Graduate School of Business

UNIVERSITI TUN ABDUL RAZAK

NAME : NUR ATIQAH BINTI ANNUAR

ASSIGNMENT 1

1) WHAT IS PERFORMANCE MANAGEMENT (PM)

A well designed and implemented performance management system will make a huge changes and
contribution to an organization. According to Aguinis (2009), a continuation of these three processes
which involved identifying, measuring and developing of the individuals and team performance where the
performance should be align with the strategic goals of the organization. This too are in line with
Armstrong and Baron (2000) study which stated that performance management involves processes that
was design to improve the overall performance which is owned and driven by the line managers.
With the implementation of a performance management, a lot of advantages can be received by the
organization. Based on Aguinis (2009), there are 16 contributions which can benefit the overall
organization which are:
1) Increase in motivation when receiving feedback and acknowledgement which will encourage
future performance
2) Increase in self-esteem when the employee feels valued thus fulfilling their inner accomplishment
3) Managers can obtain insight on subordinates where relationship and understanding will be built
between managers and employees
4) Job and criteria definition are refine therefore employees have better understanding of the job
requirement
5) Growth and self-insight are upgraded because the team will recognize the strength and weakness
thus assisting them in future career
6) A proper and just administration because of the valid information received therefore rewards and
merits will be distributed fairly
7) Clearer organization targets where employees will feel that there are important and in the loop
thus improving employees’ acceptance of a wider goal
8) Competency increases because of the employees’ performance is improved
9) Misconduct among employees will be reduced because of early intervention can prevent negative
consequences
10) Better defense from lawsuit where it can assist in regulating the compliance
11) A better separation between good and bad employees because it allows a faster recognition and
performance on daily basis
12) Clearer communication by the supervisors thus employees will received useful information on
their performance
13) Smooth in organizational changes because performance management will aid in aligning goals,
culture and objectives of the organization
14) Reduce turnover, improve commitment and encouragement because the employees will feel
satisfy with the organization direction
 15) Constructive suggestion is encouraged therefore employees can voice out and spark a
conversation with their supervisors
16) Enhance in employees’ engagement where positive attitude employees will lead to positive
support to the organization

Furthermore, a proper reward system also is a part of performance management system whereby it
will boost the employees’ productivity through economic rewards or even social rewards (Miles,
2012).

2) WHAT IS PERFORMANCE APPRAISAL (PA)

According to Cleveland et al., (1989), performance appraisal was done in the organization to assist
them in making decisions such as promotions and increase in pay based on the employees’ performance.
It is an evaluation process that happens ones or twice a year where it has clear criteria with quantities
scores. One of the tools to evaluate the employees’ performance is the Peer Rank Score(PRS) although a
direct evaluation from the Human Resource is crucial (Dokuka et al., 2019).
Another tool which can enhance the employees’ effectiveness is by applying Management by
Objectives (MBO) where it involves in creating and communicating the objectives, planning goal and
setting control points for the employees (Islami et al., 2018). Besides these two tools, organizations are
using HR analytics because of the needs to avoid biased performance information therefore can increase
the speed and quality of Human Resource decision making (Hill, 2013). This is also supported by Kiron et
al., 2012 studies which stated that with this tool, it can accurately evaluate employee performance and
the allocation of time and effort of the employees’.
Last but not least, the behaviorally anchored rating scales (BARS) where it is used to evaluate
interviewees’ performance with better accuracy and validity. Although it required some time and money,
It can actually provide distinctive interpretations by focusing attention to concrete demeanor which can
define specific job of interest (Guion, 2011),

3) WHAT ARE THE DIFFERENCES BETWEEN PERFORMANCE MANAGEMENT AND PERFORMANCE

Well, these two topics are related but they are not the same. These performance management and
performance appraisal has been seen as a key competency for strategic human resource management.
For performance management, It covers a wide variety of activities, procedures and policies in assisting
the improvement of the employees which includes feedbacks, goal settings, trainings and also the reward
system (Denisi and Murphy 2017). As supported by the study of Naquin et.al (2003), it is a never ending
processes of observing and monitoring the performance and finally receiving continuous coaching and
feedbacks to achieve the best performance of the employees. For example, performance management
can assist the employees to understand their working environment, boost their self-esteem and also
recognize their strength and weakness. It is also benefit the managers where they can distinguish among
their subordinates between good or bad performers.
On the other hand, performance appraisal is more towards to recognize the workforce skill through
a series of formal assessment and rating of individuals by their managers (Shaout and Yousif, 2014). It is
more to a reactive process rather that proactive process because supervisors usually review the
employees’ immediate pas period performance.
REFERENCES

Aguinis, H. (2009), Performance Management. Upper Saddle River, NJ: Pearson/Prentice Hall.
Armstrong, M., & Baron, A. (200), Performance management. Human resource management, 69.
Denisi, A. s., & Murphy, K. R. (2017), Performance appraisal and performance management:100
years of progress? Journal of Applied Psychology, 102(3),421.
Dokuka, S., Zaikin, I., Furman, K., Tsvetovat, M., &Furman, A. (2019). Wisdom of collaborators: a
peer-review approach to performance appraisal. arXiv preprint arXiv:1912.12861.
Guion, R. M (2011), Assessment, measurement and prediction for personnel decisions (2nd. Ed).
New York, NY: Routledge 461.
Hill, J. (2013), Using the cloud to accelerate transformation and influence change. Performance
Improvement, Vol. 52 No. 5, 19-27.
Islami, X., Mulolli, E., & Mustafa, N. (2018). Using Management by Objectives as a performance
appraisal tools for employee satisfaction. Future Business Journal, 4(1), 94-108.
Kiron, D., Shockley, R., Kruschwitz, N., Finch, G. and Haydock, M. (2012), Analytics: the widening
divide. MIT Sloan Management Review, Vol. 53 No. 2, 1-22.
Miles, J. A. (2012). Management and organization theory: A Jossey Bass reader. 9. New Jersey,
United States: John Wiley and Sons.
Naquin, C. E., & Tynan, R. O. (2003). The team halo effect: Why teams are not to blamed for their
failures. Journal of Applied Psychology, 88,332-340.
Shaout, A., & Yousif, M. K. (2014), Performance evaluation-Methods and techniques survey.
International Journal of Computer and Information Technology, 3(5),966-979.