People illustration People theory

Performance management

Performance management is a management approach, which seeks to get the most out of the human resource. Typically rewards are related to performance and some form of appraisal scheme lies at the heart of this process.

There are many different types of appraisal system. Qualitative appraisal may take the form of a relatively structured interview in which the appraiser develops a report on the performance of the appraisee. Alternatively, a quantitative appraisal may be employed in which the appraiser ranks performance along a scale - excellent, good, adequate, inadequate, etc.

The appraisee will be seen at regular time intervals, and will be given feedback on job performance. The assessment of individuals will normally be against some specified performance standards, often related to a job description.

At a review meeting it is possible to establish individual objectives and targets for the subsequent time period. Individual development plans can then be created which set out how employees will work towards targets. The review meeting will also include an assessment of performance over the previous period against targets. This assessment will often be linked to rewards (e.g. an individual who has met or exceeded targets will be entitled to performance related pay.)

Appraisal also provides an excellent framework for designing training and development programmes. The review will act as a basis for establishing ways of improving performance. Learning and development goals will therefore be an integral part of this process.

Clearly, learning and development must be tied in with the reward system of the organisation, so that employees see them as both worthwhile in their own right and valued by the organisation. Appraisal should be seen by the organisation as an excellent vehicle for creating programmes for employee development.

Performance related pay - is a system of relating pay to levels of achievement of work based objectives or targets.


Supporting Documents

These downloads will help to put people theory into context using real world examples from real businesses.

Positioning the brand
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Find out how Chap Stick employed people theory to thrive in the healthcare industry by downloading our premium case study.

Entering a new market with a new product
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Discover how Experian applied people theory to prosper in the financial services industry by downloading our premium case study.

Meeting customers' needs in growth markets - online gaming
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Find out how BT employed people theory to thrive in the telecommunications industry by downloading our premium case study.

Creating the right marketing mix
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Learn how Motorola used people theory to succeed in the telecommunications industry by downloading our premium case study.

The marketing mix in the food industry
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Discover how McCain Foods used people theory to prosper in the food & drink industry by downloading our premium case study.