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Home » MBA Articles » MBA - HR Articles » Performance Management in Human Resources

Performance Management in Human Resources

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history of management in
India can be traced to the English East India Company,
(16001874) chartered by Queen Elizabeth I for trade with Asia.  After
independence in 1947, India subscribed to a model which placed a strong
emphasis on central planning
and a big role for government owned Public Sector
Enterprises (PSEs) who were established to control the "commanding
heights" of the economy.  After the economic reforms of 1991 the
country's economy became much more
integrated to the world economy, which were the effects
of liberalization in our country and globalization worldwide. The
concept of human resources has undergone drastic changes as far as the
Indian Industry is concerned. The
age-old concept of Human Resource Management has changed
to Human Resource Development. This change has come as a result of the
change in industry from manufacturing in the public sector to
information technology in the private

Performance Management in Human Resources.

evolution of the concept of performance management as a new Human
Resource Management model reflects a change of emphasis in organizations

away from command-and-control toward a facilitation
model of leadership. This change has been accompanied by recognition of
the importance to the employee and the institution of relating work
performance to the strategic or
long-term and overarching mission of the organization as
a whole. The performance management process provides an opportunity for
the employee and performance manager to discuss development goals and
jointly create a plan for
achieving those goals. Development plans should
contribute to organizational goals and the professional growth of the
employee. Critical to the success of this new model, a flexible attitude
in the face of constant change is most
essential. For performance managers, this changing
many new challenges and opportunities. Performance managers and their
employees are
increasingly being asked to become generalists who step
outside of traditional narrowly-defined job descriptions in support of
team objectives and goals. These changes are resulting in the
development of new approaches to human
resource management.

Job Description

Writing a job description is a process of systematically
collecting, analyzing, and documenting the important facts about a job.
A strategic plan is composed of a mission statement, identified goals
related to the organization's mission, as well as
strategic initiatives necessary to accomplish each goal. Assignment of
responsibility for the accomplishment of goals and strategic initiatives
is related to the
essential functions of the job description. Before a job
vacancy is advertised, a job description is completed. After the
employee is hired, this job description becomes the job assignment and
forms the
basis of the job function description on the Performance
Evaluation Form. Writing a job description is a process of
systematically collecting, analyzing, and documenting the important
facts about a job. This
process is called job analysis. The job description
provides a basis for job-related selection procedures and performance

The job description specifies:

  • the specific job functions and tasks

  • the functions and tasks which are essential

  • the percentage of time typically spent performing each function

  • the skills, knowledge and abilities required to perform the job successfully

  • the physical and mental requirements of the position

  • special conditions of employment

  • the level of supervision received and exercised.

The performance manager should share the job description with the employee during his or her first few days on the job.

Standards of Performance

Standards of performance are written statements
describing how well a job should be performed. Performance standards are
developed collaboratively with employees, whenever possible, and
to new employees during the first month on the job. The
performance standard provides a benchmark against which to evaluate work

Standards of performance are usually:

  • Developed in collaboration with the employees who do the tasks or functions
  • Explained to new employees within the first month on the job.

Observation and Feedback

Observing work
performance and providing feedback should be a routine part of the
performance management process. Feedback should be based on observed
and/or verifiable work-related behaviors,
actions, statements, and results. This type of feedback
is called behavioral feedback. Effective feedback helps the employee
sustain good performance, to develop new skills and to improve
performance whenever necessary.  Observing employee
performance and offering feedback about what you see should be a routine
part of the way you manage employee performance. Feedback is most
effective in reinforcing or improving work performance
when the employee has confidence in the basis of that feedback. And you,
as the performance manager, will be more confident when giving feedback

based on information that you can support. From the
standpoint of performance management, observation involves noticing
specific facts, events, or behaviors related to work performance and the

results of work performance. Observations are the raw
data upon which effective performance feedback may be based. The purpose
of observing employee behavior and the results of work performance is
identify and describe it in order to help the employee
be successful and continue to develop his or her skills, knowledge, and
experience. Observations should be the basis for feedback, and may also
actions, which might be taken to support, develop or
improve performance.

Performance Appraisal

appraisal is a process of summarizing, assessing and developing the
work performance of
an employee. In order to be effective and constructive,
the performance manager should make every effort to obtain as much
objective information about the employee's performance as possible. The
traditional performance appraisal systems are Ranking,
Person to person comparison, Grading, Graphic Scales, Checklists, Forced
choice description and Essay.

The most modern and the widely used is the 360-degree approach.

With the increased focus on teamwork, employee
development, and customer service, the emphasis has shifted to employee
feedback from the full circle of sources depicted in the diagram below.
multiple-input approach to performance feedback is
"360-degree assessment" to
connote that full circle.  The major sources from whom
to get the inputs for the 360-degree approach are superiors,
subordinates, peers internal customer,
customer and a self-evaluation. The organizational culture and mission
must be considered, and the purpose of feedback will differ with each
source. For example, subordinate assessments of a
supervisor's performance can provide valuable developmental guidance,
peer feedback can be the heart of excellence in teamwork, and customer
service feedback focuses on the quality of the team's



