Performance management: key points PM aims: encourage, support, sustain high performance of individual, team and organisation Is strategic and emphasises vertical and horizontal integration of HRM Should be flexible and continuous process – not one-off event AMO theory helpful in explaining how to manage individual performance Is line manager owned and driven Unlocking Human Resource Management Chapter 7

Performance management: cycle – key points At operational level performance management can be seen as a continuous process or cycle with sequential activities These activities typically include: Induction Observing and monitoring Performance appraisal Identifying training and development needs Reward and recognition Counselling and support Unlocking Human Resource Management Chapter 7

Performance management: appraisal – key points Focuses on reviewing past performance, assessing future objectives and development needs Most common form: downward appraisal conducted by line manager Other types: self-appraisal, upward appraisal, peer appraisal, customer appraisal and 360-degree appraisal Appraisals can be problematic: prone to bias, time consuming, bureaucratic, difficulties in linking with pay Unlocking Human Resource Management Chapter 7

Performance management: measuring – key points There are two broad approaches to performance measurement: objective-based and competency-based assessment Measurements should be valid, meaningful and fair. The SMART acronym is often used to describe the key requirements of good target setting Performance ratings are often used to grade and rank employees’ performance Unlocking Human Resource Management Chapter 7

Performance management: underperformance – key points Performance management provides the opportunity to identify and address underperformance Formal action includes training, learning and development, counselling and support, adjusting work duties and redeployment Disciplinary procedures should only be used when performance has not improved over a period of time Unlocking Human Resource Management Chapter 7

Performance management: key roles – key points Line managers should own and deliver PM at operational level Line managers need support to overcome problems of lack of skills and experience, work overload, lack of time, subjectivity HR managers have role to play in designing policies and supporting line managers Senior managers also play key role in setting culture and being positive role models Unlocking Human Resource Management Chapter 7

Unlocking Human Resource Management Chapter 7 Learning summary By the end of this chapter you should know: Meaning and importance of PM Role and different types of appraisal Different methods of measuring Approaches (formal and informal) to managing underperformers Potential problems in operationalising PM Critical role of line managers Role of HR and senior managers Unlocking Human Resource Management Chapter 7