Page 9 - DMGT517_PERFORMANCE_MANAGEMENT_SYSTEM

Performance Management System

Notes The Performance Management Cycle

Performance management is a process, not an event. It operates as a continuous cycle, as shown
in Figure 1.1.
Figure 1.1: The Performance Management Cycle

plan
review

monitor
act

1.2 Concept of Performance Management

The concept of performance management may be categorized into two separate types of
management. The first one deals with the performance of an organization as a whole and evaluates

the effectiveness of its managers. The second one deals with the system of evaluating employees
in order to enable them to achieve reasonable goals and thus ensure that the organization
performs better.

Figure 1.2: Linkage of Performance Management with other Sub-systems
Human resource Recruitment and Industrial relations
planning selection • Improving working
• Data on job-person • Basis for determining relations
fitment criteria selection criteria • Joint goal setting
• Matching for • Quality candidates results in improved
organizational results in perfor- performance
effectiveness mance improvement

Performance Performance
Annual stock taking
management management audit

Training and Reward Management Mentoring and counseling
development • Identification of • Developing leadership
• Basis for training talents skills
needs identification • Effective career and • Employee empower-
• Aids in performance succession planning ment
improvement • Compensation • Work life balance
• Competency management • Internalization of ethics
management policy

It is pertinent here to understand what performance is. Brumbrach (1988) defi nes ‘performance’
both as behavior and results. Behavior emanates from the performer and transforms performance
from abstraction to action. Not just the instruments for results, behaviors are also outcomes
in their own right—the products of mental and physical effort applied to task and can be

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