Performance Management Theory

Table of Content

This article is a conceptual paper that looks into the construct of performance management and challenged and discussed it along two lines: to what degree does theoretical support for performance management exist as it is applied in organizations; and from the performer’s standpoint, how performance management might be improved. The succeeding sections of this paper will show some relevant motivation theories by exploring their strength of connections to applied performance management system. Lastly, the implications for HRD will be presented. Brief Summary of the Article

The concept of performance management has gained strong attention to improve results in the midst of challenging economic conditions. Many organizations instead of waiting for external improvements such as market growth and technological advances, they looked into their internal capabilities for performance and productivity gains. Performance management has been defined as management’s systematic application of processes aimed at optimizing performance in an organization (Warren, 1982). There is an emphasis on process that somewhat carries a negative connotation in the performer’s perspective – something done to people.

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While a more progressive definition was given by Weiss and Hartle (1997): ‘A process for establishing a shared understanding about what is to be achieved, and how it is to be achieved, and an approach to managing people that increases the probability of achieving success’ (p. 3), this definition continues to represent a top-down orientation. Performers and their immediate supervisors tend to think performance management is in compliance of something that is required or forced. Likewise, employees do not look at it as helpful or valued element of their job (Coens and Jenkins, 2000).

Traditionally, performance management is viewed to be the responsibility of immediate supervisor (e. g. , Barnes-Farrell, 2001; Cardy and Dobbins, 1994; Latham and Wexley, 1994). However, with the presence of different organizational challenges such decentralized workforces, enlarged spans of control, lack of direct experience, evolving performer expectations, etc. , caused supervisors not to be effective managers of others’ performance. In addition, the tendency of managers never having held one or more of the positions that report to them.

Without the expertise, knowledge, and understanding that come with having performed the work, the credibility of feedback is suspect (Coens and Jenkins, 2000). Finally, many of the modern employees now expect to be more involved in determining the performance management that affects them (Mohrman et al. , 1989). Moreover, with the sizeable investment of many organizations for performance management it does not appear that there is a clear evidence of theoretical research supporting organizations manages performance.

Despite the availability of relevant and advance models especially work motivation; performance management is described in process terms (e. g. Grote, 1996; Swan, 1991) wherein it starts from objective setting, through formal appraisal, to the start of the next cycle. There may well be theories applied to this but clear connections are weak and average managers would have hard time to grasp such a theoretical support. There is a vast array of relevant motivational theories that can be utilized in the improvement of performance management.

However, managers are apt to the more traditional and sometimes to those theories that have patently weak connections to the distinctiveness of an organization, like the Maslow’s hierarchy of needs. Among the modern motivation theories worthy of consideration are: Expectancy Theory (Guest, 1997), Justice Theory (Latham et. al, 2005), Self-Determination Theory (Ryan and Deci, 2000). Donovan (2001) identified Equity Theory, Expectancy Theory, Cognitive Evaluation Theory, Goal Setting Theory, Control Theory, and Social Cognitive Theory as those that have received the most attention recently.

For the purpose of this study, the writer selected three among the theories and explores its application to performance management: Goal-Setting Theory, Control Theory and Social Cognitive Theory (See Table 1. ) Table 1. Three Motivation Theories and Performance Management Goal-Setting Theory| Control Theory| Social Cognitive Theory| Found to be exceptionally reliable, valid, and useful across diverse work situations (Locke et al. , 1981). Difficult and specific goals led to higher performance when compared to vague do-your-best goals (Locke and Latham, 2002). Also referred to as feedback control or cybernetics. It is described in self-regulation terms as an ongoing comparative process aimed at reducing the discrepancy standards for behavior and the observed effects of actual behavior (Carver and Scheier, 1981, 1998). | Motivation is influenced by interaction of three elements: work environment itself, what the performer thinks, and what the performer does (Bandura, 1986). Strong performance requires positive self-beliefs of efficacy in addition to appropriate skills and abilities. The descriptions of the above-mentioned theories are enough to show how much motivation theories offer insight and explanation of how performance management works. Goal-setting theory is relevant to the questions raised in Human Performance System such as, “do performance standard exist? ” In the same way, control theory provides a solid foundation for critically assessing the feedback elements of performance management approaches. And lastly, social cognitive theory provides explanations in support of performance management.

