A proposed methodology for evaluating the quality of performance management systems

Abstract

Purpose The purpose of this paper is to develop a methodology for evaluating the quality of an organization’s performance management system. Design/methodology/approach The paper presents a theoretical development based in extant literature, using a field study to illustrate the application of the methodology in assessing the quality of the performance management system of the case company. Findings The study presents performance management systems as a network of interconnected elements instead of elements that follow a lineal sequence. The more consistently aligned the elements of this network, the more likely it is to be able to influence behaviours and decisions in desirable ways. Research limitations/implications The development requires its use by practitioners and researchers assessing the performance management systems of organizations to assess further implications. It stresses the need to differentiate the purpose of performance management systems from the objectives of the organization. Practical implications The tentative application of the methodology suggests that it provides a helpful tool for practitioners and researchers to assess the functionality of systems in place and to identify opportunities for improvement. Originality/value The methodology overcomes the two limitations of previous studies. First, it uses a holistic approach and does not focus on specific tools; second, it assesses the quality of the system, not from future company results that might be influenced by other variables, but from the consistency and alignment of the elements of the system.