Performance Management System Analysis: Bright Ideas Company Report

This report analyzes the performance management system implemented at Bright Ideas Company Limited, a retail company based in Trinidad and Tobago. The essay evaluates the company's approach to performance management, highlighting its strengths and weaknesses. The report focuses on the use of a 360-degree feedback system, detailing the process and its advantages, such as improved relationships and team building, and disadvantages, including potential for bias and unreliable results. Recommendations are provided to improve the system, such as ensuring alignment with company objectives and proper training for employees. The report emphasizes the importance of a robust performance management system for employee development and organizational success, offering insights into how Bright Ideas Company Limited can enhance its current practices.

Running head: PERFORMANCE MANAGEMENT SYSTEM
PERFORMANCE MANAGEMENT SYSTEM
Name of the Student
Name of the University
Author Note

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Introduction
In this essay, the main aim of the discussion will be to evaluate the performance
management systems of Bright Ideas Company Limited, where the strengths and the
weaknesses of the performance management system will be identified and recommendations
will be provided in order to improve the system in the organization. Bright Ideas Company
Limited is a retail company from Trinidad and Tobago which is privately owned. It used to
sell lighting fixtures and household items. The age of the company is 12 years and it has its
presence in 7 locations throughout the country. The number of employees who are working in
the company are 200. Bright Ideas Company Limited is part of a group company and thus, it
is included to focus on the aim jointly. The human resource department of the group of
companies has focused to accomplish from the performance management system of the
organization, to make it clear of what is anticipated from the employees, identify the
improving as well as training needs for continuous growth of the employees working in the
group of companies, to possess a fair reward system, have a presence of career improvement
and generally convincing about the return on investment in the investment of human capital
of the organization.
Performance Management System
Performance management system can be termed as the formal and systematic
approaches to evaluate and, measure the performance of the employees of the organizations.
It is a process or way through which the companies coordinate the mission, goals and
objectives of the companies with the available resources like manpower and material and
systems in order to set the priorities of the companies. In other words, it is a system for
integration or unification of the management of the performances of the employees as well as
the business entities. Performance management system is a continuous system between the

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employees and the management about agreement of the activities to be performed, the way or
process through which it will be measured within a fixed amount of time, with a focus to
achieve the goal set by the companies at both the employee and organizational level. The
strengths and weaknesses of the employees in context of job can be identified and evaluation
can be done basis on the identified factors. It also includes measurement, recording and
development of the workers of the organizations. The system of performance management
also supplies the opportunity for the companies to evaluate and take inventory of its human
resources. It also helps in providing the information so that vital decisions can be taken and
feedback can be provided for further improvement of the employees. It gives the management
the scope for holding proper communication with the employees, on order to clarify the
chances and to take part in the improvement of every employee of the companies. From the
point of view of the employer, it gives the opportunity or scope to discuss the performances
with the employees and career goals for the future perspectives. The main aim of the
performance management system is the development, involvement, communication,
assessment of the performances, identification of the training needs and providence of the
base for giving the reward to the employees of Bright Ideas Company Limited. There is
involvement of six formal meetings in the performance management system of the
organizations, with each meetings possessing a particular goal or aim. The steps are (Aguinis
2009):
 System inauguration
 Self-appraisal
 Classical Performance Review
 Merit or salary Review
 Developmental Plan
 Objective Setting