Evaluations by superiors are the most traditional source
of employee feedback. This form of evaluation includes both the ratings
of individuals by supervisors on elements in an employee's performance
and the evaluation of programs and teams by senior


form of performance information is actually quite common but usually
used only as an informal part
of the supervisor-employee appraisal feedback session.
Supervisors frequently open the discussion with: "How do you feel you
have performed?" In a somewhat more formal approach, supervisors ask
employees to identify the key accomplishments they feel
best represent their performance in critical and non-critical
performance elements.  In a 360-degree approach, if self-ratings are
going to be
included, structured forms and formal procedures are


downsizing and reduced hierarchies in organizations, as well as the
increasing use of teams and
group accountability, peers are often the most relevant
evaluators of their colleagues' performance. Peers have a unique
perspective on a co-worker's job performance and employees are generally
receptive to the concept of rating each other. Peer
ratings can be used when the employee's expertise is known or the
performance and results can be observed. There are both significant
contributions and
serious pitfalls that must be carefully considered
before including this type of feedback in a multifaceted appraisal


An upward-appraisal process or feedback survey
(sometimes referred to as a SAM, for "Subordinates Appraising Managers"
is among the most significant and yet controversial features of a "full
performance evaluation program. Both managers being
appraised and their own superiors agree that subordinates have a unique,
often essential, perspective. The subordinate ratings provide
valuable data on performance elements concerning
managerial and supervisory behaviors. However, there is usually great
reluctance, even fear, concerning implementation of this rating

Performance Development Plan

employee performance furthers the mission of the organization and
enhances the overall quality of the workforce within the Organisation by
promoting a climate of continuous learning and
professional growth; helping to sustain employee
performance at a level which meets or exceeds expectations; enhancing
job- or career-related skills, knowledge and experience; enabling
employees to
keep abreast of changes in their fields; promoting
affirmative action objectives; and motivating employees. Performance
development plans may be considered at each stage of the performance
management process.

An important component of the performance management
process is development of employees' work-related skills, knowledge and
experience. The development process offers another opportunity for
you and your employee to work collaboratively to improve
or build on his or her performance and to contribute to organizational

Continuous Learning

Development of employee skills, knowledge and experience
is essential in today's rapidly changing workplace. In order for the
organization to remain competitive and to retain its reputation for
excellence, employees should have up-to-the-minute
information and the ability to use new technologies, adapt to
organizational change, work in flatter organizations in which
skills and knowledge are required, and work effectively
in teams and other collaborative situations. Employees, too, recognize
that it is essential for them to continue to learn so that they will be
in their current jobs and able to move into other
positions or accept new responsibilities as circumstances demand.

Preparing the Plan

There are four principal occasions when preparation of a
performance development plan might be considered: 1) after definition
or review of performance standards, 2) as a part of the ongoing process
of observation and feedback, 3) as the final element of
the performance appraisal process, 4) when an employee initiates a
request for education or development opportunities. At any of these
points in the
performance management process, you may discuss
training, education or development opportunities with your employee.
Identify the specific steps to be taken and document a strategy for
these objectives. That documentation should include:

  • A description of the specific steps to be taken

  • The names of those who will assist the employee

  • End dates for the completion of the plan's objectives

  • A statement of how successful completion of the plan's objectives will be appraised.

Performance management and Organisational Development

personnel are subjected to individually oriented training and
development programs, the personnel
performed well in the work environment. But this did not
always mean that it impacted the general organizational functioning in
any way.

Organisational Development was born in order that the
organization's culture also gets impacted. Organisational development
can be defined as a complex educational strategy intended to change the
beliefs, attitudes, values and structure of
organizations so that they can better adapt to new technologies, markets
and challenges, and the rate of change itself .The output from
management can be used as an input to Organisational
Development. Continuous and Continual improvement can also
be used in improving the Quality of Human resources in any scenario.
both are complementary they are not exactly the same,
while continuous improvement gives a time frame for checks and
improvement. Continual improvement means checking after each process. To

become a firm using continual improvement, the
organisation should be a learning organisation.

BPO industry and Performance management

The BPO industry with its major thrust on knowledge
workers offers a challenge to the Human Resource manager. The major
challenges are :

  • Brand equity: People still consider BPO to be "low brow", thus making it difficult to attract the best talent.

  • Standard pre-job training: Again, due
    to the wide variety of the jobs, lack of general clarity on skill sets,
    etc, there is no standard curriculum, which could be designed and

  • Benchmarks: There are hardly any
    benchmarks for compensation and benefits, performance or HR policies.
    Everyone is charting his or her own course.

In both the pre-job training as well as in benchmarks, the role performance management plays
is not too small. Performance appraisals whether they be pre/post
training, offers the company a quick glance
through the effectiveness and the worthiness of a person
in the organisation and also helps in effective placements.

Key To success in BPO Human Resources

The key to success in ramping up talent in a BPO
environment is a rapid training module and also in post appraisal
training. The training component has to be seen as an important
sub-process, requiring constant re-engineering.


appraisals have become a tool of much importance in today's management
scenario. This
could be used best only with the help of objective and
fair HR practices. The outputs of which could be used for Organisation
development rather than for mere employee efficiency improvement. Casual
subjective appraisals will not be able to stand the test
of fairness and legality if challenged. Firms are thus being forced to
emphasize a participative but joint management by objectives followed by a
participative, joint-periodic appraisal, to bring more clarity into the system.


1. Personal Management, Edwin B Filippo, Fifth Edition ; Mc Graw Hill Publications
2. Organisational Behaviour ;Fred Luthans ; Ninth Edition ; Mc Graw Hill
3. http://www-hr.ucsd.edu/~staffeducation/guide/

4. Performance Management Practitioner Series ; United States Office of Personal management
5. http://www.opm.gov/

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