The interaction of the three factors provides a strong systems view of performance. Self-efficacy places emphasis on what performer’s think of themselves, as they set or react to goals, monitor and judge their performance, and correct behaviors using self-regulation mechanisms (Bandura, 1986). Lastly, the same theories mentioned above were considered to look into the performer’s perspective. Table 2 shows the relation of the three motivational theories to performance management. Table 2. Performer’s Perspective to Performance Management Goal-Setting Theory| Control

Theory| Social Cognitive Theory| It makes a solid case for the use of difficult and specific goals to create the strong situations necessary for substantial achievement (Locke and Latham, 2002). They pointed out that performer’s participation heightens the importance of the goal, thereby strengthening goal commitment. | Most performance management does not emphasize feedback (Coen and Jenkins, 2000). Performers taking charge of their own feedback loops helps them obtain the timely feedback they need to make the negative discrepancy adjustments indicated by this theory. People who see themselves as highly capable of performers tend to embrace difficult goals with above average (Bandura, 1994). Specifically, strong self-efficacy translates to higher level of goal challenge, effort expended in pursuit of established goals, perseverance and resilience. | Significance/Implications for HRD Professionals Performance management is the means by which an organization ensures that their employees understand how they can contribute to the organizational strategic goals.

It focuses on the effective management of people in line with the organizational goals and objectives to enhance performance. And, guarantees the creation of a working environment that will allow and enable people to perform their duties and responsibilities to the best of their abilities. However, findings of this article are quite surprising because despite the positive contributions of performance management in the organization, it seems that it is not effectively implemented.

In addition, the availability of relevant theories that have substantial scholarly history and much accumulated evidence of their value are not fully integrated in the performance management process. Many organizations cling to the most common theories instead of applying concepts that is more fitted to the circumstances of their organization. This is a clear loss to organizations; an unacceptable loss that is just because of missing the opportunity in maximizing available and applicable theories to support performance management system.

Along with the less integration of pertinent and significant theoretical works to support construct of performance management, this article have seen the possibility of having alternate forms of performance management. This came out because of the observation that there is no tight feedback system and the role of self-efficacy in support of higher goal achievement was noted. Simply put, the performer’s perspective to performance management warrants a serious attention in the organization – the possibility of self-directed performance management.

This article left HRD managers challenging and important things to consider in appreciating what performance management wants to achieve. Besides the above-mentioned gap between the theory in-use and practice and the introduction of self-directed performance management, the following are equally important implications to look into: a. A careful study and understanding of organizational performance management system. This will be vital in the identification of appropriate theoretical base that will support the construct of performance management.

Likewise, it will give a clear picture whether or not there is a strong theoretical support for the system; b. Performance management system must be working in consonance with the organizational culture. Such culture will be the basis of relevant theories to be applied; c. Motivation is an indispensable aspect of performance management and is contributory to the creation of a high performing organization. Various available motivational theories such as, Goal-Setting, Control, Social Cognition, Self-determination, Feedback Intervention, and Self-Management Theories deserve HRD’s serious attention.

These are all theoretical works closely related to performance management that can give a strong theoretical support to it. d. The idea of self-directed performance management opened the door to a more cost-saving and motivated employees. HRD managers have to crucially consider this by taking into account the circumstances of its organization. The organization and the employees may accept or decline this idea. Hence, HRD manager was left with the challenge of helping both the organizations and employees better understand their performance management systems and the performer’s perspective.

