Principles of Performance Management

The principles of performance managementhave been well summarized as follows:

• it translates corporate goals into individual, team, department and divisional goals;
• it helps to clarify corporate goals;
• it is a continuous and evolutionary process, in which performance improves over time;
• it relies on consensus and co-operation rather than control or coercion;
• it creates a shared understanding of what is required to improve performance and how this will be achieved;
• it encourages self-management of individual performance;
• it requires a management style that is open and honest and encourages two-way communication between superiors and subordinates;
• it requires continuous feedback;
• feedback loops enable the experiences and knowledge gained on the job by individuals to modify corporate objectives;
• it measures and assesses all performance against jointly agreed goals;
• it should apply to all staff; and it is not primarily concerned with linking performance to financial reward.

Performance Managementis primarily concerned with performance improvement in order to achieve organizational, team and individual effectiveness. Organizations have to get the right things done successfully.

Performance Managementis concerned with employee development. Performance improvement is not achievable unless there are effective processes of continuous development. This addresses the core capabilities of the organization and the specific capabilities of individuals and teams. Performance management should really be called performance and development management.

Performance Managementis concerned with satisfying the needs and expectations of all of an organization s stakeholders owners, management, employees, customers, suppliers and the general public. In particular, employees are treated as partners in the enterprise whose interests are respected, who have a voice on matters that concern them, and whose opinions are sought and listened to.

Performance Managementshould respect the needs of individuals and teams as well as those of the organization, recognizing that they will not always coincide.

Finally, performance management is concerned with communication and involvement. It creates a climate in which a continuing dialogue between managers and the members of their teams takes place in order to define expectations and share information on the organization's mission, values and objectives. This establishes mutual understanding of what is to be achieved and a framework for managing and developing people to ensure that it will be achieved. Performance Managementcan contribute to the development of a high-involvement organization by getting teams and individuals to participate in defining their objectives and the means to achieve them.