Summary

Performance management systems aim at effectively engaging employees to ensure that the organisation's goals are consistently met. To achieve this it is important to have an understanding of what actually motivates each individual employee, and this is most effectively carried out on a one to one basis. Significant performance improvement becomes possible when a commitment is gained by each employee to strive for excellence. The performance management system needs to be aligned with the organisation's culture thus creating a strong sense of ownership by all parties. The development and enhancement of job skills forms a key component of performance management, and this also relates to the creation of employee development plans, coaching, training, incentives, and ongoing meaningful performance appraisals.

Roles need to be evaluated, job descriptions written, competitive pay scales understood, and competencies documented i.e. core competencies required by an organisation for business success, along with individual competencies needed by employees to effectively accomplish their work. With these factors established individual performance can be measured and adjusted as necessary to ensure the ongoing success of the organisation. Effective performance management systems are underpinned by excellent performance measurement processes which can then be used to mobilise the energy of employees to achieve strategic goals. Effective performance appraisal systems utilise the following key phases:

• Performance planning with employees regarding  what and how jobs should be done;
• Performance execution involving ongoing coaching and feedback;
• Performance assessment by management;
• Performance review involving a joint management/employee undertaking to discuss performance: strengths, weaknesses, successes, failures, and improvement needs. This process links the employee's performance with the mission and values of the organisation while seeking to positively influence day-to-day behaviour.

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