related to job performance. Inaccurate evaluations may therefore occur and cause legal issues for the organization as well. Behavior is yet another factor that is used to determined and evaluate a workers task related competencies (Rachman-Moore & Kennett, 2006). For instance working in teams, developing others, cooperation, customer service might be appropriate to determine and evaluate a leadership style. Desirable behavior is also appropriate in evaluation for if they are recognized and rewarded, there are higher possibilities that the employees will repeat them to the good of the company’s performance (Heckman, 2002). Competencies include traits, behavior and skills which are technical in nature but are business oriented. All jobs require competencies and therefore the selection process must involve all this. Organization consider ends important than means. This being the case, goal achievement outcomes are an appropriate factor to evaluate (Rachman-Moore & Kennett, 2006). However, the outcome should be within control of an individual or team and should entail those results that lead the organization to success (Tom, 2009). Employee development in order to achieve the goal is therefore an important aspect for positive results. Finally, organizations evaluate their workforce performance using the past performance (Boswell & Boudreau, 2001). From the performance management perspective, the past can never be changed but there steps that can be taken to change the future, including the behaviors and outcomes that the firm needs to achieve its goals. Supervisors and managers have the obligation of managing the performance of employees (Tom, 2009). For the success of the performance management system used, it must align with their policies and best fit the nature of their worth plus the mission of the organization (Rachman-Moore & Kennett, 2006). Furthermore, the managements must first communicate the employee performance expectation. This will involve making known to the employees how their performance will be measured and how their success will be determined (Boswell & Boudreau, 2001). Secondly, there should be a continuous performance dialogue. In this case, the employees shall be held responsible for meeting their performance expectations and finally, performance appraisal should be a prerequisite (Rachman-Moore & Kennett, 2006). Supervisors have to evaluate employee’s performance during the last years so as to compare it with the expected performance. Everything has to be accurately documented. When all this is applied in the implementation of the performance management system, then the success of the same is guaranteed (Boswell & Boudreau, 2001). The support of the senior management is very vital in determining the success of performance appraisal system. The executive and the official’s assigned duties in managing the system need to come up and communicate the vision (Boswell & Boudreau, 2001). This being the case, there is a need to access outside expertise or even taps internal expertise. In this case, having some information from outsiders who have successfully implemented a performance management system allows an organization to take that advantage of the lessons learnt by others and avoid making some of the common mistakes (Boswell & Boudreau, 2001). Incase an organization gets into the process of having a system that they do not clearly understand; there are high possibilities that it is going to fail. Implementing a successful performance management system requires skills which the current workforce may not have or maybe have not used for a long time. There is therefore a need to train them so that they can clearly understand the concepts and practices so that the system framework and structure can be appropriate (Boswell & Boudreau, 2001) Managers also need to have knowledge of how performance management systems can support improved results and how the data collected can be used to make decisions aligned to their performance. Training on the other hand will create a better position for achieving an understanding of the whole system an most of all it helps avoid resistance (Rachman-Moore & Kennett, 2006). A system that is implemented where there are adequate resources is deemed to succeed. Otherwise, incase the resources are not available, failure is inevitable (Rachman-Moore & Kennett, 2006). People, expertise, technology and money are prerequisites in implementing a successful system, in the collection of data, storing it, analysis and reporting. There is therefore a need to ensure that all the required resources are available when having a system in place so as to be assured of its success (Angelo & Robert, 2006). Is worthy noting that, performance management systems concerns the performance of the employees, there is therefore a need to instill a sense of fairness in their minds based on comparisons (Glendinning, 2002). In other words, the employee compares their inputs and efforts, job performance and comparison with others. There is therefore a need to ensure that, they feel that their compensation is fair. This will act as a motivating factor and in the long run will improve of their performances. When there is biased compensation, then the workforce may not trust the whole system and it may result to failure (Mumford, 2008). Since performance appraisal is all about individual’s performance, then there is a need to have well defined job descriptions. This is also attributed to the fact that, employees will only do what has been delegate to them (Hannay & Shelton, 2008). In other words, they are accountable of everything that they do and therefore they will monitor their own performance. Vagueness gives a chance of employees o blame their seniors, environment, systems or even each other, incase of any failure. There is therefore a need to have job descriptions for every individual which should be an outline of key tasks in accountability (Glendinning, 2002). Performance management system involves performance appraisals to determine the steps to take so as to improve performance. This task however has been labeled the most frustrating human resource management activity for at times it creates conflicts between supervisors and employees, which in the long run results to dysfunctional behavior (Glendinning, 2002). There are mistakes that are associated with performance management appraisal which should be avoided in order to have effective performance management system (Nickols, 2007). Managers may tend to generalize one positive performance feature to all aspects of employees performance which may result to higher rating (Glendinning, 2002). This is referred to as halo error. Consequently, the opposite of this is when the manager generalizes one negative performance incident to all aspects of employees resulting to lower rating. Clear analysis should be performed on the data to avoid such errors. It can be very devastating on the side of employees who suffer the consequences of a generalized evaluation (Rachman-Moore & Kennett, 2006). Additionally, there are some managers who are too generous with praise or even others who are too hard on an individual. Leniency is giving high ratings to an employee. This is an occurrence which is attributed to an avoidance of appraisal controversy (Glendinning, 2002). When managers are evaluating employees for administrative purposes, like pay increase, they are most likely going to be more lenient than when they are doing so for the purposes of employee development (Mumford, 2008). This is an error that can result to failure to recognize correctable deficiencies. Moreover, it may even result to depleting the merit budget and in the long run affect the rewards of other better performing employees and most unfortunately, may put the organization in a position where it will be difficult to terminate poor performing employees who have continuously received positive evaluations (Robert, 2002). Manager may also be unduly critical of an employee work performance which may result to a notion referred to as strictness. This may be as a result of lack of understanding of various evaluation factors (Rachman-Moore & Kennett, 2006). In this case, the week performance may end up getting high pay increased and promotions from a lenient manager, while a strict manager shortchanges the stronger employees. This lowers the morale of the employees who are the top performers and in the long run will impact on the performance of the entire organization (Mumford, 2008). The evaluation appraisal can also be incorrect by rating the average or middle class employees. This is central tendency error. This mostly occurs in performance management systems which require the managers to justify in writing the low and the high ratings (Mumford, 2008). This may in the long run result to undermining the compensation system. Performance management system should be designed in such a way that, all the possible errors and are eliminated and also in ensuring that, the executive involved in the performance appraisal understand all the processes so as to avoid biasness (Keeping & Paul, 2000). Conclusively, while the evaluation process is all about producing value for money, employees are the key to high performing companies and rewarding them is beneficial to effective performance management and a fundamental aspect in any successful setting. It is therefore important to balance between managing resources and achieving outcomes and also managing individual behavior through value based system. The entire system should be transparent so as to ensure that the appraisal is accurate for the good of all employees and that of the entire organization. References Angelo S. DeNisi and Robert D. Pritchard (2006), “ Management and Organization Review 2:2 253–277, 1740-8776 Boswell, W. R. and Boudreau, J. W. 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