Supporting Good Practice in Performance and Reward Management

Activity 1:

  • Purpose of Performance Management and its Relationship to Business Objectives

According to ACAS (2017), organisation management primary role in evaluating the attainment of their existing goals through implementing strategic performance review with active facilitation of entire organisation operations. To attain all the set objectives, performance management objectives include the following;

  • Improving the Employee Competency Levels: Performance management identifies specific issues that hinder attainment of already set goals. In our organisation, this is directly associated with the training programs which are aligned to set business targets intended to boost workforce competencies and skills.
  • Making organisational decisions: This is an undertaking that is implemented after a successful management performance evaluation. In our organisation, the decisions made include a partnership with stakeholders in industry of operations and adherence to already set policies and regulations in the banking sector.
  • Promoting Industrial Relations: A detailed alignment of an entity already set targets, and operations include the primary determinant of an entity’s success. In our organisation, the management ensures that they foster a progressive relationship with the industrial groups for mitigating any likely disagreements that hinder achievement of set goals and objectives.
    • Components of Performance Management Systems

The distinct components of performance management are intended to establish prevailing challenges hindering entity attainment of already set objectives and to establish reliable strategies to mitigate them. The performance management components include;

  • Performance Planning: This is a component that is inclusive of all set goals and objectives deduced in detail. The process is further integrated with their strategic plan to attain entity goals and objectives.
  • Performance Appraisal Evaluation through Meetings: This is a common factor guiding the process of creating an acknowledgment on organisation performance. In our organisation, it is a common tradition always to implement quarterly appraisals that target all their departments in the organisation management.
  • Coaching and Diagnosing: This is an aspect implemented to ensure there is leverage on active sourcing of data through setting realistic criteria of goals and objectives. This is similarly a section of the desire to possess a successful training curriculum for motivating an organisation staff.
    • Relationship between Motivation and Performance Management

Performance management is a significant determinant of the level of employee motivation. As pointed out by CIPD (2017c), despite the performance management being a critical factor for the employee’s motivation, there still exist limitations on the extent of motivation. In this regard, the factors that influence the motivation level in performance management include;

  • The setting of realistic and Achievable Organisational Goals: This is an aspect guiding the evaluation of organisation progress in line with already set goals. In some instances, the set goals could be demotivating to an entity staff, the achievement of an achievable and realistic objectives promote worker’s motivation level. This is in line with the Herzberg-Two factor theory that identifies the motivating factors that contribute to improved job satisfaction with hygiene factors contributing to dissatisfaction (Stello, 2011). Achievement of these set goals in an entity is grouped as the motivating factors.
  • Performance Appraisal: The employees in an organisation are actively motivated based on the performance appraisal levels in an organisation. Specifically, the monetary appraisal system is perceived as an efficient strategy to appreciate relevant badges and certificates. This is in line with the Herzberg’s five factors on job satisfaction grouped in the salary and group of recognition.
  • The setting of realistic and achievable organisational goals: The motivation source in this factor is informed by the capacity of evaluating an entity set goals. This is in line with the Maslow-hierarchy of needs theory (Jerome, 2013). This theory informs that satisfied requirements are linked to an increased motivation level leading to an increased struggle for meeting all needs.
    • Purposes of Reward within a Performance Management System

Rewards are identified as the performance appraisal factors that are primarily in a direct relationship with other identified factors including motivation. This is in line with ACAS (2005) recognizing that the pay reward system in a performance appraisal is appropriately used in harnessing retaining and motivation of employees hence improving performances. The reward purposes include;

  • Enhancing Workers Motivation: In this component of performance management, the rewards are provided for implementing high motivation of their workers. The ideal form of reward system is noted to include monetary recognition through offering certificates and badges. Hence, the monetary and promotion rewards in a performance system are critical in making contributions to the motivation of an employee (CIPD, 2017b).
  • Improving Employee Competence. An instrumental role in performance management is oriented on harnessing the level of commitment of employees while uniquely enhancing the achievement of high-level competencies. This is harnessed by the desire to integrate distinct rewards in performance management for promotion of fair competition with all involved employees with an aspiration to attain projected rewards in process of review.

3.1 Components of Total Reward System with one being Non-financial

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