Performance management is key to achieving sustained competitive Essay

Performance management is key to achieving sustained competitive advantage - Essay Example advantage (Amit & Schoemaker, 1993; Barney, 1991; Schoenecker & Cooper, 1998). Human capital is more mobile than other intangible resources (Teece, Pisano, & Shuen, 1997). Therefore, it may seem an unlikely source of sustained competitive advantage. Hence the organization must search for the means and ways to retain them to achieve completive advantage. Competitive advantage is gained only when the organization selects or develops these resources and structures work tasks and the reward system in ways that motivate the team to perform well and thereby contribute to organizational effectiveness (Guzzo & Shea, 1992). Some organizations reward employees financially when they demonstrate an ability to acquire and master new knowledge (Jenkins & Gupta, 1985; Gerhart, 2000; Lawler, ch-10).Also some studies like, Jackson & Schuler, 2002 considers that organizational structures for rewards improve organizational performance and proves competitive advantage rather than team effectiveness and selection and training. But according to Dobbins, Cardy, Facteau, & Miller, 1993 opinion, system factors are the only constraining influences that restrict individual ability and motivation, and result in lowered performance. Performance management involves enabling people to perform their work to the best of their ability, meeting and perhaps exceeding targets and standards, and hence the PM system involves the following components.1. The focus is on an individual's work.2. There are expectations or standards of performance.3. There are usually two sessions between the employee and the evaluator: one to establish the standards and another to review performance. 4. The evaluator is usually the person who has line management authority over the one evaluated. 5. The evaluation session usually results in some written conclusion--some paper trail regarding the performance of the person reviewed. Corporate Performance Management (CPM) has become a widely adopted strategy execution in the current day corporate scenario with systematic and integrated improvements in the management processes to ensure efficiency and effectiveness. At the core of CPM is A metrics-based strategic planning and execution framework that helps align strategic plans with resource allocation and strategic initiatives Strategic goal alignment through enhanced communication and focusing processes / resources towards organization objectives A structured information based review mechanism that provides the feedback loop and connects strategic planning to operational performance measures Eg: Infosys is a best example to observe the competitive advantage of the company that has achieved through the adoption of CPM approach. Performance management and improvement is observed as Cycle to adopt in the process with certain steps. The practice of Infosys CPM is observed through the following steps of PM cycle. 1. Performance planning: Here