The Performance Management Cycle starts with setting up the performance standard for meeting the expected goals follows with monitoring and observing the existing performance of the employee, identifies the problems or shortfalls or training needs going further designing training program as per the needs, coaching and training employees to improve the performance of the employee to achieve the business goals.
Performance Management Cycle designed to work towards enhancement of skill and performance of the employee and also adds the reward and recognition to increase job satisfaction and bring competitiveness. It should also allow to revisit and review organizational set goals and targets as per the performance and remodel or amend these goals as per the employees performance or as per the business market needs and moves.
The properly planned performance management cycle helps the employee to align their goals with organizational goals, understand their objectives and construct a roadmap to achieve the objectives.
The performance management cycle is four step procedures which includes :
1) Planning
2) Monitoring
3) Reviewing
4) Rewarding
Here are these steps are being detailed :
1. Planning:
This is the first step of performance management cycle which is termed as groundwork required for future success. It consists of planning the business strategy, assigning specific objectives to teams and employees, goal development, setting the targets, defining the standard actions and behaviors expected from the employees to achieve the set targets.
This crucial information is then transferred to the employee to make them aware about the strategic plan of the year. This is a collaborative process in which employee understands the importance of the task assigned to them and their overall expected contribution to the success of the organization.
It is important that management should verify that employees have required knowledge and skills in order to achieve the set objectives. In cases where the employees does not have the required skills or knowledge, the management roll on an employee development plan. Here the areas in which training is required are identified and the training programs are developed to strengthen the skills of employees.
2. Monitoring:
On quarterly basis the management meets with the employees to check in on the progress of the work. The employees are offered the help which is required, assistance is provided to solve work related problems and some adjustment regarding goals is done based on the situation in order to keep the performance plan on track.
This step is also used to understand the ground reality of the goal achievement and to verify that all the employee has understand their responsibilities. The step is crucial to make sure that employee goals are align with the organizational objectives. Here the required action can be taken to help employee achieve the set target in the given time period.
3. Reviewing:
In the reviewing process the employee and management evaluate the final result of the yearly work done by the employee. It is the evaluation about the standard performance expected from the employee and the actual performance of the employee during the financial year. The management and employee together review if the goals were accomplished. What are experience and skills employee gained during the process, how well the tasks were completed by the employee, is there any other way to ensure the goal attainment, anything the management or employee can improve to make the goal accomplishment more easier. Such types of aspects are discussed during the review meeting.
4. Rewarding:
Reward is the final stage of performance management cycle. It is the vital step to keep the employee motivated throughout the year. When employee receives the deserved rewards it improves their performance and commitment towards the organization. Management has to work hard to fairly reward the employee and recognizes their efforts in the goal achievement. The reward should be designed based on the merit and performance of the employee. The traditional rewards include bonus, increase in compensation, vacation time, assigning important projects, acknowledgment, a positive review and promotion.
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