In every organisation, it is very essential to have a proper and effective human resource management (HRM) to enhance the functional aspects of the company in order to maximise their profitability and gain competitive advantage. The HR professional strategise management models and approaches to upgrade the performances of the employees and attain the various objectives of the organisation. It further focuses on managing the different issues that the organisation face in dealing with the employees, hiring talented and skilled individuals, maintaining their safety and wellness, motivating them through training them and ensuring growth and innovation within the organisations (Buller and McEvoy, 2016). This essay will consist of the comparison of the different types of models of performance management and analyse their advantages and disadvantages. It will further discuss the performance management practices within Google that is best suitable for their organisational environment. Various tools, techniques and methodologies will be discussed in order to help the organisation meet and adapt to the different challenges it is encountering.
Performance Management Models
In recent times, with the increase in the complexities within the business operations, it is very crucial to implement strategies and approaches based on performance management to mitigate the issues and challenges that are being encountered by the business and its activities. Although, there is no single universal model that is accepted as a model of performance management (Marler and Parry, 2016).
Performance Management Cycle by Mabey
This model was being established by Mabey who prescribed the model in the form of a cycle which consists of 5 components and ensures ways in which these elements can be implemented within an organisation to give it a competitive edge (Mone et al., 2018). The elements of the performance management system are as follows:
? Objective setting
? Measuring the performance
? Performance results feedback
? System of reward that is based on the outcomes of the performance
? Amendments to objectives and activities (Korenková et al., 2019)
Figure 1. Performance Management Cycle (Source: Forbes)
The performance management cycle helps in enhancing the performance of the employees by ensuring that the organisation utilises a four-step strategy which includes planning, monitoring, reviewing and rewarding (Smith and Bititci, 2017). This cycle helped in benefitting the organisation by increasing the competitiveness, providing flexibility to the structure of the organisation and motivating the employees to improve their functional aspects in a trained and developed manner. A deep insight of the performance management cycle has been provided below.
- Planning: In this stage, the goals and objectives of the organisation are being formulated and set. This helps the organisation to formulate strategies to enhance the business operations along with establishing objectives for the personal benefit of the employees and the teams which includes setting up their goals for development, allotting specific tasks to them, allocating targets and observing their behaviours (Albrecht et al., 2015). This stage is effectively achieved with the help of SMART goals
- Monitoring: This stage is one of the key stages that help in achieving all the objectives and the goals that have been formulated during the stage of planning. A quality check along with tracking the various activities and performance parameters of the employees will give the organisation a fair idea of how strategies and activities should be carried around within the organisation (Smith and Bititci, 2017).
- Reviewing: Reviewing is the process where the management and the employees interact to see whether the goals that were being formulated are met or not. This enables the active participation of the employees and helps in building collaboration between the employees and the management (Albrecht et al., 2015). Reviewing helps the organisation to identify and evaluate various factors that have enhanced the organisational operations along with providing them a chance of opting for alternatives.
- Rewarding: This is the final stage where the employees are being provided with rewards and acknowledgement for their hard work throughout the year. This is solely to reduce employee turnover and gain employee retention (Lappalainen et al., 2019). The rewards are often being provided to the employees in the form of incentives, compensation, one-time bonus, special projects, and promotion and so on.
Implementing the performance management cycle within the organisation will enhance the output of the company along with maximising their profits ensuring that the different objectives of the company are being met and there is a concrete tracking of the performances of the individual employees (Albrecht et al., 2015). With the help of the performance management cycle, the company will be able to revisit its structural goals continuously which help them to respond quickly to the market forces that are continuously changing. The employees are largely benefitted by the performance management cycle as their performances are being optimally monitored and they receive training and development programs to improve their skills and talents to increase their efficiency and contribute to the better outcome of the organisation (Bamber et al., 2017).
There are various advantages and disadvantages of performance management cycle. The advantages of the model are that it helps in annual planning of the different activities that take place within the organisation such as hiring, training, development, practices and goal setting. It helps in documenting the performances of every employee (Al Mehrzi and Singh, 2016). It helps in clarifying the expectations of the managers and the employees within the organisation along with enhancing the operational aspects of the employees with the help of feedback procedures. This model also ensures that the employees within the organisation are motivated and encouraged in order to attain the different goals and objectives of the company thus providing the company with a competitive edge in the market (Bamber et al., 2017).
