Employee performance management

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Effectiveness of incentives

IsabellM. (2014) describes the employee incentive program as a system ofrewarding success and effort in the workplace. Incentives can takemany forms in various companies. What matters is the value, whichmust not only be in monetary terms. Commission schemes are an exampleof incentives which can spur sales personnel to work smarter andharder since a good part of their salary depends on performancerewards. On the other hand, failure of a company to recognizeperformance through rewards can breed resentment and discord amongteams and employees. Some tasks in the firm are not easy to quantifyand thus making the implementation of an incentive programchallenging. This can be worsened in case those under the programfeel they are unfairly treated.

Well-designedincentive system can also help an organization to retain and attractemployees. Lucrative rewards, whether in the form of stock, bonusesor training are invaluable methodologies to keep top talents for along term. What has worked in most firms is making the workers feelappreciated for their tireless efforts towards the success of thecompany. On the flipside, if not properly structured, employeesusually seek greener pastures in retaliation (Isabell M. 2014).

Performancemanagement system

According to Shields J. et al. (2015), performance management systemis the process designed by a company to ensure all workers know thelevel of performance expected of them. It also entails the individualobjectives employees are supposed to achieve in order to realize theorganizational goals. Most companies use integrated and strategicperformance management system which incorporates performanceimprovement, development, and behavior management. The system createsa real partnership between managers and employees. In this process,meaningful goals are set at the beginning of the year. It ensuresthat both parties get the full understanding of what is to beachieved as well as developing a direct connection with the goals. Atthe end of a fiscal year, managers and workers meet to review whathas been done. It is a one-on-one discussion with the manager whomakes the leadership of the organization aware of how things arefaring and enquire about the resources needed to achieve the goals.

Also,the modern performance management where the manager offers specific,meaningful praise and encouragement throughout the year is importantfor the continuous motivation of employees. This is a useful way ofappreciation even though the set goals are not yet achieved. As such,annual meetings turn into a review and celebration for the employee’saccomplishment. In this new approach, people are encouraged tocollaborate in setting goals for the fiscal year, communicateregularly and foster a plan for growth and development.


Iwould provide employees with the chance to assess themselves as thiswould give them an opportune moment to identify their strengths andweaknesses. Secondly, I would get information from fellow colleaguesof the employee instead of the traditional contribution or feedbackfrom the direct supervisor. On the overall vision of the company,helping workers understand how their input ties are relevant to thisvision is vital. A reminder on the mission statement as well as thesetting objectives provides the worker with a sense of purpose intheir various tasks. Furthermore, giving chances for employeedevelopment and advancement is invaluable in their performancemanagement. Working towards improving skills gets the employee backon track in certain areas of their weaknesses (Haupt S. 2011).

Onincentives, I would implement a strategic reward approach focusing onareas of benefits, compensation, recognition, and appreciation. Thefour would be narrowed to activity performance and behavior.Acknowledging workers before their peers for a given accomplishmentor expressing gratitude for their actions make them feel valued andmotivate the rest to perfect their roles.


Shields J. et al. (2015), Managing Employee Performanceand Reward: Concepts, Practices, Strategies, Cambridge UniversityPress

Haupt S. (2011), Design, Development and Implementation of anIncentive System for Local Employees in Subsidiaries of WesternCompanies in China, diplom.de

Isabell M. (2014), Incentives and Performance: Governance ofResearch Organizations, Springer

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