Human Resource Management – Managing Performance

Managing Performance

Managing Performance includes keeping track of how well employees are performing relative to objective such as job description and goals for a particular position. It is an integral part of Human Resource Management process.

Human Resource Management is the management of the Human Capital in the company. It is majorly concerned with the way the human resources are to be managed in the organization. Human Resource Management is involved in the basic 3 functions:

1. Recruitment
2. Employee Benefit & Compensation
3. Employee Training

But apart from this, it is the duty of the HR Management to look into the performance of the employees and check if they are able to meet the budgeted or planned standards. Thus a proper evaluation of the employee’s work is required. After evaluation of the work done by them, deviations are found and proper measures are taken to overcome them.

Therefore, the process of evaluating the performance of employees, finding the gaps and taking possible measures to correct the performance so as to achieve the organizational goals; is known as Performance Management or Managing Performance.

To manage the performance following steps are taken:

1. Preparing the goals: The planning of goals involves deciding what is to be done, how it is to be done and when it has to be done. The objectives are set and certain measures are taken while setting the objectives. The objectives should be “SMART” i.e.

1. Specific
2. Measurable
3. Attainable
4. Relevant
5. Timeliness

The goals or the objectives so set are the benchmarks of the performance. The company needs to achieve those goals.

2. Evaluate the Performance: Once the employees are done performing their tasks, the evaluation of the work so done by them should be measured, analyzed and evaluated. This involves the application of various techniques such as Management by Objective, ranking method etc. It is done to study the output of the employees. It should be done at regular intervals. It keeps a moral check on the employees and their performance can be controlled.

3. Comparison: It means the comparison of the employee’s actual performance with the planned performance. For this, proper benchmarks should be maintained and the benchmarks so formed should be practical and achievable. Comparison helps in ascertaining the lacking areas of employee and the areas requiring attention.

4. Gap Analysis: After the comparisons, a proper analysis of the gaps or deviations so found is done. It helps in checking as to where the company lacked and what its weak areas are. It is an intellectual process and requires a lot of brainstorming. It points out the weak and risk areas requiring immediate attention. This forms the basis of the further process of taking corrective measures.

5. Corrective Actions: Once the deviations are found, proper actions to manage the performance to bring it to the expected or planned level are taken. Proper training/ knowledge is given to increase his performance.

There are several models available to evaluate the performance of the employees. These methods can be categorized into two broad categories:

1. Traditional Techniques
2. Modern Techniques

Traditional Techniques:

The traditional techniques are:

1. Ranking Method: It is the simplest way of conducting the performance analysis of the employee. It involves the ranking of the employees on the basis of the quantity and quality of the work done by them. The employees are then ranked on the “Best” to “Worst” criteria or “Efficient” and “Non-Efficient” criteria.

2. Essay Method: Essay Method is a simple method conducting an employee performance appraisal. In this method the employer or the investigator writes a brief about every employee; his strengths, weaknesses, performance, potential etc. It does not require any specific method to conduct this system and is easy to use.

3. Grading Method: In this method different grades based on different criteria such as the performance of tasks, their involvement in the organization etc. There can be different grades in the organization such as best, good, bad, worst. The employees are categorized in these grades and afterward, the required measures are taken.

4. Field Review method: Field review method involves the physical review done by the HR officer or manager. In case the organization is not satisfied with the investigating officer’s report or his objectivity is questionable, in those cases this method is adopted.

5. Checklist Method: In this method, a manager needs to fill out specific questions about the employee. There are a series of questions and the employer needs to answer them using “Yes” or “No”. This gives the investigator sufficient information to form an opinion about the employee.

6. Group Appraisal: Generally, in other techniques, the employee is individually studied and his performance is analyzed. But as per the latest techniques, the groups are studied and their performance is analyzed all together an opinion is formed.

7. Confidential Report: It is one of the oldest techniques used to appraise the performance of the employees. In such a method a report is confidentially made by the immediate supervisor or first line manager of the employee about the employee’s performance; to the higher authorities. This helps in deciding whether he should be promoted or not.

Modern Techniques:

1. Management by Objective: Management by Objective is a technique where the managers discuss the objectives and goals of the business with the employees and with mutual discussion and consent decide the targets of the employees which have to be achieved by them. Thus active participation by the employees with the top level management makes it a good approach for taking decisions.

2. 360° Appraisal: A 360° Appraisal is an “All Round” analysis of the employee. In this appraisal technique, every aspect of employee’s environment is analyzed and the appraisal is taken from all the people he is connected to i.e. peer group, immediate supervisor, customer etc. His performance is analyzed on the basis of the appraisal so received.

3. Assessment Center: Assessment Centers are formed in large enterprises where evaluation of the competence of the managers is done. The entire organization’s manager’s performance is analyzed by the higher authority i.e. senior managers and the report is made.

4. Cost Accounting Method: It is the method of assessing the cost incurred by the company on the employee and the benefits the business earned from the services given by him. It helps in ascertaining whether to retain the employee or suspend him.

5. Behaviorally Anchored Rating Scales: In this method, the employees are assessed on the way they react to various situations or what their behavior is in the organization. The employees are then ranked and the evaluation is done.

Based on the above-given techniques; an employee’s performance can be analyzed and appropriate steps can be taken to improve it.

The performance analysis is not the only motive of performance appraisal. It will find the reasons for the deviations or gaps after comparison with the planned results and plan out the ways to reduce that gap.

The general methods used to close this performance gap are:

1. Motivation
2. Proper Training
3. Incentives

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