In any organization, the struggle is to find the balance in how all the systems work together. If the goals are set and a strategic plan put into place the challenge is then to make sure all the systems work together to get the desired outcomes. The performance management becomes how this can take place. Performance management can create the necessary pathways in achieving the desired outcomes.

The starting point is ensuring the appraisal systems are in line with the planning systems and tied directly into the budget system, which allows compensation to fuel the appraisal system. “The problem is these systems are not hooked together in most organizations.”(Hitchcock, 1992, p. 50) Too often organizations do not fully integrate appraisal systems directly into the strategic plan and tie it directly into the necessary budget components. The appraisal system then becomes a separate entity all together and dependent upon cash flow when available.

According to Hitchcock, an integrated performance management system should have the following: Link to strategy, employee involved performance goals, measurement, reporting, feedback, planning and links the rewards to the results. When all of these items are in place, it helps the organization to achieve its strategic goals. When appraisals and development put people into the wrong roles, this will have a negative effect on outcomes. It is also important for constant feedback along the way. “Periodic performance review repays the time and the effort involved.”(Macauly & Cook, 1994, p. 3)

Some questions to ask:
Does your strategic plan have appraisal systems tied in?
Are the employees aware of the strategic plan?
Is the strategic plan measurable with clear objectives?
Do employees understand their role in obtaining the measurable outcomes?
Do the employees understand how they ultimately benefit from successful outcomes of the strategic plan?
Are employees given feedback on their performance specific to the strategic goals?

Employees need to know if they are doing what they should be, know where they are lacking and how to correct it. (Benson, 1995) This feedback allows an organization to keep its employees focused and running at their most efficient means. “Ironically, in many organizations, continued employment-still having a job- is feedback (i.e., if you are not fired, you must be doing a satisfactory job).”(Harris, 2002, p. 233.) The lack of employee appraisal planning tied to strategy and vision disconnects employees from the organization. Employees who know their role in the organization and have a clear path on obtaining success have greater connection to the organization as a whole.

Tm Geels – Mandt Faculty