Assessing the impact of the performance management system on the performance of employees of Erongo RED
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Date
2019
Authors
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Publisher
University of Namibia
Abstract
The performance of employees impacts overall organisational performance, hence the
premise for Erongo Regional Electricity Distributor Company Pty (Ltd) utilising the
performance management systems (PMS) tool to set targets and benchmarks for its
employees' performance. The PMS is also a means to motivate them to achieve
organisational goals and objectives. According to Bourne, M, Neely, A.D., Mills, JF. ,
and Platts, K. , (2003a) there is evidence that many organisations that attempt to
implement PMS have not been successful. One reason for the low success rate is a lack of
guidance on implementation. This study presents an investigation into the impact that the
Erongo RED Performance Management System (PMS) has on employees' performance.
During this investigation, special attention is paid to the employees' attitudes and in
establishing how Erongo RED Executives and staff perceive the principle of linking
performance bonuses to performance. The study further looked at determining challenges
faced during the implementation phase. The study adopted a quantitative research method
with data being analysed using descriptive statistics to gain more understanding on the
research participant's perspectives on the PMS in terms of their skills and knowledge. The
population of the study was ninety-three (93) respondents who consisted of executives,
senior managers, middle management, specialised or senior supervisory, skilled or semi skilled and unskilled staff. Data was collected using standard self-administered
questionnaires. It was coded, entered and analysed through the Statistical Package for
Social Sciences (SPSS). The study was set up after witnessing that the performance
management system created strains between those who manage the services and those
who are managed within them. This trend has prompted a debate for and against the
objectivity and compatibility of the impact of performance management systems on
employee performance. To conclude this debate the researcher carried out this research,
studying the perception of employees on the PMS. The study revealed that the benefits of
goal setting were not well proven and that the organisation needs to recognise that to
improve the effectiveness of goal setting, one needs to start from the top. It was noted that
more top management commitment on the PMS was required. Senior management "buy in" to the system is likely to have a direct effect on the success of the PMS. Leadership
must walk the talk and lead by example on perfom1ance. Executives and employees,
particularly thought that the company's focus was more on business processes to improve
alignment of goals to business strategy and enhance the quality of those goals only.
Overall, the study also found that the line managers are not prioritising performance
management conversations and feedback satisfactorily. There is a general observation that
the performance management system in Erongo RED de-emphasises the continuous
reviews and assessments to encourage more regular feedback. There is also a perception
that the Erongo RED performance management system is like a penalising tool used by
supervisors on their subordinates and that the employees' performance is not duly
acknowledged as it is supposed to be
Description
A thesis submitted in partial fulfilment of the requirements for the Degree of Master of Business Administration (Management Strategy)
Keywords
Performance Management System (PMS), Erongo Regional Electricity Distributor Company Pty (Ltd, Targets and benchmarks, Employees' performance, University of Namibia, Namibia