CHAPTER ONE:

INTRODUCTION

1.1 Background to the Study

Performance management system is a continuous process of improving individuals, team and organizational performance. Performance management has to be the core of all organizations since it gives strategic direction and how resources are going to be distributed towards the achievement of set goals and objectives. Employee performance management system has been popular within human resource management study, involves managing employee efforts, based on measured performance outcomes. Armstrong (2004) defined performance management as a means of getting better results from the whole organization by understanding and managing within an agreed framework, performance of planned goals, standards and competence requirements. Bacal (1999) defines performance management as an ongoing communication process, undertaken in partnership, between an employee and his or her immediate supervisor that involves establishing clear expectations and understanding about: the essential job functions an employee is expected to do; how the employee’s job contributes to the goals of the organization. The emphasis of performance management systems is on continuously improving organizational performance, and this is achieved through improved individual employee performance (Macky & Johnson, 2000).

The aim of performance management system is to improve service delivery through effective and efficient application of resources. Thus, performance management should be an important step in the organization’s human resource management system and influences employee performance and then organizational performance. Performance management as a process for ensuring employees focus on their work in ways that contribute to achieving the organization’s mission is indispensable for a business organization. Moreover, it is important for employees and managers to understand that performance management and performance management systems are the key determinants of an organization’s long-term success or failure.

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