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Performance evaluations in Bright Ideas Company Limited are done on annual basis and
key performance indicators that are regulated with each work description of the workers are
used as instructions in their appraisals. For example, the performance of an employee from
the marketing department was evaluated according to the targets given to him and the
performance evaluation have done on the basis of that. The human resource department of the
company has focused to evaluate the performance management system of the organization, to
make it clear of what is anticipated from that employee, point out the developing as well as
training needs for continuous growth along with the targets given by the company to him, to
possess a fair reward system, have a presence of career development and usually convincing
about the return on investment in the human capital investment of the organization. A 360
approach is used in to evaluate his performance where self-appraisal, peer appraisal and
management appraisal is done. The full participation of both the employee and human
resource management are required in the process (DeNisi and Smith 2014).
Feedback is given after that to that employee where discussions includes required
training, improvement and development needs and any other guidance which are necessary
for the improvement of basic performance of that employee in Bright Ideas Company
Limited. The reward and recognition system of the organization depends on performance
ratings of the employees and can either be public recognition or monetary, token of
appreciation. At present, the company is improving its potential appraisal attitude of the
performance management system, which was performed on a team division scale in the past
but heading towards promotion of that employee to senior level within the team which ranges
from restaurant, bakery and supermarket divisions. The human resource department focuses
with its fresh system or approach with its potential appraisal system is to minimize the
turnover as well as to motivate the career improvement in order to strengthen management

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succession programme of Bright Ideas Company Limited (Decramer, Smolders and
Vanderstraeten 2013).
The 360-degree performance system is the system in which the employees of the
organization of Bright Ideas Company Limited get unknown or confidential feedback from
the other employees, peers and managers. This approach includes the managers of the
employees, peers and direct reports. It is also known as the multi-rater feedback, multi-source
assessment or multi source feedback. The self-evaluation by that employee is also included in
this approach. It is the feedback that comes indirectly or directly from the subordinates,
employees, supervisors and peers unlike other methods of performance appraisals. This
method of appraisal has become more famous over the years as the companies has accepted
that multiple outlooks can have an essential or crucial effect of the improvement of all the
employees of Bright Ideas Company Limited. At present, almost 90% of the companies under
Fortune 500 list uses a version of a 360-degree appraisal.
The advantages of this approach of performance management system includes
development of the positive relationships as well as trust among the employees their peers
and managers, job satisfaction and team building. It helps to promote the trusting
relationships among all the people who are included in this approach or method of
performance appraisal. Working together on the appraisals in order to promote team building
where all the employees of the organization are accountable for helping each other and
accomplishing execution of high-quality of roles and responsibilities. This type of evaluation
helps to provide enough data in order to complete the appraisal of executives. The
performances of the executives are dependent on the success or failure of the organization
like Bright Ideas Company Limited. It also helps to create long-term employee loyalty among
the employees of the company.

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The disadvantages of this system of performance management includes back-scratching
scenarios, backfiring use of obscurity and consistent interpretation of objectives and criteria.
The culture of the organization has an impact in the success or failure of this approach. If the
collaboration and the team building is not promoted properly by the company, it will create
damage to the company, which is actually hampering Bright Ideas Company Limited. If the
participants provide false information about the performance of the workers and the
managers, the obscurity of the feedback can see a major setback. Biasness and stereotype
nature hampers the conduction of the evaluations of the employees of the organization. In
both the cases, the results of the performances of the employees are unreliable as well as
invalid. This proves to be a major problem at the time of promotions of compensation and
career paths based on the evaluation (Buckingham and Goodall 2015).
Recommendations
Bright Ideas Company Limited need to take the help of the right precautionary
measures in order to determine the success of utilization of 360-degree approach of
performance management system. Commitment to the system can aid to reduce the
disadvantages of using this system. The human resource management need to evaluate the
performance of that employee of the company with the outlined objectives of the company
(Campion, Campion and Campion 2015). If the performance evaluation of that employee
does not measure the abilities that are consistent with the mission and goals of Bright Ideas
Company Limited, then the appraisal will not be effective. Development of valid and reliable
assessment is very much important to the success of the performance management system
used by the company. The managers also need to spend adequate time needed to train that
employee proper on the process of the 360-degree evaluation and the correct interpretation of
the performances of that employee of the company. The participating auditor must be chosen

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by a human resource representative from outside in order to decrease the back scratching in
the process (Bracken and Church 2013).
Conclusion
From the above discussed essay, it can be said that the performance management
system forms an integral part of Bright Ideas Company Limited and it should be used
effectively and efficiently in order to measure the performances of the employees, so that a
healthy organizational and work culture is maintained within the company.

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