Performance Management Cycle: Stage 1

Performance Management Cycle
Stage 1
Planning the
Performance
Needs Stage 2
Rewards
Development Supporting the
Performance
Stage 3
Stage 4
Ongoing Performance
Formal Cyclic
Review
Performance
Review
Supporting the Performance
Willingness Degree of
Ability to do & Opportunity x control over
to do
x x to do technology and
appropriate
behaviour external factors
Role of Ability in Individual Performance
Capacity
General of
mental learning
ability through Level of mastery Ability to do
(wisdom, experi- over the job
sagacity, ence contents and
intelligence (Tacit application skills
) Knowle-
dge Willingness to
do
Capacity
of
learning Individual
Academic Performance
ability through
training Opportunity to
& do
educatio
n
Degree of
(Explicit
control over
Knowle-
technology and
dge)
external factors
Is composition of constituents of ability over
job dynamic or static?
Ability = Existing level of Explicit Knowledge about

a job + Existing level of Tacit Knowledge about a
job
Is composition of constituents of ability over job
dynamic or static?
General Mental Ability
Job contents predominantly

Explicit Job contents predominantly Tacit
requiring to be learnt
Know- requiring to be learnt Know-
through doing and
ledge academically ledge
socialization
Academic Ability
GMA is likely to be highly pertinent in the
learning of every new task, because people who
have higher GMA are better able to process,
integrate, and apply new information than are
people with lower GMA.
However, GMA loses its consistent contribution in

the routinized tasks.
Explicit Knowledge constitutes the ability to do
a job proportionate to the degree to which the job
contents are required to be learnt academically
i.e. training.
In such situations, academic ability plays a
decisive role.
However, regarding manual and semi-skilled
jobs that are learned predominantly through-
doing or socialization, Tacit Knowledge rather
than Explicit Knowledge is the prime source of
ability.
In such cases, academic ability is not supposed to
be contributing to higher performance.
In managerial jobs, however, all components of
the ability do matter though with various
proportions in various situations.
Willingness roadmap in the
organizations
Psychological Intended
Compliance
Contract results
Non-compliance Compliance
Legitimate
Authority
Compliance
Non-compliance
Use of rewards, Non-compliance

threat, and
manipulation
Modify
relationships
Psychological Contract
Psychological contract is defined as the beliefs
individuals hold regarding the terms and conditions of
the exchange agreement between themselves and their
organisations in which the expectations and
obligations of both parties involved need to be taken
into consideration.
It is unspoken agreement between employee and
employer that goes beyond the formal employment
contract.
This takes the employees’ ideas about what they

expect from the organisation and what they feel they
owe to the organisation in return.
As a result, the psychological contract may be more
influential than the formal contract in affecting how
employees behave from day to day.
Since all possible aspects of the employment

relationship cannot be addressed in a formal,
written contract, the psychological contract fills the
gaps in the relationship.
Thus, function of the psychological contract is
reduction of uncertainty and invoking intrinsic
impetus of the employees in carrying out the
organizational business.
Boundaries of Psychological Contract
Working in odd
hours and on
weekends
Public Boundary of
Psychological Job
Contract Description
Working Real Boundary of

overtime Psychological
Contract
Promoting Willingness to perform through
reward
Reward Evaluating Evaluating
Motive offered worth of the the
incentive resources
available
Contentment Success
Process Action taken

starts again
Modification Failure
in behavior/
technique/
resources
Withdrawal
Fear Power
This is the power to force someone to do
something against their will.
Demonstrations of harm are often used to

illustrate what will happen if compliance is not
gained.
Promoting Willingness to perform through
Threat & Fear
Evaluating Evaluating
Motive Threat gravity of the resources
posed threat available to
cope with the
threat
Temporary relief No penalty but Adequate
but more fear & no reward performance
dependence
Process Action taken

continues
Resentment/
-ive attitude/ Inadequate
Penalty
more fear & performance
dependence
Demerits of Management by fear
 The rule of fear itself is counter-productive. It

makes the employees paralyzed and inclined
towards the state of omission.
 Fear breeds resistance, subterfuge and even

dishonesty. Fudging of the data to avoid any
foreboding is a common instance of reaction to the
rule of fear.
 Under such situation, the officials find ways of
"beating the system", that is, to act just to the
extent of neutralizing the threat and avoiding
the pain and discomfort.
 Once adopted, such approach requires a
continuous use of fear for compliance; a bigger
dose of fear is needed once people become
accustomed to previous one – that has a grave
potential of marring the superior-subordinate
relationship.
Demerits of punishment
 It results in undesirable emotional side effects like

