The Performance Management Cycle

Figure 1.0: Performance management process

Source: Performance Management System (370 DM 430) Frequently Asked Questions, Page 7, Office of Human Capital, U.S. Department of the Interior (October 1, 2018)

1.      Planning (Setting a goal)

Planning stage entails set and communicating the goals for employees. These goals should clearly mentioned in the job description during the process of attracting candidates and once again those goals should be communicated when the candidates becomes a new recruitment. This decide what to assign and how to do it (Armstrong, 2006). The organization need to assign a percentage for each of these goals as those to be evaluated their achievement.

2.      Monitoring (Managing)

One of the most important requirement to monitor the employees’ performance on goal by managers. Monitoring employees determines the level of progress and performance made regularly (Shane & Shane,2008). Monitoring is the exact phase that performance management comes into the picture and managers can track and evaluate employees’ performances by using appropriate automate performance management (software based), in real-time and modify and correct course whenever required (Pulakos,2004).

3.      Developing

In this stage managers can enhanced the employees’ performance by using the data gathered in the monitoring stage. It may require suggesting refresher courses, providing an assignment that helps them improve their knowledge and performance on the job, or modifying the course of employee development to enhance performance or sustain excellence. Also this is where the importance of 70:20:10 Learning and Development model taken place as this model suggests a proportional breakdown of how people learn effectively by challenging assignments, developmental relationships and coursework & training (Lombardo & Eichinger, 1996). The motivational potential of job resources can be essential as they facilitate growth, learning, and development, or extrinsic because they are instrumental for achieving work goals (Bakker & Demerouti, 2007)

4.      Rating

It is compulsory to periodically rate employees’ performance during the time of the performance appraisal. These ratings are essential to identify what has been achieved and, in the light of this, establish what more needs to be done and any corrective action required if performance is not in line with the plan (Armstrong, 2006). Supervisors or top management can provide these ratings for a 360 degree feedback.

5.      Rewarding

This is the final stage of the performance management cycle and this cannot be overlooked as it is most important for employee motivation. According to Torrington, Hall, Taylor & Atkinson (2009) “Motivation is the desire to achieve beyond expectations, being driven by internal rather than external factors, and to be involved in a continuous striving for improvement”.

Incentives and increments are a great way to reward employees who achieved their set goals while having some other rewards in the pool, such as promotions, bonuses, written appreciation, paid vacations, company-wide acknowledgement. But incentives or increments encourages employees to contribute more and more to the organization and that will enhance the effectiveness and productivity in the organization which both employer and employee benefited (Torrington, et al., 2009)

Video 1.0: What is the performance management cycle?

Source:  AIHR - Academy to Innovate HR, 02 Dec 2019

Almost all the multinational companies use this five steps of performance management cycle including “B.Braun Lanka Pvt Ltd” a subsidiary of “B.Braun International” in the process of performance management of their employees. This cycle helps to develop performance management systems and understand the needs of employees in terms of goal setting (SMART), learning & development, identifying gaps and identifying competencies. The organization experienced the benefit of applying this performance management cycle for managing performances over the years. The process supports to satisfy the employees and in return the organization gains the recognition from the external environment often.

References

·         Academy to Innovate HR. (2019)

·         Armstrong, M. (2006) Performance management: key strategies and practical guidelines .3rd ed. London and Philadelphia, Kogan Page

·         Bakker, A. B., & Demerouti, E. (2007). The job demands–resources model: State of the art. Journal of Managerial Psychology

·         Cardy, R. L. (2004). Performance management: Concepts, skills, and exercises. Armonk, NY, M. E. Sharpe.

·         Lombardo, Michael M; Eichinger, Robert W (1996). The Career Architect Development Planner. 1st ed. Minneapolis, Lominger.

·         Office of Human Capital, U.S. Department of the Interior. (2018), Performance Management System (370 DM 430) Frequently Asked Questions.

·         Pulakos, E. D. (2004) Performance Management A roadmap for developing, implementing and evaluating performance management systems. Alexandria, SHRM Foundation.

·         Shane, J. M., & Shane, J. M. (2008). Developing a performance management model: Your action guide to what every chief executive should know: using data to measure police performance. Flushing, NY, Looseleaf Law Publications.

·         Solomon, C. (2009). Select a performance management system.Performance improvement. Alexandria, VA,American Society for Training & Development

·         Torrington, D., Hall, L., Taylor,S. & Atkinson,C. (2009),Fundamentals of Human Resource Management. 1^st ed. Pearson Education Limited