1. HRM751
OVERVIEW OF PERFORMANCE
MANAGEMENT
 NUR SYAZANA BINTI HAJI AZMAN HISHAM
 2012423038
 ASSOC. PROF. DR ROSHIDI BIN HASSAN

2. Performance Management

3. Definition of
Performance Management
(PM)

4. Definition of PM
1.
Continuous Process of
Identifying
Measuring
Developing
The performance of individuals and teams and
2.
Aligning performance
with
Strategic Goals of the organization

5. Definition of PM
(continued)
„…the process where steering of the
organization takes place through the systematic
definition of mission, strategy and objectives of
the organization, making these measurable
through critical success factors and key
performance indicators, in order to be able to
take corrective actions to keep the organization
on track‟ (Waal, Goedegebuure, & Geradts,
2011).

6. Definition of PM
(continued)
Performance management can be regarded as a
systematic process by which the overall
performance of an organization can be improved
by improving the performance of individuals
within a team framework (Singh, 2012).

7. Definition of PM
(continued)
Effective performance management-involving a
complete system of goal setting, training,
communication, and ongoing feedback-is a
practice on which research often has important
implications (Helm, Courtney L, Frank R, &
Christine, 2007).

8. Definition of PM
(continued)
PM is “something that people actually do and
can be observed . . . Performance is what the
organization hires one to do, and do well.
Performance is not the consequence or result of
action, it is the action itself” (W. Smither &
London, 2009).

9. Performance
Management
is NOT
Performance
Appraisal

10. Philosophy of
Performance Management

11. Performance Management
Philosophy
Belief of employee
performance need to be
managed, to ensure that
organizational goal will be
achieved

12. Contributions of
Performance Management

13. Contributions of Performance
Management
For Employees
 Increase motivation to perform
 Increase self-esteem
 Clarify definitions of
 job
 success criteria
 Enhance self-insight and development
 Motivation, commitment and intentions to stay in the
organization are enhanced

14. Contributions of Performance Management
For Managers
 Managers gain insight about subordinates
 Employees become more competent
 Better and more timely differentiation between good
and poor performers
 Communicate supervisors‟ views of performance
more clearly

15. Contributions of Performance Management
For Organization/HR Function
 Organizational goals are made clear
 Fairer and more appropriate administrative actions
 Better protection from lawsuits
 Facilitate organizational change

16. Disadvantages/Dangers
of
Poorly-implemented
PM Systems

17. Disadvantages/Dangers of Poorly-implemented
PM Systems
For Employees
• - Lowered self-esteem
• - Employee burnout and job dissatisfaction
• - Damaged relationships
• - Use of false or misleading information

18. Disadvantages/Dangers of Poorly-implemented
PM Systems
For Managers
Increased turnover
Decreased motivation to perform
Unjustified demands on managers‟ resources
Varying and unfair standards and ratings

19. Disadvantages/Dangers of Poorly-implemented
PM Systems
For Organization
Wasted time and money
Unclear ratings system
Emerging biases
Increased risk of litigation

20. Reward Systems

21. Reward Systems
Motivation to obtain
rewards is one of the
fundamental drives
underlying much of both
human and non-human
animal behavior
(Christian & Ian, 2008).
Reward systems can
shape the behavior of
employees within the
organization (Suliyanto,
2011)

22. Reward Systems
Definition
Set of mechanisms for distributing
 Tangible returns
and
 Intangible or relational returns
As part of an employment relationship

23. Reward Systems
Tangible returns
Cash compensation
Base pay
Cost-of-Living & Contingent Pay
Incentives (short- and long-term)

24. Reward Systems
Tangible returns (continued)
Benefits, such as
Income Protection
Allowances
Work/life focus

25. Reward Systems
Intangible returns
Relational returns, such as
Recognition and status
Employment security
Challenging work
Learning opportunities

26. Types of Returns in
Performance Management System

27. Types of Returns in
Performance Management System
Base Pay
Cost of Living
Adjustment
and Contingent
Pay
Short-term
Incentives
Long-term
Incentives
Income
Protection
Work/Life
Focus
Allowances
Relational
Returns

28. Purposes of PM Systems

29. Purposes of PM Systems:
Overview
Strategic
Administrative
Informational
Developmental
Organizational
maintenance
Documentational