anxiety and aggressive feelings toward punishing
agent and ultimately leads to passivity and
withdrawal.
 Punishment has ripple effects and its impact goes

into the environment enveloping it into pal of gloom
regardless to its degree of justification.
 It breeds feelings of unfairness and inequity
because most of the time penalty is not for rule
breaking rather for being caught for rule breaking.
 Above all, who says that punished behavior will

be replaced with the desired behavior? An
employee punished for late coming may become
punctual but not necessarily productive one.
 Impact of punishment is momentary. The stopped

behavior may reemerge once threat of punishment
is over.
Merits of punishment
 If the punishment is justified it makes the
organization stronger.
 It has therapeutic impact. It can prevent the rule-

abiding employees from succumbing to temptation.
 Potential harm of remaining silent and doing

nothing when something wrong has been
committed by someone is greater than the
punishment itself as it may cause unhealthy feeling
of impunity among the members.
Referent Power
Influence over others, acquired from being well
liked and respected by them.
It is the power of charisma and fame and is wielded

by celebrities as well as more local social leaders.
Those with referent power can also use it for

coercion – all it takes is a single word from a social
leader for us to be shunned by others in the group.
Opportunity to Perform
Opportunity is a kind of enabling or constraining force that
is beyond the employee’s control
Following are some of the factors that constitute
opportunity to perform in the organizations
Being provided with proper assignment commensurate with one’s
QSEs.
Being provided with the proper human resources, tools,
equipment, and machinery needed to perform assigned tasks.
Being provided with the budgetary support to complete the
assignment
Being provided with sufficient time to perform critical work
activities.
Role of Opportunity in Individual Performance
High
Performance
Low
Low Optimum Ability & High
Willingness but Opportunity
to work is gradually improving
High
Upper Limit
Performance Optimum Opportunity
Lower Limit
Low
Willingness with optimum
opportunity at later stage
Degree of Control over Technology &
External Factors
Technology refers to the methods, tools, facilities
and equipment a person uses in performing a task.
Autoworkers “use” a complex assembly line with

highly interdependent activities to manufacture a
car. An artist’s technology is a drawing board, paint
and a brush.
Some tasks are dominated by human skill and other

tasks are dominated by technology.
Ability and motivation has bigger role to play
in skill dominated roles. While its role is
limited in technology dominated situations.
Consider the tennis players. Better equipment

will probably not improve their game, because
this is a skill-dominated task.
But contrast this with the assembly-line
worker, an example of technology-dominated
work. Perhaps only limited human skills are
required in this job.
Here the person has to be motivated only

enough to perform at a minimum level – to
get the machine running.
Once the technology is activated by the person,
then performance occurs at the required level, so
long as the equipment is running properly.
Role of Technology in Individual Performance
High
Performance
Low
Willingness but technology
support to work is gradually
improving
High
Upper Limit
Performance Technology working at optimum level
Lower Limit
Low
Willingness with optimum
opportunity at later stage
To expect performance to increase simply because
we obtain competent or more motivated people
may result in disappointment when technology is
the controlling variable.
The most effective method of improving

performance in technology-dominated work would
be to make substantial improvements in the
manner in which the technology is used.

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Performance Management Cycle

Ability = Existing level of Explicit Knowledge about

General Mental Ability

Job contents predominantly

However, GMA loses its consistent contribution in

Use of rewards, Non-compliance

This takes the employees’ ideas about what they

Since all possible aspects of the employment

Working Real Boundary of

Process Action taken

Demonstrations of harm are often used to

Process Action taken

 The rule of fear itself is counter-productive. It

 Fear breeds resistance, subterfuge and even

 It results in undesirable emotional side effects like

 Punishment has ripple effects and its impact goes

 Above all, who says that punished behavior will

 Impact of punishment is momentary. The stopped

 It has therapeutic impact. It can prevent the rule-

 Potential harm of remaining silent and doing

It is the power of charisma and fame and is wielded

Those with referent power can also use it for

Performance Optimum Opportunity

Autoworkers “use” a complex assembly line with

Some tasks are dominated by human skill and other

Consider the tennis players. Better equipment

Here the person has to be motivated only

Performance Technology working at optimum level

The most effective method of improving

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