Comprehensive HRM Report: Performance Management System Review

This report delves into the intricacies of performance management within Human Resource Management (HRM), emphasizing its critical role in organizational success. It begins by defining performance management and its significance in aligning employee efforts with company objectives. The report then details the importance of a well-structured performance management plan, highlighting its benefits in clarifying expectations, developing employee skills, and fostering effective communication. It explores the implementation of performance management programs, advocating for the use of behaviorally anchored rating scales (BARS) to improve appraisal systems and motivate employees. Key areas of focus, including individual and group performance alignment, employee appraisal, and performance improvement, are addressed. The report also outlines the importance of a robust communication plan and the necessary training for employees and leaders. It concludes by identifying potential issues and challenges, such as bias and employee resistance, and offers insights into overcoming these obstacles to ensure effective performance management. The report references several academic sources to support its findings and recommendations.

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Contents
Introduction......................................................................................................................................1
Performance Management...............................................................................................................1
Performance Management Plan.......................................................................................................1
Importance of Plan.......................................................................................................................1
Performance Management Program............................................................................................2
Addressing Areas of Performance Management.........................................................................2
Communication Plan...................................................................................................................3
Training Need..............................................................................................................................3
Issues and Challenges......................................................................................................................3
Conclusion.......................................................................................................................................4
References........................................................................................................................................5

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Introduction
The purpose of this report is to enlighten the reader about the performance management system
and its importance for the business process. The report will discuss about the performance
management plan with the help of which the business process can easily grow and initiate
success. Communication plan will help the company train the employees regarding the
performance management plan initiated in the organization. Further, more details about the
report are discussed below:
Performance Management
Performance management refers to the process that includes activities that ensure that the goals
and objectives of the company are effectively and efficiently fulfilled. The process of
performance management helps the employees to stay focused so that they can help the
organization to fulfil their objectives. The performance management system provides feedbacks
of performance outcomes to the employees that acts as guidance for the employees to lead the
right path of success (Van Dooren, Bouckaert, & Halligan, 2015). This process provides
accountability, documentation and feedback for the performance outcome to the employees. This
process helps the business to identify the gaps between the performance of the company overall
and train the employees to achieve them effectively. This process also provides various benefits
to the employees that work as a motivator for them. Using such motivation, the employees work
more effectively so as to align the expectation with the reality for the company (Chowdhary,
Pinel, Palpanas, & Chen, 2014).
Performance Management Plan
Importance of Plan
A good performance management system works with a mission to improve overall performance
of the organization by managing the performance of teams. An effective performance
management system provides various benefits to the company that are listed below:

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 This system ensures that the employees do understand the importance of their
contribution towards the goals of the organization and objectives as well. Using this type
system the organization will develop a roadmap on which the employees have to work
and grow (Buckingham, & Goodall, 2015).
 Further, this system also helps the employees to understand what is expected from them
and what they possess in the environment. Relating to them, this system also helps the
employees to develop skills and capabilities to fulfil the expectation of the company.
 This system also provides benefits to the company by creating a linkage between the
objectives and facilitating effective communication in the complete organization. This
system creates a cordial and harmonious relation between different lines to employees.
This aspect increase the properly trust of employees by communicating (Cardy, &
Leonard, 2014).
Performance Management Program
There are various ways to implement the performance management program in the business that
can help them to overcome the issues they are facing. The company should make use of
behaviourally anchored rating scale program to implement success for the business. BARS
system will help the company to eliminate the problem of inefficient appraisal system. This
system will help the management to promote the employees on the basis of the work conducted
by them in the organization. This system will motivate the employees to work effectively so that
they also get higher pay in the market (Zavadsky, & Hiadlovsky, 2014).
Addressing Areas of Performance Management
There are three key areas that the company need to focus on while initiating performance
management system in the business. The company needs to focus on aligning the individual
group performance, appraising the employees, and improving their performance as well. The
BARS performance management system will adequately appraise the employees on the basis of
their improvement made in the company. Further, this system will also provide a fair view to the
employees to look at their compensation system. Thus, it can be said that this system will fulfil
all the three requirements of the company and will help them to sustain their growth as well
(Arnaboldi, Lapsley, & Steccolini, 2015).

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Communication Plan
Communication is the basic need of change management plan of the business. Every
organization requires to implement an effective communication system in order to initiate
changes in the business. Changing the performance management system of the company will
certainly affect the interest of the employees so the organization to implement effective
communication plan so as to communicate the changes that the management is aiming to
implement. Under this system, the company should assemble all the employees together and then
top management should circulate the notice to all the employees. Further, in case of issues the
employees should then communicate their department head to address the problem (Shields, et.
al., 2015).
Training Need
The HR manager of the company should hold the responsibility to train the employees and the
department and team heads of the company. Before initiate the plan, the leaders should create a
particular format on the basis of which they should judge the employees of the company. With
the passage of time the leaders should fill the individual growth rate of the employees on the
basis of work conducted by them in the business process. Further, this will help them to promote
the employees on the basis of actual work done by them throughout the year. If the employees
escalate at the time of appraisal, the leaders can even show the proof of their growth. Thus, it can
be said that it is important for the human resource management to train the leaders accordingly
so that they can adequately follow the path and achieve the desired objectives of the company
(Shaout, & Yousif, 2014).
Issues and Challenges
There are various issues and challenges that the business need to consider with the
implementation of the performance development program that are discussed below:
The management plan should see that no amount of biasness is initiated in any department.
Biasness can eventually decrease the effectiveness of the business by highlighting only few
employees that are preferred by the department head.

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Further, the management should also aim to eliminate the resistance of employees. In order to
implement the performance development program, it is important for the business to initiate
change management program. Resistance of employees can act as a biggest barrier in the
implementation of this program in the business.
Conclusion
Thus, in the limelight of above mentioned events, the fact should be noted that the above
mentioned report highlight the performance management system that the organization should
implement in order to eliminate the issues that company is currently facing in the environment.

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References
Arnaboldi, M., Lapsley, I., & Steccolini, I. (2015). Performance management in the public
sector: The ultimate challenge. Financial Accountability & Management, 31(1), 1-22.
Buckingham, M., & Goodall, A. (2015). Reinventing performance management. Harvard
Business Review, 93(4), 40-50.
Cardy, R., & Leonard, B. (2014). Performance Management: Concepts, Skills and Exercises:
Concepts, Skills and Exercises. UK: Routledge.
Chowdhary, P. R., Pinel, F. A., Palpanas, T., & Chen, S. K. (2014). U.S. Patent No. 8,843,883.
Washington, DC: U.S. Patent and Trademark Office.
Shaout, A., & Yousif, M. K. (2014). Performance evaluation–Methods and techniques
survey. International Journal of Computer and Information Technology, 3(05), 2279-
0764.
Shields, J., Brown, M., Kaine, S., Dolle-Samuel, C., North-Samardzic, A., McLean, P., ... &
Plimmer, G. (2015). Managing employee performance & reward: Concepts, practices,
strategies. Cambridge University Press.
Van Dooren, W., Bouckaert, G., & Halligan, J. (2015). Performance management in the public
sector. UK: Routledge.
Zavadsky, J., & Hiadlovsky, V. (2014). The consistency of performance management system
based on attributes of the performance indicator: An empirical study. Quality Innovation
Prosperity, 18(1), 93-106.