Performance Management Systems Are A Competitive Advantage
giant human resources consulting firm, Watson Wyatt
Worldwide, conducted a survey recently in which only
three out of ten workers surveyed say their company’s
performance management program does what it is intended
to do - improve performance. This is a very sad state
of affairs for American business. Another depressing
statistic revealed from this survey is that only 40%
of the employees stated that their system establishes
clear performance expectations or generates honest feedback.
is no secret that companies with effective performance
management systems are able to recruit and retain higher
quality employees, experience increased shareholder
value and consistently have better financial results
than organizations that do not have constructive programs.
are a few elements of a good performance management
goals and objectives are determined prior to
the review year. Having the ability to measure performance
makes the appraisal a much simpler exercise.
factors are defined for each position. The
competencies for an accountant are different than the
competencies for a computer technician. Items such as
customer service skills, teamwork and cooperation mean
different things for each position. Acceptable performance
for these factors must be defined at the beginning of
the review period. If you do annual reviews on a calendar
year basis define them now.
is customized to the organization. Off-the-shelf
or generic tools are for generic companies. Effective
organizations will institute programs that compliment
their culture and organizational objectives.
culture of continuous improvement is instilled
in the workplace. To stay competitive it is important
to remember that what was done last year is not good
enough this year. The companies that understand this
and incorporate this philosophy into their performance
management process will be more likely to succeed.
is tied to performance. Tying performance improvement
to compensation and pay increases give employees more
of an incentive to achieve better results.
Honest feedback both positive and corrective
is provided. With measurable standards, it
is much easier to assess the level of performance on
is continuous. An effective performance management
system provides feedback to employees throughout the
year. It is not just an annual event.
a performance management system to work well, employees
and managers must be fully engaged in the process of
continually improving performance. Pretty soon, your
competitors will be sitting up and taking notice. Make
it happen – implement some changes to your system.