Performance management system (PMS): An important performance measurement tool for modern organizations.

Abstract

Performance management system (PMS) is the heart of any “people management” process in an organization. Organizations exist to perform. If employees do not perform, organizations would not survive. If employees perform at their peak level, organizations would be competitive and productivity would increase. Performance management supports an organisation in the achievement of strategic goals and objectives. It assists managers in setting clear performance expectation goals for all employees that are aligned with the strategic goals. It provides a structure for employees to develop the skills they need to achieve the organisation’s strategic goals. The key features of PMS involve setting objectives, measurable performance criteria expected of the individual employee must be made known to him/her from the beginning of the year. There is regular day-to-day meeting as well as periodic formal feedback meetings with subordinates. An unbiased annual assessment of performance based on specific measurable targets set at the beginning of the corporate year is carried out. During these end of year assessment/appraisal face-to-face meetings, achievements and non-achievements of targets are discussed objectively. Necessary steps are then taken to either recognize performance or improve performance, enhance career development, promote, reward and compensate as deemed fit. The study shows how important PMS is to modern organizations when it comes to performance measurement. The study then concludes and recommends among other things that efforts should be made by organisations to ensure effective and efficient performance management system that would ultimately recognize employees’ efforts, improve performance, enhance career development which would go a long way to achieve organisational strategic goals and bring about competitive advantage.