Performance Management | Meaning and Definition

What is Performance Management?

Performance management is an essential tool used to manage people in the workplace. It helps employees to identify and realize their maximum potential while assisting HR and management to make the most out of the workforce. Performance management involves systems and processes that are intended to develop an employee to perform their best at the job.


It does not aim at cranking up the overall skills, instead it focuses on enhancing those skills that facilitate them in enhancing their job performance and productivity. It is a formal and strategic process that entails the alignment of one’s goals with the goals of a group and organization. That directly implies that crucial career decisions such as promotions, bonuses, and dismissals, are all associated to some extent with the process of performance management.


Performance management can be categorized further into systematic, objective, and periodic processes. Do not confuse performance management with performance appraisal. Here, the latter concentrates on an individual while the former’s purpose involves organizational goals under its umbrella.

Performance management involves evaluating and enhancing the contribution of an employee to the organization.


To conduct performance management, HRs, and managers can resort to two approaches, namely, the behavioral approach and the result-oriented approach. In the behavioral approach, evaluation of employees is done on the basis of their efforts and behaviors.


This approach comes in handy for providing thorough feedback on the attitude and disposition of employees in the workplace. While result-oriented approach involves the evaluation of employees on various objective criteria, where quantity and quality, both are assessed.

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