2.11 Performance Management Strategies

Question 1

Define “Performance Management”

Answer 1

Focusing on improving business and individual performance by relating business performance objectives to individual employee performance objectives

Question 2

List all the Performance management strategies

Answer 2

MAEE
1. Management by objectives
2. Appraisal
3. Employee self-evaluation
4. Employee observation

Question 3

Explain “Management by objectives” as a Performance Management Strategy

Answer 3

A process by which management and employees agree on a set of goals for each employee, with these goals contributing to the business objectives

Question 4

List all the steps of the process of “Management by objectives”

Answer 4

BIRPP
1. Business objectives are clearly defined
2. Individual employee goals are negotiated
3. Regular monitoring of progress
4. Performance feedback
5. Performance appraisal on achievement of goals

Question 5

2 advantages of “Management by objectives as a Performance Management Strategy

Answer 5

1. Can highlight areas that employees need training in
2. If employees are more involved in goal setting they become more invested and motivated to fulfil their goal

Question 6

2 disadvantages of “Management by objectives” as a Performance Management Strategy

Answer 6

1. Time-consuming
2. Failure to meet objectives could be demoralising

Question 7

Explain “Appraisal” as a Performance Management Strategy

Answer 7

The formal assessment of how efficiently and effectively an employee is performing their role in the business

• Typically occurs at frequent intervals, e.g every 12 months, 6 months or every quarter

Question 8

What are the 3 methods of appraisal

Answer 8

1. Essay: When the manager keeps a journal on each employee
2. Critical incident: Only noting down exceptionally good or bad aspects of the employees’ work
3. Comparison: Employees are ranked according to their performance criteria (1-5)

Question 9

2 advantages of “Appraisal” as a Performance Management Strategy

Answer 9

1. Information can assist managers in making decisions regarding pay increases or promotion
2. Facilitates communication and positive relationships between management and employees

Question 10

2 disadvantages of “Appraisal” as a Performance Management Strategy

Answer 10

1. Time-consuming
2. Staff who meet or exceed standards may expect a promotion which can be expensive for a business

Question 11

Explain “Employee self-evaluation” as a Performance Management Strategy

Answer 11

A process whereby employees carry out self-assessment, based on a set of agreed criteria

Examples of questions:
- What are my strengths?
- What are my weaknesses?
- Where could I improve?

Question 12

2 advantages of “Employee self-evaluation” as a Performance Management Strategy

Answer 12

1. Can highlight the need for training and allow employees to request access to training
2. Allow employees to be actively involved in the process of performance management and assist them in understand their role in the business

Question 13

2 disadvantages of “Employee self-evaluation” as a Performance Management Strategy

Answer 13

1. Employees can overstate their performance
2. Management may need to take some responsibility for monitoring performance

Question 14

Explain “Employee observation” as a Performance Management Strategy

Answer 14

A strategy where a variety of opinions on the performance of employees is sought to arrive at a more comprehensive picture of past and current performance

Question 15

2 advantages of “Employee observation” as a Performance Management Strategy

Answer 15

1. A broad range of opinions can provide a comprehensive picture of performance
2. Employees may be more likely to respond to feedback if they value the opinions of their peers

Question 16

2 disadvantages of “Employee observation” as a Performance Management Strategy

Answer 16

1. Staff stress can increase due to the observation
2. Process could be damaging if any one of the participants has a personal vendetta against the employee