The disadvantages of performance management cycle are that it might have the chances of creating a negative impact for the employees if the data collected by the performance management system are not authentic. Therefore, it is the responsibility of the managers to keep a check on the retrieval of fair and accurate appraisal data of the employee performances (Al Mehrzi and Singh, 2016). The entire process is very time consuming and might involve the natural biases of the managers which may result in generating results with errors.
Goal Setting Theory
The goal setting theory refers to the different goals that are being set for the employees for their future growth and success. According to the pioneer of the theory, Edwin Locke, when an individual sets difficult goals and objectives for themselves, they have a higher chance of performing better within the organisation (Latham and Arshoff, 2015). On the other hand, if they set easy goals for themselves, their performance decreases. In addition to this, the goal setting theory helps the organisation formulate action plans that have been designed to provide guidance to the individuals and the employees of the organisation. It has also been found out that there is a correlation between the improved results and business of the organisation and the goal setting theory that have been implemented by the organisation. According to the theory, there are five basic principles of the theory that help individuals perform better on a day-to-day basis (Locke and Latham, 2015). These consist of clarity, challenge, commitment, feedback and complexity of the task.
Figure 2. Properties of Goal-setting Theory (Source: Academia.edu)
The goal setting theory can be used both at an individual as well as organisational level. It allows fostering continuous improvements in the performances of the individuals as well as achieving the various objectives of the organisation by improving their standards of outcome and productivity (Locke and Latham, 2019). There are various advantages and disadvantages of the theory that will be discussed below.
The goal setting theory has enhanced the various aspects such as the choice of narrowing down the different goals and objectives of the organisation along with putting in efforts to achieve the different goals with more commitment and positive working (Locke and Latham, 2015). The persistence of the individuals helps in achieving the different goals and objectives of the company by enhancing their performances. Cognition helps the employees to change and develop their behaviour in order to achieve the different goals and objectives of the organisation (Latham and Locke, 2018).
The limitation of this theory is that there are many operational factors that need to be addressed before considering the enhancement of the business goals (Neubert and Dyck, 2016). These are the process of selecting the right skill set and individuals that possess the appropriate knowledge and talent to achieve the organisational goals. It should also try and focus on the involvement of time and the incurring of the expenses (Locke and Latham, 2020).
According to the expectancy theory, the employees and the individuals tend to behave in a particular and specific way as they receive motivation by the outcomes that they have desired. The performances of the organisation are required to be in proper alignment with the objectives and the goals of the organisation in order to meet their expectations and achieve the goals in the future (Lloyd and Mertens, 2018). The motivational factors that determine the behaviour of the individual in a particular manner is termed as the expectancy. The primary objective of implementation of this theory is to monitor and track the performances of the individuals to provide them with functional gains and profitability of the organisation. It also particularly focuses on assessing the various outcomes of the training and development programs that are being provided to the employees in order to make them perform towards the achievement of the goals and objectives of the company (Barba-Sánchez and Atienza-Sahuquillo, 2017). This theory further identifies the different motivational factors that help the individuals stay focused towards attaining their personal and professional goals. This factor helps the employees to join the organisation based on the needs and goals that the organisation will fulfil. This theory also helps in interpreting and evaluating the behaviours of the individuals that are being showcased by the individuals in order to understand their contribution towards the functional goals of the company (Nimri et al., 2015).
Figure 3. Expectancy Theory (Source: Forbes)
The expectancy theory has numerous advantages over the other theories in terms of enhancing the operational aspects of the company as well as managing the performances of the employees within the organisation (Hsu et al., 2014). It helps in identifying the individuals who are self-motivated and are willing to perform towards attaining the different goals and objectives of the company. This theory also revolves around the expectations of the people and helps them act upon their expectations from the organisational behaviour. On the other hand, the organisation can effectively monitor the performances of the employees which will help them in retaining the employees and reduce employee turnover (Kiatkawsin and Han, 2017). This will enhance the organisational structure by adding value to their firm by identifying the various motivators that are both intrinsic and extrinsic in nature.
Whereas, the limitations of this theory are that it is criticised to be one of the most idealistic theories that is implemented by the organisations. The variables that exist in this theory such as the motivational factors, efforts of the employees, rewards value and so on are very difficult to measure (Baumann and Bonner, 2017). Therefore, the managers are often required to implement various other theories along with this theory in order to measure and monitor the performances of the individuals. The model makes an assumption that the individuals are very logical and rational in nature which is why in reality this model often fails to provide a suitable solution to motivate the individuals.
