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• Its shared beliefs, culture or values;
• Its performance and the outcomes of the way people work;
• Its position (including internalization);
• The way it is structured and organizes its activities;
• The technology it uses.
The above literature regarding what an organisation can seek to change includes objectives and other factors such as products, values and the way the business is structured and organises its activities. Changes to any of the above factors may require that the business amend their objectives and the way they do things in order to remain competitive.
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T = Time framed – its completion should be within the time frame.
According to Mello (2011) a PMS need not be official in order to be operative. Importantly the designed PMS should be fitting with the strategic objectives. The PMS of an organisation must be in line with the strategic objectives of that particular organisation. Performance gaps that do not support the strategic objectives need to be identified and addressed to ensure that they are not barriers for an organisation to meets its strategic needs.
According to Armstrong (2001) Management by Objectives (MBO) is a technique that is used for goal setting, which demands the manager setting specifically measureable goals with one and every employee and regularly discussing the employee’s advancement in these goals.
MBO entails the following six steps:
1. Establish organisational goals
There must be a plan devised for the entire organisation, linked to the overall strategic mission and vision. Based on this strategic plan, there must be specific goals and targets for the organisation to achieve (Hellriegel et al. 2013).
2. Set and Deliberate departmental goals
Once organisational goals have been set, departmental goals need to be formulated taking into account the goals of the organisation. Departmental goals must be derived from the goals of the organisation. Managers must share the superseding goals and aspirations of the department to assure that there is integration and orientation between the organisation’s objectives and the personal objectives (Hunter 2012).
Departmental leaders should be discussing the goals of the department with all employees. This becomes a fundamental process for an organisation that wants to achieve its goals and objectives. Employees should be made aware of what the goals of the department are and what the goals for the entire organisation are (Armstrong, 2001).
3. Define expected results (set individual goals)
Individual goals are then set jointly by managers and their subordinates”. Individual goals should be linked to the departmental goals and to the goals of the organisation. It I s important
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that managers explain to employees and that that they understand exactly what is required of them (Mone & London, 2002). Employees need to be told exactly what is expected of them.
4. Performance review
Individuals’ actual performances should be compared to the targeted performance. If a performance gap is identified this needs to be corrected (Armstrong, 2001)”.
5. Provide feedback
Employees need to know how they are performing; this is a key aspect of any PMS. Feedback and goals have a complementary relationship that is to the employee’s advantage. Regular and prompt provision of feedback enhances improvements in performance (Armstrong, 2009).
Wyne (2003) suggests that a manager creating a performance definition has the task of ensuring that all persons or teams are aware of what is expected of them and at the same time are focusing on what is expected of them for an efficient performance to be realised. This author proposes that a manager can achieve this in carefully paying attention to three elements that are key:
assessments, measures and the goals. Goal positioning has an upheld trend of achievement in performance improvement in a variety of cultures and settings. Studies have shown that the specificity of performance can be directed by the use of goals (for example, proportion of fulfilled patrons), and mobilising efforts in accomplishing greater quantities of operation.
Wyne (2003) further contends that regularly, findings have shown that one improves through goal setting productivity by 10 percentage points. This study shows how important it is to set goals that are clear, specific, challenging but achievable as this enhances organisational performance. Individual’s willingness will be enhanced if they know what is expected of them and this in turn will increase their motivation and commitment to achieving the goals of the organisation.
The phase of planning of PM series does involve objectives setting for performance and teams and individuals expectations, requiring the resolution of what should be measured in assessing performance outcomes and how it should be measured (Wilton, 2011). The literature reviewed in this chapter confirms the importance of setting objectives in the process of PM; individual’s needs to be aware of what performance objectives have been developed and the measurement of their performance. Effective performance ought to be relating to goals that are strategic, focusing on desired outcomes or outputs, indicating the evidence that is in use for the
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measurement basis, while providing a feedback with sound basis. Wilton (2011) states that individual objectives can be linked either to the job itself, such as sales targets or improvements, or directly to the individual, such as developmental objectives. Objectives assist organisations in various ways as no organisation can operate successfully without having a clear picture of where it is going and how it is going to get there. According to Wilton (2011), objectives firstly guide a group or individuals in behaving in a specific manner that is considered necessary or focusing on a particular outcome linking to the performance of an organisation. Secondly, the chief way by which performance is measured is through objectives.
Thirdly, the use of suitable objectives, which have been jointly agreed upon by the manager and the employee prevents the grounds of inferior performance at the onset.