CASE STUDY [30 Marks] Read the below extract and answer ALL the questions that follow Effective performance management has to adhere to psychological principles Organizations like Google have changed their performance appraisal system through abandoning traditional annual performance reviews and merely focusing on engaging in conversations with employees. However, there is no empirical research evidence that these new industry trends work and experts have advised HR professionals to adhere to sound psychological principles that inform effective appraisal systems (Rotolo et al., 2018). These psychological principles include the need for feedback on performance and the ability to have voice in the process. While it is true that performance appraisal ratings do have limitations such as rater bias, there are also benefits to implementing or improving a performance appraisal system that relies on ratings (Adler et al., 2015). Proponents for performance appraisal believe that it is too easy to give up the progress that has been made (Adler et al., 2015). Performance management systems enhance organizational effectiveness by aligning individual, team and strategic goals An effective performance management system ensures that there is a continuous process of performance enhancement through setting individual and team goals that are aligned with the strategic goals of the organization. This involves reviewing and assessing performance and ensuring the training and development of knowledge, skills, and abilities (Kozlowski, 2012). Effective performance management requires year-round conversations with employees There are several indices that denote an effective performance management system (CEBMA, 2016). First, it is important to have year-round conversations with employees rather than a single annual performance review. When managers actively engage in conversations, this prepares the employees for performance feedback and they are more likely to accept the feedback that they receive because they have discussed their continuous progress with their manager. Employees' reaction to feedback is important for performance improvements One of the most important elements of effective performance review is that employees accept and react positively to feedback, especially when the feedback includes constructive criticism (Murphy & Cleveland, 1995). It is not the performance feedback per se that is important but employees reactions to the feedback. Consequently, an effective performance management system includes an annual performance evaluation, along with ongoing discussion with employees to help strengthen relationships between management and employees (CEBMA, 2016). Having more than one rater is important for an effective performance management system The second feature of an effective performance management system is the use of more than one rater within the system (CEMBA, 2016). Inclusion of an external reviewer to assess performance tends to motivate employees to do well mainly because assigned goals are more effective than self-assigned goals (Harkins & Lowe, 2000). Based on principles of procedural justice, it is important to provide employees with feedback because people have an intrinsic need to know how their employer views them and their performance. Incorporating a feedback system into performance appraisal also allows for employee autonomy and control because employees can voice their opinion and respond to feedback. This ensures that conversations between managers and subordinates are a two-way path and this is important in the development and training of employees when developing targets (Colquitt et al., 2001). It also fosters a speak-up culture in your organization which has a positive impact on organizational performance.

QUESTION 2 (10 Marks) There are various contributing factors which improve the effectiveness and efficiency of performance management within an organisation. With reference to the case study, explore any four factors which determine the success of effective performance management. Please give an answer that is clear I will add onto it for 10 Marks