Performance management is a critical part of the day-to-day administration of any business. As companies compete for survival on reduced budgets, they are increasingly aware of the need to drive performance, increase efficiency and develop new ways to inspire and motivate their work force.

To be totally effective, a performance management system needs to be well structured, properly monitored, coordinated with HR, and offer a fair and consistent approach that does not prejudice individual creativity. It will need to work in conjunction with the strategic objectives of the organisation and managers will need adequate training to effectively implement the process.

The essence of effective performance management is based on good communication at all levels and specific training needs to be given to those that are fulfilling this role within the organisation. It is no good saying that every manager can implement this role because just because they are a manager — it doesn't work like that.

The scope of performance management must be clearly outlined so that employees do not regard performance management as a threat but rather as an opportunity for them to develop their skills within the organisation — to the benefit of both.

Constructive process

Managers should be careful not use the process as a tool by which to intimidate employees, but as a constructive process to offer constructive support for improvement and to develop latent talent. It is a win-win process for both management and employees, when implemented correctly.

However, dealing with poor performance can fill some managers with anxiety and they may feel inclined to ignore it due to lack of confidence and/or training, and, in some cases, a fear that their own performance may also be challenged.

An underperforming individual may blame his/her manager and their lack of planning and dissemination of critical information. Handling situations such as this often requires the intervention of a third party and hence the need for HR to coordinate and efficiently monitor the process.

Here's what to do to achieve results:

• Identify areas for improvement and set achievable targets

• Agree on time frames and review dates

• Offer adequate support and training with open communication

• Keep accurate documentation

• Be clear, open and honest in regard to the agenda

Help and support from the organisation for underperforming employees is as critical as the review process itself. Where there are skills issues, training is essential. Where there is interpersonal conflict, then counselling, coaching and mediation will be needed.

However, "doing nothing" is certainly not an option.

Appraisals: Ensuring clarity

About performance management:

  • Ensure that your performance management system is well structured.
  • Train your managers to conduct performance reviews.
  • Ensure adequate resources to manage the overall process.

- The author is a BBC guest broadcaster and motivational speaker. She is CEO of an international stress management and employee wellbeing consultancy based in London. Contact them for proven stress strategies -