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What exactly is performance management?

by , 17 June 2014
'Performance management.' Managers throw these two words around a lot in the workplace.

But, our experts think most managers don't really understand the meaning behind these two words and, as a result, are missing the boat when it comes to managing employee performance.

Don't fall into the same trap.

Continue reading to discover what performance management really means so you can successfully manage your employees.

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Performance management explained

Experts behind the Practical Guide to Human Resources Management summarise performance management as the following processes or activities in an organisation:

#1: A description of the work employees need to do to make a noticeable contribution to the company's results. You'll do this by defining roles and responsibilities of positions and setting goals at the beginning of a review period.

For example, you employ Thandi as a customer relationship manager. Her role is to ensure that all customers are satisfied with the service of the company.

One of her responsibilities is to regularly assess and address customer service levels. One of her goals for the upcoming review period is to develop and implement a customer satisfaction survey by August.

#2: Defining and agreeing on the standard you require. This is the standard at which your employees must deliver the work and the measures you'll use to define their success.

For instance, one of the standards to define if Thandi has developed and implemented the customer survey successfully might be to get a 30% response rate on returned questionnaires.

#3: Regularly reviewing work that your employees deliver. This is the part where you direct, correct and recognise employees for their efforts in delivering on objectives.

Note: In a true performance driven company culture, performance review and discussions must happen on a continuous basis.

Here's the bottom line when it comes to performance management.

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Use performance management as follows

You must use performance management to focus your employees on goals and activities that are aligned to delivering strategic objectives of the company. This is, after all, one of the reasons you hired them – to help your company to grow and meet its goals.

We hope this explanation will help you manage your employees' performance better.


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