EPFM 3724
Unit 1: Introduction to PM
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What is PM?
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Defining Performance Management
Video 1 Employee Performance
Management - What it is & Why it's
so important.mp4
Defining Performance Management:
Definition 1
According to Grobler, Warnich, Carrel, Elbert and Hatfield (2011), performance
management is:
− A formal system of periodic revision/ evaluation of individual performance
− The systematic description of task relevant strengths or weaknesses of
individuals to establish why they perform at a specific level and how, in
future, the employee will be able to improve this performance
− An ongoing process of evaluation and managing the behaviour and
outcomes in the work context
Defining Performance Management:
Definition 2
Pulakos (2009) states:
• Performance management is how organisations communicate expectations
and drive behaviour to achieve important goals;
• It is how organisations identify ineffective performers for development
programmes or other personnel actions.
• It is a key process through which work gets done.
Defining Performance Management:
Definition 3
Mondy and Noe (2005):
• Performance management is a process that significantly affects organisational
success by having managers and employees work together to set expectations,
review results, and reward performance.
Defining Performance Management:
Definition 4
According to Briscoe and Claus (2008):
• Performance management is the system through which organisations set work
goals, determine performance standards, assign and evaluate work, provide
performance feedback, determine training and development needs and distribute
rewards.
Therefore… Performance Management is
1. An ongoing process
2. that significantly affects organisational success
3. through which organisations:
• Set work goals, determine performance standards / expectations,
• Assign and evaluate work, provide performance feedback,
• Determine training and development needs,
• Distribute rewards
Defining Performance Management for yourself
Use your research skills to find more definitions of performance management and define it for yourself for
future use.
This will determine how you approach performance management one day in the workplace!!!!
PM and Talent Management
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Relationship between talent management and performance
management
• Talent Management is all about the identification and development of talent in organisational
context
(Gainsford & Van Zyl, 2012)
• Talent management is an organisation's commitment to recruit, retain, and develop the most talented and superior
employees available in the job market. Talent management comprises all of the work processes and systems that are
related to retaining and developing a superior workforce.
Performance management can therefore be seen as a component of the larger talent
management process.
Performance Management in the Employee lifecycle
Succession Planning
Training and Development
Performance Evaluation
Recruitment
Effective vs Ineffective PM
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Why Does Performance Management Often Fail?
• Managers are often reluctant to give honest and open feedback
because they don’t want to damage the relationship with the
employee
• Employees don’t feel comfortable discussing their development
needs with management as they might jeopardise their pay or
advancement.
• Managers aren’t competent in setting relevant performance goals
or following up on a regular basis.
• Many managers and employees don’t understand the benefits of effective performance management
Did you see how many times “manager” was mentioned.
Why? How can you make sure this doesn’t fail because of management?
Outcomes of effective performance management
Refer to Pulakos, 2009, pp 5
Outcomes of ineffective performance management
Reflection Questions
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Reflection Question
Below are some feedback from employees regarding the PM system used at company XYZ – Do you think the
PM system is effective? Motivate your answer by referring to the outcomes of effective and ineffective PM.
• “Some managers are very good at performance review, but most see it as an administrative burden and rush
through it, just to get it over and done.”
• “Most managers don’t seem to be very effective in working independently, they were so used to being told what to
do, that it puts considerable strain on them if there aren’t a lot of guidance.”
• “Employees just need to do their job; they don’t need praise”
• “My supervisor have no idea what I have to do each day, he continuously marks us down on things, but never tells
us why. He does not speak to anyone on the floor. This makes me feel less enthusiastic about my contribution”
• “I know what my job is but I couldn’t tell you what my objectives are.”
• “I don’t think any manager here can explain how my objectives relate to critical success factors”.
• “If anything goes wrong in my area, the first question they ask is who did it, instead of how can we fix/present this.”
• “Man it does not even matter how hard you work; everybody receives the same benefits at the end of the day.”
