Performance management trends–reflections on the redesigns big companies have been doing lately

Abstract

PurposeSince several high-profile companies announced that they were radically redesigning their performance management systems and processes (PMSPs), commentators and scholars argue that these changes represent a trend that many companies are following, and even more are considering pursuing. The present paper aims to provide an overview of these redesigns and their rationales from the companies' point of view and theoretically reflect on their organisational value.Design/methodology/approachThe analysis is based on a review of articles from journals, professional magazines and the business press that describe how nine high-profile companies from the debate changed their PMSP design.FindingsThe PMSP redesigns are directed towards what in the literature has been referred to as people PMSPs. The authors identify five organisational challenges to which the people PMSPs are exposed and specify the design elements that the companies have changed to meet these challenges. Finally, the authors outline a set of theoretical propositions that demonstrate some of the trade-offs involved with the redesigns.Originality/valueThe paper contributes to researchers and practitioners by providing more insight into why and how companies have redesigned their people PMSPs. Answers to these questions are vital in understanding the trends and redesigns that practitioners are currently considering. Furthermore, since the empirical research of the effects of these redesigns is still limited, we outline a set of theory-based propositions helpful for future empirical investigations.