A Continuous Process
The management of corporate performance involves having senior managers derive and execute strategic plans, communicate them throughout the organisation and transform them into reality.
Based on a study conducted by the Economist Intelligence Unit which studied and analyzed performance management in 170 European and US companies. It found that there were four specific requirements to deliver world-class performance management. They are : Measures and targets, Process, People, and Information management.
Measure and targets
Measures are the key performance indicator (KPIs) while target is the desired performance. It requires that your KPIs linked to the business strategy, well cascaded and integrated, balanced between the perspectives, realistic, and achievable.
KPIs must be process-driven because:
Processes drive the inputs required and produce the outputs.
Our goal is to minimize the inputs and maximize the outputs.
We do this through our processes.
We usually control the processes directly, not the inputs nor the outputs.
It becomes very important to measure the processes, not just costs and results.
Performance Management is a continuous process for establishing targets, identifying performance barriers, planning to overcome barriers, monitoring progress and performance indicators, evaluate performance, rewards- sanctions.
Successful performance management does not have an employee in continuous improvement is key.end point. Rather, as illustrated in the diagram, maintenance and upkeep are required to keep the process running well and to ensure that performance management efforts remain consistent with shifting organizational priorities and needs. Once your performance management system is working, finding a way to engage
Performance management is actually about creating a work environment in which people are enabled to perform their best. A systematic way for organizations to involves its members, as individuals and members of a group, in ensuring that goals are consistently being met in an effective and efficient manner. It is the main vehicle by which managers communicate what is required from employees and give feedback on how well they are achieving job goals.
Performance monitoring required us to get the numbers and provide us with how well organization achieving their goals. All major business processes require infrastructure to support their operations; information technology can play an important role in supporting the performance management processes; the issues that need to be considered are how the performance-management information systems are integrated throughout the organisation, how the information is displayed, and the extent to which the systems are real-time.
Figure : Performance Management Cycle