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Successive Hurdles Approach

Figure 4: Successive Hurdles Method

(Stone, 2005, p. 255)

4.4 Strategic Performance Management & Measurement

Storey and Sisson define performance management as “an interlocking set of policies and
practices which have as their focus the enhanced achievement of organizational strategic
objectives through a concentration on individual performance” (Storey & Sisson, 1993).
Performance management and performance appraisal are typically designed on a central basis
by HR function and require each line manager to appraise performance of their staff. These
measurements are done in annual basis (Torrington et al., 2005, p. 259).The evaluation of
organizational and employee performance permits the manager to check that the strategic
objectives are valid, are being successfully communicated throughout the organisation and
are being achieved. In short, performance management ensures that the jobs are designed
accurately and that eligible persons are hired, trained, rewarded and motivated to achieve the
organizations business objectives. By managing the better employee performance, the
organization gains better cash flow, productivity increases and overall better financial
performance (Mcdonald & Smith, 1995). Baron & Armstrong state that the nature of
measuring employee performance in organization will increase the effectiveness of the
organization, by improving the people performance who work in them and by developing the
capabilities of teams and individual contributors(Baron & Armstrong, 1998, pp. 38-39).
Lebas (1995) writes that the difference between performance measurement and performance

Strategic human resource management

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management, performance measurement includes measures based on the key performance

indicator (KPI) set and key success factors which includes: measures to track the past
achievements; measures of output and input, Whereas performance management involves in
issues as training, teamwork, management method, employee involvement and rewards
(Lebas, 1995, pp. 23-35). Appraising and managing performance are the critical management
responsibilities and it’s a vital part of the organizations strategic management process.
Performance appraisal system are impermanent and divorced from organisations business
strategy when comes to practices. Many companies do not link their strategic objectives with
individual employee performance criteria (haygroup, 2001; Nankervis & Leece, 1998).

Figure 5: model of Strategic performance management & measurement (Stone, 2005, p. 295)

4.4.1 Rater of Employee Performance

In most of the organizations, evaluation of employee performance is done by immediate
supervisor. In fact, performance appraisal can be done by anyone who is familiar with the job
responsibilities and performance objectives and he has to know –how to distinguish
behaviours that produce effective or ineffective performance. Consequently, immediate

Strategic human resource management