What is the main concept of performance management? what is the main function of performance management? What is main types of Performance Management ? , what is the tools of it?and how balanced scorecard differs from performance management?

asked Jul 14 '11 at 04:13

8gates's gravatar image


Performance Management usually refers to activities carried out by people / organisations to ensure that the way that assets are deployed provide as good a result as is possible.

This is a rather unhelpful definition I know, but is reasonably comprehensive - for it to make sense in any particular instance you have to become clearer about what specifically is referred to by some of the highlighted terms. A good one to start with is what you mean by result. Performance Management is a means to an end, but if you are not clear what the end is, everything else is rather less useful.

Operational Performance Management Much of the time the result in Performance Management refers to the regular output of a person / team / organisation - so number of widgets produced for example: as a result it is common for Performance Management to be linked to the management of operational activities, and how you incentivise people / teams / organisations to achieve preset performance goals (e.g. sales targets for salesmen). Determining what you expect someone / some team to achieve is not easy, but at least you know what they are supposed to be doing, and something about what they've done in the past, so it is usually just a question of picking a plausible number...

Strategic Performance Management Another common (but less so) result used in Performance Management is the contribution made by a person / team / organisation to the achievement of an organisation's strategy. Strategy is a vague concept at the best of time - usually articulated in terms of high-level, long-term goals (e.g. "to become the number one brand in the Pacific NW"). The problem with this is that:

  • deciding what a person / team / organisation should / could do about achieving this is often unclear,
  • how these activities are linked to the articulated result is usually obscure, and
  • how you will tell if what the person / team / organisation is doing is working well the stuff of mystery.

Strategic Performance Management Design is the name given to the process of working out answers to these questions... and this work necessarily also requires an understanding of who is expected to do the things that are required, how you will tell if the implementation of the strategy is on track, and what resources are needed / available. Doing this work in a timely and cost-effective fashion is not straight-forward, and specialist firms exist to help organisations do this work - one such is 2GC, the firm I work for. The Balanced Scorecard is a one of several frameworks that has been developed over the last 20 years to help organisations work through the steps required to carry out the steps required to design a strategic performance management.

You can find out more about performance management and the Balanced Scorecard by reading the materials made available for free in the 2GC Performance Management Resource Centre. These include introductory explanations, FAQ answers, case studies, and if you want to dig deep working papers and academic publications on various strategic performance management topics. Other sources of information on Balanced Scorecard and performance management exist on the web, and to help you track down the useful ones, the Resource Centre also includes a searchable database of websites 2GC has found that have relevant / useful information on these topics. Each site is briefly reviewed by a 2GC consultant, and key features of the site are noted and rated.

Hope this helps... ;-)

answered Jul 27 '11 at 05:51

Gavin%20Lawrie's gravatar image

Gavin Lawrie

edited Jul 27 '11 at 05:53

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Asked: Jul 14 '11 at 04:13

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Last updated: Jul 27 '11 at 05:53

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