Performance management practices
The performance management practices within has enabled the organisation to foster innovation and improve employee efficiency to contribute to the future growth and effectiveness of the company. With the practices of performance management, the organisation will be able to focus on implementing ways in which employee retention can be done along with ensuring proper functioning and structure of the organisations (Smith and Bititci, 2017). The practices within the organisations involve a four stage involvement which ensures the various other activities and operations that are being carried out within the organisation.
- Identification of the goals of the initiatives of performance management: Having a proper set and established questions will help the organisation to implement programs and strategies to enhance the operations and the productivity of the company (Baumann and Bonner, 2017).
- It is very crucial for any organisation to define and describe the various roles and responsibilities in order to understand the exact expectations that the company has from the employees.
- It is also necessary to pair up the different goals and objectives of the company with the plan of performance which will help the individuals to visualise their path and will help them guide through achieving their goals and objectives (Kiatkawsin and Han, 2017).
- It is essential to monitor and evaluate the progress towards their targets of performances which also helps in reviewing the main areas of performance with the help of various metrics and analytical tools.
- With the help of proper training and coaching of the employees will foster growth and improve the effectiveness of the employees to achieve their functional goals and meet their personal objectives (Al Mehrzi and Singh, 2016).
- The organisation can also work upon using their guidelines in order to make it advantageous to them. Guidelines help the organisation to work on the particular policies and direct the employees towards attaining the goals and objectives of the company (Baumann and Bonner, 2017).
- It is very crucial for the organisation to build up a culture that is performance aligned. This provides the employees with a sense of shared belief, value and expectations and they can work in a peaceful and harmonious manner.
- The organisation should implement and organise cross-functional workshops in order to have a proper understanding of the various activities that are being carried out by the different departments within the organisation (Kiatkawsin and Han, 2017).
- It is also very important that the management within the organisation provides feedback in order to enhance the operational aspects of the employees and the organisation as well.
- There should be a practice of implementing a reward system for the employees so that they feel motivated and increase their effectiveness in achieving the different goals and objectives of the company (Al Mehrzi and Singh, 2016).
Performance management of Google
Google has always been on the list of those companies that have always used new, enhanced and innovative systems of performance management. This company is among the one who believes in setting the trend and their performance management solely relies on the data collection and their analysis (Al Mehrzi and Singh, 2016). The company also ensures that the managers and the employees receive proper training to enhance their skills and improve their functional aspects to contribute to the growth and success of the company. Google has further launched a program that will help in assessing the progress of their managers which enables a process where the managers will be given proper training and development who will further ensure that the employees are being properly guided and directed towards their functional goals (Bamber et al., 2017). They also have implemented a goal setting systems which have helped them in achieving the various objectives they have formulated and also enabled the reframe of their goal setting theory. They had to pair up the different goals and objectives of the company with the plan of performance which will help the individuals to visualise their path and will help them guide through achieving their goals and objectives. The organisation further monitors and evaluates the progress towards their targets of performances which also helps in reviewing the main areas of performance with the help of various metrics and analytical tools (Kiatkawsin and Han, 2017). They also organise cross-functional workshops in order to have a proper understanding of the various activities that are being carried out by the different departments within the organisation. Implementing a reward system for the employees so that they feel motivated and increase their effectiveness in achieving the different goals and objectives of the company has been one of the factors that have enhanced the functional aspects of the company (Al Mehrzi and Singh, 2016).
Based on the above essay, it can be concluded that performance management within organisations are very essential in bringing out the best possible outcome for the organisations. There is no single universal model that is accepted as a model of performance management. It can be stated that the performance management cycle helps in enhancing the performance of the employees by ensuring that the organisation utilises a four-step strategy which includes planning, monitoring, reviewing and rewarding. This cycle helped in benefitting the organisation by increasing the competitiveness, providing flexibility to the structure of the organisation and motivating the employees to improve their functional aspects in a trained and developed manner. Further, with the help of goal setting theory and expectancy theory, the practices within the organisation has further enhanced. The goal setting theory refers to the different goals that are being set for the employees for their future growth and success. The goal setting theory can be used both at an individual as well as organisational level. It allows fostering continuous improvements in the performances of the individuals as well as achieving the various objectives of the organisation by improving their standards of outcome and productivity. Whereas, the expectancy theory helps in identifying the individuals who are self-motivated and are willing to perform towards attaining the different goals and objectives of the company. This theory also revolves around the expectations of the people and helps them act upon their expectations from the organisational behaviour.
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