• “I don’t think anything new comes up at the appraisal. My manager just reiterates the same old story – Do your work
and you won’t get in trouble. . . Lately I can’t stand that guy.”
• “Initially I thought it was a worthwhile exercise but I now think it’s just total repetition. I know before I go in what kind
of conversation I’m going to have.”
• “Even though I tried my best, I still got a low rating, on my performance appraisal, it’s been 8 months since our
performance discussion and I am still unable to do the work, maybe I’m just not cut out for this job”
Where did we start and where
are we now?
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How performance management has evolved over time
• Today’s performance management is a result of the trial-and-error efforts
of past practices in order to address two key challenges
1. What type of performance should be measured
– Abilities
– Skills
– Behaviours
– Outcomes
2. How can we accurately, reliably, fairly measure such performance?
How performance management has evolved over time
1 All started with defining Rating Standards (1900s)
What are the standards against which performance will be measured.
“Start of a scientific management”
2 Next Abilities were evaluated
Used in World War 1 to assess Officer Ability
– What makes an officer an effective leader
• E.g. Ability to remain calm under pressure
– Ability to boost the morale of the troops
– Strategic and tactical thinking
How performance management has evolved over time
3 Scales were developed to measure job-related traits (1922)
• One problem with graphic rating scales was that the rating points were not well defined. For
example, a scale might have assessed whether an employee “Exceeded,” “Met,” or “Failed to Meet”
expectations, without articulating exactly what those expectations were. This left managers to
develop their own interpretations of the rating scale points.
How performance management has evolved over time
4 Further evolved to measure work outcome and behaviours (1950s and 1960s)
• Traits were often difficult to observe (conscientiousness)
• Focus shifted to observable measures of performance
– Objective (sales volume)
– Subjective (behaviours)
• Critical Incident technique was developed
– Examples of effective and ineffective behaviour (moved performance
measurement away from traits towards observable behaviours.
How performance management has evolved over time
5 Objectives-based performance measures (1954)
– MBO (Management by Objective) (Peter Drucker)
– Identify and define concrete & specific objectives so that both manager &
employees understood expectations
• Challenges of MBO approach
– Time intensive to set specific objectives for each individual
– Unforeseen changes meant objectives needed to be adjusted
– Objectives weren’t always in the control of employees
How performance management has evolved over time
6 Behaviour Based Measures (early 1960)
• Trend moved to quantifying job
behaviours
– Behavioural Anchored Rating Scales
(BARS)
– Behavioural Observation Scales
(BOS)
– Focused on those behaviours most
critical for job performance
How performance management has evolved over time
7 Behaviour based performance measures improved
– BARS example behaviours were too specific, it could be difficult to match
an employee’s performance to the very specific behavioural examples
used to anchor the rating scale
– General / Broad behavioural descriptions were developed.
– Made it easier for managers to match the behaviour they observed to the
rating scales
• Some form of subjectivity still required
How performance management has evolved over time
8. Civil Rights movement (1964) and the focus on fairness
– Discrimination in employment practices- minorities had systematically been
denied equal opportunity in areas such as housing, education, and
employment.
– Performance Management needed to be job relevant as it often resulted
in pay increase, promotion or termination
9. Multi-source Ratings
– Rating sources other than manager (peer rating; 360 ratings)
– Relationship defines what behaviours can be rated.
• E.g. customer is probably in the best position to judge someone’s
customer service skills.
How performance management has evolved over time
10. Competencies
Competencies are defined as the knowledge,
skills, abilities, and other personal
characteristics that are most instrumental for
achieving important job outcomes that
contribute to organizational success. A best
practice in the use of competencies for
performance management purposes has been
defining them in terms of behavioural
performance standards that describe different
levels of effectiveness in each competency
area.
How performance management has evolved over time
11 Results became the bottom line.
• Each individual is accountable for producing certain results
• It has become the best practice today to
assess both the result they achieve
(Outcomes) as well as the way they went
about achieving such results (Behaviour)
Next session:
Unit 2 – Chapter 3
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