Recommendations The article has given vast array of information that described different flaws in the performance management and gave a clearer picture of the importance of relevant theoretical support in the system. It further emphasize that performance management is all about increasing performance – employees and organizational performance. However, despite of organizational continuous development of performance management, there are still more to be done. With the teachings from this article, successful use of performance management system should include the following: 1.

The conduct of a cautious study regarding the existing performance management system and the identification of a relevant and strong theoretical support. The organization, HRD manager and/or the person in-charge in the monitoring of the performance of the employees must be able to describe and define the existing performance management system. Meaning, they must understand the system and knows how it actually work in the organization. In particular, it can be done through a performance management system review.

This review must be attended by the Head of the organization, HRD manager, Manager(s) in-charge of the employee’s performance, and a representative from the employees. They should discuss in here the status of organizational and employees performance, assessment of the existing performance system and the possible actions to be taken in order to improve it. A committee-type of reviewing or assessing of a current state of performance management system is an effective way to encourage the development a collective approach of solving problems.

It is in a way removing the organizational thinking of top-down approach of management that tends to be more imposing rather than encouraging. After the careful assessment of the performance management, the logical thing to do must be the identification of a strong and appropriate theoretical support. It must be clear that what we want to integrate are motivational theories that will encourage employees reach a high performance. Such a theoretical base must be in congruent with the circumstances of the organization, or to simply put, the culture of the organization.

The article has enumerated various motivational theories that are substantial scholarly works and are closely related to the performance management such as, Goal-Setting Theory (Lock & Latham, 1990), Control Theory (Carver and Scheier, 1998), Social Cognition Theory (Donovan, 2001), Self-determination Theory (Deci & Ryan, 1985), Feedback Intervention Theory (Kluger & DeNisi, 1996), and Self-Management Theory (Manz & Sims, 1980; Manz, 1986). The integration of a well-founded and valid theory in the performance management system will result surely to the attainment of a highly performing organization. . The organization must ensure the creation of an open and active ‘communicating organization. ’ Communication is very important in whatever aspect of life. Like in an organization, communication is considered to be a key element to manage performance of employees. It is important for the employees to have regular and frequent communication to deal with different problems of the organization. We must put to note that, the absence of communication is tantamount to detaching employee from the organization, or the organization to the employee.

But, how can we have an open and active communicating organization? This will let us go back to the basics of performance management. Firstly, communicate goals and job expectations. Traditionally, goal-setting is a management function but the finding of this article looks at it to be a two-way communication of goals between the organization and individual. Simply put, the participation of the employee in goal-setting must be encouraged rather than to follow the top-down approach.

It is important that the organizational vision and goals are crafted with the employees for them to clearly understand how their works fits into the organization, and how they could contribute to the achievement of such organizational goal. Likewise, it will strengthen the commitment in the achievement of goal is higher. The article have made mention about Peter Drucker’s concept of “manager’s letter” that encourages performers to write to their boss to facilitate communication. This concept is worth exploring to stimulate goal-sharing and communication.

Lastly, the supervisor and employees understanding of the job duties will eliminate ambiguities regarding functions in the organizations. Secondly, communicate feedback. It must be a regular and frequent performance feedback process that will facilitate dialogue between the manager, supervisor and the employee. Consequently, it will foster better communication in the organization. An effective performance management system promotes regular checking of the strengths and weaknesses and allows the performer to participate in the exchange of views. By doing so, it will build performer’s confidence and elp them improve performance further. Lastly, communicating feedback must not be done once or twice a year. It must be a continuous process of performance review unlike the prevailing organizational norm of doing at the beginning and end of the rating cycle. It must be frequent and regular, which much be determined at the dispense of the manager and/or supervisor. Finally, the organization must foster a performance management system that must include manager, supervisor(s), and employees in the work planning, setting expectations, monitoring performance, developing the capacity to perform, rating and good performance must rewarded.

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Performance Management Theory. (2016, Oct 30). Retrieved from

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