The importance of Performance management process in a retail business context

 

Performance management (PM) is the process of ensuring that a set of activities and outputs meets an organization's goals in an effective and efficient manner. Performance management can focus on the performance of an organization, a department, an employee, or the processes in place to manage particular tasks.Harris, Hilary; Brewster, Chris; Sparrow, Paul (2003) In other words Performance management is a corporate management tool that helps managers monitor and evaluate employees' work. Performance management's goal is to create an environment where people can perform to the best of their abilities to produce the highest-quality work most efficiently and effectively. 

Theories related with Performance management

Theory	Definition	Authors
Goal-setting theory	The specific and challenging goals along with appropriate feedback contribute to higher and better task performance. The willingness to work towards the attainment of the goal is the main source of job motivation.	(Locke & Latham,1960s)
Control theory	Its helps in sustaining the performance management system by defining forms of control between the organization and the systems within.According to control theory, actions of all systems should be in sync with the overall goals and objectives of an organization	(Barrows & Neely, 2012)
Social cognitive theory	This theory provides explanations in support of performance management at several levels. The three-way interaction between what the performer is thinking, doing and the work environment itself provides a strong systems view of performance.	(Bandura’s 1986)

Four elements of Performance management 

1. Agreement
2. Feedback
3. Positive reinforcement (Rewards)
4. Dialogue 

In a retail business context the performance  management should, 

• Have  clear aims and measurable success criteria - Ex : Sales in value by quarterly or semesterly
• Be designed and implemented with the involvement of the employee
• Be simple - Ex : Particular product range target,
• Be aligned with organizational goals. 
• Focus on clarity and performance improvement 
• Explain rational which links them to rewards
• Be equitable , transparent 
• Be regularly assessed themselves against success criteria.

Importance of performance management to sales force for a retail organization 

• Its a kind of motivation to increase the performance
• Due to this process employee's self -esteem is increased
• Sales force's job definition and criteria for job success are clarified 
• Which will be helps to building and maintaining a relationship between immediate boss and sales staff. 
• Employees become more competent 
• This is a better protection from lawsuits
• This is a better and more timely differentiation between well performer and poor performers in sales. 
• Through this process organization's goals are made clear

According to the above mentioned importance of performance management process will leads to increase the retail sales team's performance in efficiency and  productivity manner. The process is to be  communicated properly with the employees and the supervision as well. In the present competitive economies employees have more opportunities in job market. Therefore organizations should consider the performance management process. 

Harris, Hilary; Brewster, Chris; Sparrow, Paul (2003). International Human Resource Management. CIPD Publishing. ISBN 9780852929834.

Appelbaum, S. H., Roy, M. and Gilliland, T. (2011) ‘Globalization of performance appraisals: theory and applications’, in Management Decision. Emerald Group Publishing Limited, pp. 570–585.

Locke, E. A. and Latham, G. P. (2006) ‘New Directions in Goal-Setting Theory’, Current directions in Psycholgical science, 15(5).