MESSAI.iO

AI summary

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The purpose of performance management is to facilitate reward distribution, but it should also be part of an organization's management control processes to steer towards desired goals. The current approach is often coercive, relying on evaluations and pay-for-performance, but a more enabling approach using social, psychological, and cultural mechanisms is recommended. This shift can lead to more effective performance management.

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Abstract

Abstract This chapter is grounded in the critical question, “What is the purpose of performance management?” The purpose of PM today is primarily to facilitate reward distribution as part of an organization’s pay-for-performance philosophy. This purpose remains at the center of this practice, despite little research to support it. An organization design lens suggests PM should be a part of an organization’s management control processes, helping to steer the organization toward its desired goals. The authors argue PM should adopt a more enabling approach to control instead of a more coercive approach, relying more on social, psychological, and cultural mechanisms to influence employee behavior, versus evaluations, differentiation, and pay for performance.

Key findings

  • Little research supports the current purpose of performance management
  • Performance management should be part of an organization's management control processes
  • A more enabling approach to control is recommended over a coercive approach

Keywords

Control (management)Management control systemProcess managementPerformance managementKnowledge managementHuman resource management

Identifiers

DOI
10.1093/9780197830642.003.0003
Journal
Performance Enablement
Year
2026