Supporting Good Practice in Performance and Reward Management

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Performance management is the process of creating a work environment in which people are enabled to perform to the best of their abilities. Performance management begins when a job is defined and it ends when an employee leaves the organisation. Performance management in organisations is used to achieve the following: • Drive Results

• Build Capabilities

Drive Results
The performance management process drives the achievement and improvement of key business results through individual, group, and enterprise goal alignment. It is important to define goals and expectations which are clearly focused on key priorities, and well connected to the drivers of results. Formal and informal processes are used for identifying and communicating performance expectations and goals and ensuring alignment across the organisation. Group performance goals and measures are developed at several levels in the organisation. This ensures the organisation is focused towards achieving its set goals. Build Capability

The performance management process within an organisation helps to build capability by ensuring employees understand what they need to learn and how they need to learn it. Employees are expected to be in a constant growth and learning mode, demonstrating organisation and role-specific competencies. These bundles of skills, behaviours and knowledge are critical to the organisation’s ability to execute its business strategy.

A Performance management system includes the following components:

Job Expectations & Goals

Every department in an organisation usually has different expectations for its employees based on the requirements for the positions in the department. When goals and expectations are clearly defined, employees have the greatest opportunity to advance in the company

Timely Reviews & Feedback

Performance management systems do not benefit a company unless a timely employee review and feedback system is implemented in the program. These review sessions will inform employees how well they are performing in their position and what areas need to be corrected or improved.

Performance Rewards

Employees are best motivated by the thought of earning rewards for their actions, whether financial rewards or another form of benefit. An employee's performance review is usually linked with his financial bonus or pay raise; this ensures that the company gets the best performance out of each employee.

Motivators are more concerned with the actual job itself. For instance how interesting the work is and how much opportunity it gives for extra responsibility, recognition and promotion. For example a worker will only turn up to work if a business has provided a reasonable level of pay and safe working conditions but these factors will not make him work harder at his job once he is there. Frederick Herzberg (1923-2000) believed that businesses should motivate employees by adopting a democratic approach to management and by improving the nature and content of the actual job through certain methods hence improving performance. These methods include: • Job Enlargement workers being given a greater variety of tasks to perform (not necessarily more challenging) which should make the work more interesting. • Job enrichment - involves workers being given a wider range of more complex, interesting and challenging tasks surrounding a complete unit of work. This should give a greater sense of achievement. • Empowerment means delegating more power to employees to make their own decisions over areas of their working life. Abraham Maslow (1908 – 1970) on the other hand, put forward a theory that there are five levels of human needs which employees need to have fulfilled at work. All of the needs are structured into a hierarchy which he called the hierarchy of needs. Only once a lower level of need has been fully met, would a worker be motivated by the opportunity of having the next need up in the...
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