Performance Management in Human Resources


Thomas Cris Sarasam
Department of Business Administration
College of Engineering


The history of management in India can be traced to the English East India Company, (16001874) chartered by Queen Elizabeth I for trade with Asia.  After independence in 1947, India subscribed to a model which placed a strong emphasis on central planning and a big role for government owned Public Sector Enterprises (PSEs) who were established to control the "commanding heights" of the economy.  After the economic reforms of 1991 the country's economy became much more integrated to the world economy, which were the effects of liberalization in our country and globalization worldwide. The concept of human resources has undergone drastic changes as far as the Indian Industry is concerned. The age-old concept of Human Resource Management has changed to Human Resource Development. This change has come as a result of the change in industry from manufacturing in the public sector to information technology in the private sector.

Performance Management in Human Resources.

The evolution of the concept of performance management as a new Human Resource Management model reflects a change of emphasis in organizations away from command-and-control toward a facilitation model of leadership. This change has been accompanied by recognition of the importance to the employee and the institution of relating work performance to the strategic or long-term and overarching mission of the organization as a whole. The performance management process provides an opportunity for the employee and performance manager to discuss development goals and jointly create a plan for achieving those goals. Development plans should contribute to organizational goals and the professional growth of the employee. Critical to the success of this new model, a flexible attitude in the face of constant change is most essential. For performance managers, this changing environment offers many new challenges and opportunities. Performance managers and their employees are increasingly being asked to become generalists who step outside of traditional narrowly-defined job descriptions in support of team objectives and goals. These changes are resulting in the development of new approaches to human resource management.

Job Description

Writing a job description is a process of systematically collecting, analyzing, and documenting the important facts about a job. A strategic plan is composed of a mission statement, identified goals related to the organization's mission, as well as strategic initiatives necessary to accomplish each goal. Assignment of responsibility for the accomplishment of goals and strategic initiatives is related to the essential functions of the job description. Before a job vacancy is advertised, a job description is completed. After the employee is hired, this job description becomes the job assignment and forms the basis of the job function description on the Performance Evaluation Form. Writing a job description is a process of systematically collecting, analyzing, and documenting the important facts about a job. This process is called job analysis. The job description provides a basis for job-related selection procedures and performance standards.

The job description specifies:

  • the specific job functions and tasks
  • the functions and tasks which are essential
  • the percentage of time typically spent performing each function
  • the skills, knowledge and abilities required to perform the job successfully
  • the physical and mental requirements of the position
  • special conditions of employment
  • the level of supervision received and exercised.

The performance manager should share the job description with the employee during his or her first few days on the job.

Standards of Performance

Standards of performance are written statements describing how well a job should be performed. Performance standards are developed collaboratively with employees, whenever possible, and explained to new employees during the first month on the job. The performance standard provides a benchmark against which to evaluate work performance.

Standards of performance are usually:

  • Developed in collaboration with the employees who do the tasks or functions
  • Explained to new employees within the first month on the job.

Observation and Feedback

Observing work performance and providing feedback should be a routine part of the performance management process. Feedback should be based on observed and/or verifiable work-related behaviors, actions, statements, and results. This type of feedback is called behavioral feedback. Effective feedback helps the employee sustain good performance, to develop new skills and to improve performance whenever necessary.  Observing employee performance and offering feedback about what you see should be a routine part of the way you manage employee performance. Feedback is most effective in reinforcing or improving work performance when the employee has confidence in the basis of that feedback. And you, as the performance manager, will be more confident when giving feedback based on information that you can support. From the standpoint of performance management, observation involves noticing specific facts, events, or behaviors related to work performance and the results of work performance. Observations are the raw data upon which effective performance feedback may be based. The purpose of observing employee behavior and the results of work performance is to identify and describe it in order to help the employee be successful and continue to develop his or her skills, knowledge, and experience. Observations should be the basis for feedback, and may also suggest actions, which might be taken to support, develop or improve performance.

Performance Appraisal

Performance appraisal is a process of summarizing, assessing and developing the work performance of an employee. In order to be effective and constructive, the performance manager should make every effort to obtain as much objective information about the employee's performance as possible. The traditional performance appraisal systems are Ranking, Person to person comparison, Grading, Graphic Scales, Checklists, Forced choice description and Essay.

The most modern and the widely used is the 360-degree approach.

With the increased focus on teamwork, employee development, and customer service, the emphasis has shifted to employee feedback from the full circle of sources depicted in the diagram below. This multiple-input approach to performance feedback is sometimes called "360-degree assessment" to connote that full circle.  The major sources from whom to get the inputs for the 360-degree approach are superiors, subordinates, peers internal customer, external customer and a self-evaluation. The organizational culture and mission must be considered, and the purpose of feedback will differ with each source. For example, subordinate assessments of a supervisor's performance can provide valuable developmental guidance, peer feedback can be the heart of excellence in teamwork, and customer service feedback focuses on the quality of the team's results.



Evaluations by superiors are the most traditional source of employee feedback. This form of evaluation includes both the ratings of individuals by supervisors on elements in an employee's performance plan and the evaluation of programs and teams by senior managers.


