Performance management is a process by which managers and employees work together to plan, monitor and review an employee's work objectives and overall contribution to the organization.
Researchers at Purdue University have found that, when effectively implemented, performance management best practices result in a wide range of benefits for employees, managers and companies. Goals are the basis of an effective process. ... Clearly communicating strategic business objectives is the first step to creating alignment.
More than 600 agribusiness professionals responded to the Performance Management in Agribusiness survey conducted last year by the Center for Food and Agricultural Business at Purdue University. Food and agricultural business leaders can use the results from the study to better understand and manage talent within their organizations.
A report, based on the survey and the center's talent management model, explores six key areas: strategy and talent requirements, talent acquisition, performance management, learning and development, engagement and retention, and succession planning.
"Survey respondents confirmed what we suspected: Performance management matters," said Michael Gunderson, Purdue associate professor of agricultural economics and associate director of the Center for Food and Agricultural Business. "But, historically, economics researchers haven't really focused on understanding the roles of individuals in the economy or within the business environment.
"Businesses are made up of individual people, so we can't ignore their roles, their individual differences or the ways management can successfully lead the people within their organizations," Gunderson said. He served as the survey’s principal investigator.
The goals of the survey included assessing how business leaders grade themselves on performance management and how employees grade their companies' overall performance management strategies, and understanding the links between these strategies and employee performance.
Not surprisingly, employees responding to the survey said they were motivated by challenging goals, said Gunderson.
"Notably, it was employees, rather than managers or executives, who were more likely to respond that goals weren't challenging enough," he said. "This suggests that if there is a question regarding the challenge, managers might push employees a bit further."
Important to Find a Balance
Another key survey finding is that managers in some areas have difficulty finding the right balance of managing performance based on outcomes versus employee behaviors.
"Some managers struggle in conducting performance management with only results in mind, given that sometimes luck can play a role in outcomes," Gunderson said. "In our survey, sales, marketing and human resources professionals were much more likely to use a combination of outcome and behavioral assessment relative to finance and operations professionals."
Editor’s Note: Other researchers involved in the center's talent management initiatives and included in the themes report are: Jay Akridge, Glenn W. Sample Dean of Purdue Agriculture; Karen Grabow, organizational psychologist and principal of Grabow Consulting; Mike Boehlje, Purdue distinguished professor of agricultural economics; Scott Downey, Purdue associate professor of agricultural economics and associate director of the Center for Food and Agricultural Business; Allan Gray, Purdue professor of agricultural economics, director of the Center for Food and Agricultural Business, and Land O'Lakes chair for food and agribusiness; and Masi Keshavarz, research project manager for the Center for Food and Agricultural Business.
The full report is free to download at http://agribusiness.purdue.edu/TalentReport.