Operation of Performance Management Systems Literature Review

Pages: 19 (7293 words)  ·  Bibliography Sources: 14  ·  File: .docx  ·  Level: Master's  ·  Topic: Business

Operation of Performance Management Systems

The idea of managing performance is not new, but the way in which performance management is handled is changing. New systems and new ideas about what motivates employees and causes them to do their best work are being studied, along with adaptations of the older ideas created by individuals such as Maslow and Herzberg. No matter what kind of company is considered, addressing the issues with employee performance can deeply affect the bottom line. When employees are happy they are much more likely to do a better job, which helps the employees and the company. It is difficult to force an employee to perform in a better way for a long period of time, but it is quite possible to provide the employee with incentive to perform better -- and that is at the heart of managing employee performance.

Introduction

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Managing performance is a wide, over-arching concept. It can be used to manage the performance of a person, a department, a company, or even a particular process. Performance management systems are a part of human resources, and they are used to ensure goals are met. Those goals need to be met both efficiently and effectively, or the company will suffer. Monitoring employee performance is more complicated than just making sure that employees are working designated hours. What those employees are doing and how they handle and manage their time are both highly significant in considering the bottom line of the company. What causes a person or company or department to perform in a way that pleases the employees and the bottom line? Incentives. The employees must feel as though they are getting something for the work that they are giving the company -- and often that "something" must be more than just a paycheck and/or benefits.

Literature Review on Operation of Performance Management Systems Assignment

While being well-paid for the work one is doing is important, and getting benefits like health insurance can also greatly affect how a person feels about his or her job, employees generally need things that matter to them and that will be part of their lives for a long period of time. Overall, each employee is different and it can be difficult to determine what the best choice is when it comes to offering performance incentives. Companies have to make money, but if they strive to give their employees what those employees need the companies can often well offset the costs of the benefits they are offering. Performance management is the term that encompasses this, and has been in use since the late 1970s. It addresses technology that manages results and behavior -- both of which are critical elements when considering performance. In order to use the technology of PM, however, a person or company must know how to get the desired results and behavior, and that requires a study of motivation as it relates to employees.

Findings

The Background and Definition of Performance Management

Performance management is most commonly seen in a work environment, but wherever people interact with one another PM can be used. This includes community meetings schools, churches, sports teams, political settings, and more. When people interact with each other and their environment to produce a desired effect, PM can come into play -- and most people do not even realize it. In 2000, Austin & Carr identified PM as an approach that was both integrated and strategic, and that increased an organization's effectiveness by raising the performance level of people who work in those organizations and by developing capabilities in both individual contributors and teams.

Getting all of the employees in an organization to reconcile their personal goals with the goals that are held by the organization is something that really is possible when PM is used. This is part of what is called the self-propelled performance process (SPPP). In order to get everyone "on the same page" so to speak, a mission statement is needed for each job and an analysis of the commitment to that job must be undertaken. In the mission statement, it is important to include the purpose, product, scope, and customers. By creating a strong and complete mission statement for each job, the organization will be able to identify the performance standards and the key objectives for each job. Then, the organization can better determine what kinds of incentives can be offered to employees in order to ensure that those employees work hard to meet the objectives and standards of the job to which they are assigned.

When an organization dedicates itself to the performance of systems or the management of employees, it is able to create an effective delivery of both operational and strategic goals. The correlation between the use of PM software or programs and the improved results of a business or organization is too strong to ignore. Integrated software can provide information much more quickly than a spreadsheet-based system. That can offer a return on investment (ROI) that is highly significant for any business. Both direct and indirect benefits appear and those benefits can be adjusted and manipulated in a way that will allow greater enjoyment for employees and a better bottom line for the business for which those employees work. When PM is used correctly, it is much easier to see the potential in every work day of every employee. That can provide benefits such as a growth in sales, a reduction of organizational costs, and a decrease in the time it takes to make important changes.

The value of a motivated workforce cannot be overemphasized. When employees see how they are directly contributing to the company, and when the employees are being rewarded for that contribution, they want to work harder and do more than they otherwise would. While PM can be used to study their performance and discover ways in which the employees can do things differently to make the company (and, therefore, also the employees) more profitable, the employees must be motivated in order to do a good job. If there is no motivation, there is no point in addressing PM because the employees are not likely to get onboard what the company is attempting to do. Fortunately, motivation of employees is something that has been extensively studies in the past. In order to completely understand PM and the broad definition of performance management as a function of human resources, motivation must be addressed and explained.

Motivation in the Corporate World

Originally, it was only the corporate world that was looking at its employees in ways that included more than just how those employees were being paid. However, that trend is now spreading beyond corporations and into sales and other industries (Bedeian, 1993). Because that is the case, and because management the performance of employees is much easier to do when employees are motivated, it is important to look at trends in compensation and how those trends are being used to help ensure that companies all around the country and the world are able to continue to motivate their employees and grow their bottom line. A reward system for all of the employees is one that will track employee progress but that will also help the employee be more productive while remaining in line with the mission that is held by the company and/or by the industry as a whole.

Mostly, the mission of a company has been straightforward -- to produce goods and services that are high-quality, have strong customer service, and have a workforce that is professional and dedicated. That is easier said than done, of course, but it is also something that can be accomplished and something that can be measured. If employees are not properly compensated for the work that they are asked to do, it is very unlikely that those employees will be able to provide the company with the dedication for which it is looking. The company will then have two choices -- let the employees go and hire new ones, or find ways in which the employees can be motivated to do what the company is looking for in terms of work ethic and customer service. The right kinds of compensation opportunities can skyrocket profitability for a company, and the performance management program will show the growth and development of the bottom line more rapidly than in the past.

The motivation of employees does not come easy. Many people want to work because they want to be paid, but they find that they are only interested in the check and the insurance benefits. They continue to do what they need to do to get by so that they do not lose their job, but that is the extent of their commitment to the organization. That lack of commitment can be seen in performance management, when it becomes clear that productivity is not what it should or could be and the employees who work for the company are not dedicated to doing everything they can to move the company forward. In short, the goals that the… [END OF PREVIEW] . . . READ MORE

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