Performance Management: Benefits and Concerns

© Copyright Carter McNamara, MBA, PhD, Authenticity Consulting, LLC. Adapted from Field Guide to Consulting and Organizational Development

Organizations try to manage the performance of each employee, team and process and even of the organization itself. The performance management process is very similar, regardless of where it is applied. Information in this topic describes the general performance management process. The information is customized for each application in the topics Employee Performance Management, Group Performance Management and Organizational Performance Management.

Sections of This Topic Include

4 Key Benefits of Performance management
15 Other Benefits
Concerns

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4 Key Benefits of Performance Management

1. PM focuses on results, rather than behaviors and activities
A common misconception among supervisors is that behaviors and activities are the same as results. Thus, an employee may appear extremely busy, but not be contributing at all toward the goals of the organization. An example is the employee who manually reviews completion of every form and procedure, rather than supporting automation of the review. The supervisor may conclude the employee is very committed to the organization and works very hard, thus, deserving a very high performance rating.

2. Aligns organizational activities and processes to the goals of the organization
PM identifies organizational goals, results needed to achieve those goals, measures of effectiveness or efficiency (outcomes) toward the goals, and means (drivers) to achieve the goals. This chain of measurements is examined to ensure alignment with overall results of the organization.

3. Cultivates a system-wide, long-term view of the organization.
Richard A. Swanson, in Performance Improvement Theory and Practice (Advances in Developing Human Resources, 1, 1999), explains an effective performance improvement process must follow a systems-based approach while looking at outcomes and drivers. Otherwise, the effort produces a flawed picture. For example, laying off people will likely produce short-term profits. However, the organization may eventually experience reduced productivity, resulting in long-term profit loss.

4. Produces meaningful measurements
These measurements have a wide variety of useful applications. They are useful in benchmarking, or setting standards for comparison with best practices in other organizations. They provide consistent basis for comparison during internal change efforts. They indicate results during improvement efforts, such as employee training, management development, quality programs, etc. They help ensure equitable and fair treatment to employees based on performance.

15 Other Benefits of Performance Management

Performance Management (PM):
1. Helps you think about what results you really want. You're forced to be accountable, to "put a stake in the ground".

2. Depersonalizes issues. Supervisor's focus on behaviors and results, rather than personalities.

3. Validates expectations. In today's age of high expectations when organizations are striving to transform themselves and society, having measurable results can verify whether grand visions are realistic or not.

4. Helps ensure equitable treatment of employees because appraisals are based on results.

5. Optimizes operations in the organization because goals and results are more closely aligned.

6. Cultivates a change in perspective from activities to results.

7. Performance reviews are focused on contributions to the organizational goals, e.g., forms include the question "What organizational goal were contributed to and how?"

8. Supports ongoing communication, feedback and dialogue about organizational goals. Also supports communication between employee and supervisor.

9. Performance is seen as an ongoing process, rather than a one-time, shapshot event.

10. Provokes focus on the needs of customers, whether internal or external.

11. Cultivates a systems perspective, that is, focus on the relationships and exchanges between subsystems, e.g., departments, processes, teams and employees. Accordingly, personnel focus on patterns and themes in the organization, rather than specific events.

12. Continuing focus and analysis on results helps to correct several myths, e.g., "learning means results", "job satisfaction produces productivity", etc.

13. Produces specificity in commitments and resources.

14. Provides specificity for comparisons, direction and planning.

15. Redirects attention from bottom-up approaches (e.g., doing job descriptions, performance reviews, etc., first and then "rolling up" results to the top of the organization) to top-down approaches (e.g., ensuring all subsystem goals and results are aligned first with the organization's overall goals and results).

Concerns About Performance Management

Typical concerns expressed about performance management are that it seems extraordinarily difficult and often unreliable to measure phenomena as complex as performance. People point out that today's organizations are rapidly changing, thus results and measures quickly become obsolete. They add that translating human desires and interactions to measurements is impersonal and even heavy handed.


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Also, scan the Recommended Books listed below. They have been selected for their relevance and highly practical nature.

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General Information -- Books About General Topic of Performance Management

Leadership and Supervision in Business - Book Cover Field Guide to Leadership and Supervision in Business
by Carter McNamara, published by Authenticity Consulting, LLC.
Includes step-by-step guidelines, tips and tools to effectively lead:
1. Yourself
2. Other individuals in the business
3. Groups and teams in the business
4. Business organizations
5. As well as all functions within the business organization.

Many of the Library's materials about business, leadership and management are adapted from this book. Just click on the title of the book above to see the Index and Table of Contents.
Leadership and Supervision With Nonprofit Staff - Book Cover Field Guide to Leadership and Supervision With Nonprofit Staff
by Carter McNamara, published by Authenticity Consulting, LLC.
Includes step-by-step guidelines, tips and tools customized for personnel in nonprofits to effectively lead:
1. Yourself
2. Other individuals in the nonprofit
3. Groups and teams in the nonprofit
4. Nonprofit organizations
5. As well as all functions within the nonprofit organization.

Many of the Library's materials about nonprofit leadership and management are adapted from this book. Just click on the title of the book above to see the Index and Table of Contents.

To get more information about each of the following practical books, just click on the image of the book. Also, a "bubble" of information might be displayed. You can click on the title of the book in that bubble to get more information, too.

Also see

For Your Own Performance Management
Personal Productivity -- Recommended Books

For Employee Performance Management
Supervision -- Related Books

For Group Performance Management
Facilitation and Teams -- Recommended Books

For Organizational Performance Management
Organizational Development -- Recommended Books

For Nonprofit Organizational Performance Management
Nonprofit Capacity Building -- Recommended Books




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