30. Strategic Purpose
 Link individual goals with organization‟s goals
 Communicate most crucial business strategic
initiatives

31. Administrative Purpose
 Provide information for making decisions:
 i.
Salary adjustments
 ii.
Promotions
 iii.
Retention or termination
 iv.
Recognition of individual performance
 v.
Layoffs

32. Informational Purpose
Communicate to Employees:
 Expectations
 What is important
 How they are doing
 How to improve

33. Developmental Purpose
 Performance feedback/coaching
 Identification of individual strengths and
weaknesses
 Causes of performance deficiencies
 Tailor development of individual career path

34. Organizational
Maintenance Purpose
 Plan effective workforce
 Assess future training needs
 Evaluate performance at organizational level
 Evaluate effectiveness of HR interventions

35. Documentational Purpose
 Validate selection instruments
 Document administrative decisions
 Help meet legal requirements

36. Characteristics Of An
Ideal PM System

37. An Ideal PM System:
14 Characteristics
Congruent with
organizational
strategy
Meaningful
Thorough
Practical
Specific
Identifies
effective/
ineffective
performance
Reliable

38. An Ideal PM System:
14 Characteristics (continued)
Valid
Acceptable
and Fair
Inclusive
Open (No
Secrets)
Correctable
Standardized
Ethical

39. Congruent with organizational
strategy
- Consistent with organization‟s strategy
- Aligned with unit and organizational goals

40. Thorough
All employees are evaluated
All major job responsibilities are evaluated
Evaluations cover performance for entire review
period
Feedback is given on both positive and negative
performance

41. Practical
Available
Easy to use
Acceptable to decision makers
Benefits outweigh costs

42. Meaningful
Standards are important and relevant
System measures ONLY what employee can
control
Results have consequences
Evaluations occur regularly and at
appropriate times
System provides for continuing skill
development of evaluators

43. Specific
Concrete and detailed guidance to
employees
• What‟s expected
• How to meet the expectations

44. Identifies
effective and ineffective
performance
Distinguish between effective and ineffective
Behaviors
Results
Provide ability to identify employees with various
levels of performance

45. Reliable
Consistent
Free of error
Inter-rater reliability

46. Valid
- Relevant (measures what is important)
- Not deficient (doesn‟t measure unimportant
facets of job)
- Not contaminated (only measures what the
employee can control)

47. Acceptable and Fair
Perception of Distributive Justice
Work performed  Evaluation received  Reward
Perception of Procedural Justice
Fairness of procedures used to:
Determine ratings
Link ratings to rewards

48. Inclusive
Represents concerns of all
involved
When system is created, employees
should help with deciding
What should be measured
How it should be measured
Employee should provide input on
performance prior to evaluation
meeting

49. Open (No Secrets)
Frequent, ongoing evaluations and feedback
2-way communications in appraisal meeting
Clear standards, ongoing communication
Communications are factual, open, honest

50. Correctable
Recognizes that human judgment is fallible
Appeals process provided

51. Standardized
Ongoing training of managers to provide
Consistent evaluations across
People
Time

52. Ethical
Supervisor suppresses self-interest
Supervisor rates only where she has sufficient
information about the performance dimension
Supervisor respects employee privacy

53. Integration with other
Human Resources
and Development
Activities

54. PM provides information for:

55. Issues on Performance
Management System
Counterproductive work behavior
(CWB) has been defined as “volitional acts that
harm or intend to harm organizations and their
stakeholders (for example, clients, co-workers,
customers, and supervisors)” (Atwater & Elkins,
2009).

56. 1. Abuse against Others
Types of CWB
Incivility
Workplace Aggression/Violence
Sexual Harassment
2. Production Deviance
Passive Production Deviance
Sabotage and Theft
Withdrawal

57. Dealing with Counterproductive
Work Behavior
1. Non - Punitive Approaches
Alignment
Corrective Feedback
2. Self - Management Training for Improving Job Performance
3. Punishment
4. Termination

58. Punishment
1. Determine whether there are legal issues that should be taken into
account.
2. Consider only work - related factors.
3. Apply policies and decision - making rules consistently.
4. Allow employees a voice in the discipline process.
5. Make the punishment consistent with the severity of the offense.
6. Communicate clear performance expectations.
7. Provide employees with sufficient time to improve their performance or
change their behavior.