Performance management relates to an organization’s ability to implement a system to evaluate and advance employee performance. Achieving peak performance requires consistency, clear objectives, and constructive employee evaluation. According to Mithas, Ramasubbu, & Sambamurthy (2011), an organization must design the performance management system based on extensive research about the organization’s mission, and then properly communicate the purpose of the system to employees, stakeholders, and decision makers. After the performing the research, the information should be used to establish the appropriate performance management specialized for the organization. In addition, an effective performance management system should align performance measures with current strategic objectives and future goals.
Organizations that establish effective performance management systems can receive recognition. Furthermore, some organizations spend valuable time and financial resources to create the appropriate system to increase organizational performance. One of the current methods used to evaluate exceptional organizational performance is the Malcolm Baldridge Awards (Fisher, 2010, p. 2). The Baldridge Awards allow organizations to highlight achievements made in performance achievements and organizational excellence. The Baldridge criteria measure an organization’s progress in customer satisfaction, financial advancement, human resources, and organizational effectiveness (Mithas, Ramasubbu, & Sambamurthy, 2011, p. 242). The use of the Baldridge criteria establishes new trends in organizational performance, and provides a prestigious award system to promote exceptional performance management.
An article in the Journal of Public Administration Research & Theory reveals that management innovation has a profound effect on organizational performance. The article shows that management innovation involves initiation, adoption, and implementation. In this article written by Walker, Damanpour, & Devece (2011), effective management innovation occurs when stakeholders (employees, clients, or customers) actually accept and use the innovation routinely (p. 369). As a result, some organizations do not experience innovation regarding performance management because the strategic objectives are not successful implemented by management.
Therefore, organizations that develop successful performance management systems must evaluate the current level of performance, and then use management innovation to establish new performance goals for the future (Walker, Damanpour, & Devece, 2011, p. 372).
One of the challenges of performance management involves the use of performance data. The federal government evaluated how to create a performance management system that safeguarded information while developing research. Recently, the subject of performance information occurred within the Obama administration when the Chief Performance Officer remarked that...