Performance Management Process

Many times, people confuse performance management with one element of the performance management process: performance appraisal. Performance management is much more than a once or twice a year event. It is a critical process that aligns individual goals and performance with the strategic goals of the organization. In some organizations, performance management is part of an overall talent management or human capital management program, which is the process that organizations use to both attract and retain skilled employees. In many organizations performance management and talent management are synonymous. Regardless of whether it is viewed as an element of a larger process or is the overarching process, an organizations performance management plan needs to also be designed to develop and retain talent for the organization.

Recognition is the fifth component of a comprehensive performance management plan.

This part of the performance management plan needs to determine the methods used to reward and recognize performance. These methods may include monetary and non-monetary rewards. In many organizations, the performance management plan is connected to the employee compensation. How that connection is structured can vary depending on the goals of the company. As that connection is being designed, we need to keep in mind that typically employees will focus on what is rewarded. In some organizations, rather than helping to achieve the organizations goals, the compensation plan is structured in a way that is counter to achieving the goals. Although we are a society that stresses the monetary side of the work transaction, money doesn't motivate every employee action. Employees have many different motivations for their behaviors; some desire the opportunity to contribute; others work for promotions; and still others work to achieve their full potential. So, we also need to reward in ways other than giving monetary rewards. Knowing what motivates your employees will assist you in rewarding them in meaningful ways. Sometimes that reward will be a simple thank you. Involving employees in the planning of the performance management process is an effective way to determine what rewards will motivate your employees.

How does this part of the Performance Management Process operate within your workplace or an organization that you are familiar with?