This form of performance information is actually quite common but usually used only as an informal part of the supervisor-employee appraisal feedback session. Supervisors frequently open the discussion with: "How do you feel you have performed?" In a somewhat more formal approach, supervisors ask employees to identify the key accomplishments they feel best represent their performance in critical and non-critical performance elements.  In a 360-degree approach, if self-ratings are going to be included, structured forms and formal procedures are recommended.


With downsizing and reduced hierarchies in organizations, as well as the increasing use of teams and group accountability, peers are often the most relevant evaluators of their colleagues' performance. Peers have a unique perspective on a co-worker's job performance and employees are generally very receptive to the concept of rating each other. Peer ratings can be used when the employee's expertise is known or the performance and results can be observed. There are both significant contributions and serious pitfalls that must be carefully considered before including this type of feedback in a multifaceted appraisal program.


An upward-appraisal process or feedback survey (sometimes referred to as a SAM, for "Subordinates Appraising Managers") is among the most significant and yet controversial features of a "full circle" performance evaluation program. Both managers being appraised and their own superiors agree that subordinates have a unique, often essential, perspective. The subordinate ratings provide particularly valuable data on performance elements concerning managerial and supervisory behaviors. However, there is usually great reluctance, even fear, concerning implementation of this rating dimension.

Performance Development Plan

Developing employee performance furthers the mission of the organization and enhances the overall quality of the workforce within the Organisation by promoting a climate of continuous learning and professional growth; helping to sustain employee performance at a level which meets or exceeds expectations; enhancing job- or career-related skills, knowledge and experience; enabling employees to keep abreast of changes in their fields; promoting affirmative action objectives; and motivating employees. Performance development plans may be considered at each stage of the performance management process.

An important component of the performance management process is development of employees' work-related skills, knowledge and experience. The development process offers another opportunity for you and your employee to work collaboratively to improve or build on his or her performance and to contribute to organizational effectiveness.

Continuous Learning

Development of employee skills, knowledge and experience is essential in today's rapidly changing workplace. In order for the organization to remain competitive and to retain its reputation for excellence, employees should have up-to-the-minute information and the ability to use new technologies, adapt to organizational change, work in flatter organizations in which cross-functional skills and knowledge are required, and work effectively in teams and other collaborative situations. Employees, too, recognize that it is essential for them to continue to learn so that they will be effective in their current jobs and able to move into other positions or accept new responsibilities as circumstances demand.

Preparing the Plan

There are four principal occasions when preparation of a performance development plan might be considered: 1) after definition or review of performance standards, 2) as a part of the ongoing process of observation and feedback, 3) as the final element of the performance appraisal process, 4) when an employee initiates a request for education or development opportunities. At any of these points in the performance management process, you may discuss training, education or development opportunities with your employee. Identify the specific steps to be taken and document a strategy for accomplishing these objectives. That documentation should include:

  • A description of the specific steps to be taken
  • The names of those who will assist the employee
  • End dates for the completion of the plan's objectives
  • A statement of how successful completion of the plan's objectives will be appraised.

Performance management and Organisational Development

When personnel are subjected to individually oriented training and development programs, the personnel performed well in the work environment. But this did not always mean that it impacted the general organizational functioning in any way.

Organisational Development was born in order that the organization's culture also gets impacted. Organisational development can be defined as a complex educational strategy intended to change the beliefs, attitudes, values and structure of organizations so that they can better adapt to new technologies, markets and challenges, and the rate of change itself .The output from performance management can be used as an input to Organisational Development. Continuous and Continual improvement can also be used in improving the Quality of Human resources in any scenario. While both are complementary they are not exactly the same, while continuous improvement gives a time frame for checks and improvement. Continual improvement means checking after each process. To become a firm using continual improvement, the organisation should be a learning organisation.

BPO industry and Performance management

The BPO industry with its major thrust on knowledge workers offers a challenge to the Human Resource manager. The major challenges are :

  • Brand equity: People still consider BPO to be "low brow", thus making it difficult to attract the best talent.
  • Standard pre-job training: Again, due to the wide variety of the jobs, lack of general clarity on skill sets, etc, there is no standard curriculum, which could be designed and followed.
  • Benchmarks: There are hardly any benchmarks for compensation and benefits, performance or HR policies. Everyone is charting his or her own course.

In both the pre-job training as well as in benchmarks, the role performance management plays is not too small. Performance appraisals whether they be pre/post training, offers the company a quick glance through the effectiveness and the worthiness of a person in the organisation and also helps in effective placements.

Key To success in BPO Human Resources

The key to success in ramping up talent in a BPO environment is a rapid training module and also in post appraisal training. The training component has to be seen as an important sub-process, requiring constant re-engineering.


Performance appraisals have become a tool of much importance in today's management scenario. This could be used best only with the help of objective and fair HR practices. The outputs of which could be used for Organisation development rather than for mere employee efficiency improvement. Casual and subjective appraisals will not be able to stand the test of fairness and legality if challenged. Firms are thus being forced to emphasize a participative but joint management by objectives followed by a participative, joint-periodic appraisal, to bring more clarity into the system.


1. Personal Management, Edwin B Filippo, Fifth Edition ; Mc Graw Hill Publications
2. Organisational Behaviour ;Fred Luthans ; Ninth Edition ; Mc Graw Hill
4. Performance Management Practitioner Series ; United States Office of Personal management

Thomas Cris Sarasam
Department of Business Administration
College of Engineering

Source : E-mail January 27, 2005




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