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Performance management

What is performance management?

Performance management describes the arrangements that employers use to maintain, and improve the performance of their workforce so that the organisation achieves its goals. 

Most performance management arrangements involve:

  • employees being set performance measurements
  • meetings between a manager and each member of staff to discuss their performance
  • assessing employees against their performance measures
  • a record of performance being kept.

How this is done can vary widely, depending upon the particular needs of the organisation.

For help on deciding what would be appropriate for your organisation, go to How to get performance management right.

Why is managing performance important?

Good performance management is essential to get the best outcome for organisations and the workforce. If performance is not managed well, staff are unlikely to perform at their best.

Good performance management arrangements can help an organisation:

  • motivate staff
  • check that all staff are making valuable contributions towards organisational goals
  • develop staff
  • recognise and acknowledge the good work of employees
  • deliver tasks and projects quickly and to required standards
  • spot and improve poor performance.

However, it is important to keep the arrangements as simple as possible, so that managers and staff do not work around it.

How to get performance management right

Creating arrangements that best suit the needs of your organisation is clearly important. To help you achieve this, there are number of actions you, as an employer, should consider.

For more information see our guidance on How to get performance management right.

Measuring staff performance

How performance is measured and assessed can be difficult for employers to get right. Staff should be set challenging performance measurements. This might involve setting your employees objectives and/or expected behaviours. What measurements you do set staff must be fair and must not be discriminatory.

For more information see our guidance on Measuring staff performance.

Maintaining effective performance management arrangements

Once performance management arrangements are in place, it is important that they are monitored and reviewed to ensure it is meeting the needs of the organisation.

For more information see our guidance on Maintaining effective performance management arrangements.

Developing staff

The development of staff should be an on-going consideration for employers and their managers. Managers should regularly talk with their team members about what opportunities may be available and listen to what sort of development they might be interested in.

For more information see our guidance on Developing staff.

Research and case studies

pdf icon Performance management case study - Sika [132kb] - This case study details how Sika designed and implemented a new performance management system to best meet the needs of their organisation.

pdf icon 'Improvement required'? A mixed-methods study of employers’ use of Performance Management systems [1Mb] - This report looks at employers' use of PM systems in different operational contexts. The purpose of different PM systems and the values underpinning them are explored, as are their various components and the design and implementation issues being encountered. An account of emerging trends in PM system design is also presented, with some of the important challenges that organisations currently face in this area being highlighted.

Further Acas support on managing performance

Acas offers training on performance management which provides delegates with the skills and knowledge to introduce fair and effective performance management systems in the workplace.

View and book a training course near you. We can also tailor training to meet your organisation's needs and deliver it at your workplace.

For free e-learning on performance management, visit Acas Learning OnLine.

If your organisation is experiencing a specific performance management issue, our specialists can help diagnose the cause and tailor practical solutions. To find out more:

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