To start the topic of performance management, we must first define its mains studied concepts. According to readings on the particular theme of Bendassolli's work, performance management arises from a behavioral construct of many facets involving the task completion as well as attitudes and other organizational situations. Keeping with the conceptualization offered by Bendassolli, within the performance management, we must differentiate the concepts of efficiency, result and performance.
Emphasizing the idea of performance being a behavioral construct, involving attitudes and the work of the employees, it might also be related to skills and postures and individual might have.
The concept of efficiency is linked to the idea of a predetermined assessment of the performance of a particular individual or institution. The evaluative question itself generates a range of questions, about gradations or definitions of fair and effective evaluation parameters of people, positions, careers and their functions. Another point of great difficulty is the definition of the evaluator, which may result in the unilateral evaluations of collaborators from the part of evaluators in situations of power, or might result in biased and unfounded self-evaluations from part of the collaborators. A good recommendation would be making an evaluation with more than one form of perception. About the concept of result, this is the end “result” of the work performed. In many organizations, the outcome of an activity becomes the key indicator of performance, yet such organizations forego questions about clear job and task definitions, blind themselves to crucial questions about staff development and longterm organizational plan compliance.
Having said these concepts, one of the main focuses addressed in people management, is the importance of people in organizations. Performance management, taking up what was explained in the previous paragraph, is directly related to a company's strategic planning and employee development. As a rule, an organization recognizing its required competencies will be able to better define positions and outline a development plan to achieve its objectives.
As Chiavenato (1999) and Oliveira (2004) affirm, human resources are the most important resource of every organization. Therefore, every member most contribute to achieving the organization's goals. Considering this, it is believed that performance management ends up being every member of the organization's responsibility.
The costs of doing performance management can vary a lot. While doing it in select periods of time may seem to result in a lower cost in the short term, authors affirm that, by being a continuous process, performance management results in lower costs if done as a continuous process. That way, it comes as something natural, and it must be seen as an investment, rather than and expense.
When talking about performance evaluation, there are eight types and tools. These can sometimes be complementary, but not necessarily. They are:
• Self evaluation
• Team evaluating
• The chart grading
• 360º evaluation
• Forced choice
• Goals and results
• Leader evaluation
• Competence assessment
The former one is the most common and is related to the competences which each job requires, and measuring them using the concepts of Knowledge, Abilities and Attitudes, in order to create a profile based on those competences for the job. When done in a low quality or careless manner, performance management may result in several negative consequences for the organization, such as:
• Increased abandoning by employees.
• Utilizing of unreal information about employees performance.
• Low self-esteem by feedback.
• Wasted resources.
• Damaged relationships between coworkers and/or employers.
• Lack of motivation to keep performance.
• Job dissatisfaction and employee rage.
• Increased risk of litigation.
• Unfair and unjustified demands on employees and managers resources.
• Unfair standards and ratings.
• Biases based on personal values and relationships..
• Confused and unclear rating systems.
On the other hand, performance management can bring very positive consequences if done in a good manner, for examples:
• Motivation for future performance increases when feedback about the previous one is received.
• Having his work recognized by the feedback is most likely to raise an employee's self esteem.
• Supervisors in charge of the appraisal are able to gain new insights into the person being appraised.
• The understanding of the concepts surrounding the job and tasks are clarified.
• Those who take part in the system develop a bigger understanding of themselves.
• Actions taken by the administrative part of the company are taken as more fair and appropriate.
• The organization makes their goals clearer.
• It makes employees more competent and with an increased performance.
• It minimizes the employees misconducts.
• There is a better lawsuit protection.
• The good and poor performers are well differentiated.
• Supervisors are able to communicate their view of the performance more clearly.
• The changes in the organization are facilitated.
• There is more motivation, commitment and intentions for the employees to stay in the organization.
• It gives employees an active voice.