Some of the bottlenecks or challenges in the implementation of a performance management system are as follows:
1. Lack of Alignment
The first challenge is the lack of alignment due to various organizational processes being created in isolation.
The link between strategy development, budgeting, and operational planning is developed by different groups of people with different frameworks being used.
The performance management system lacks alignment between individual performance, departmental performance, and organizational delivery, and so all systems default back to financial measurements.
2. Lack of Top Management Commitment
The most important hurdle to the ineffective implementation of PMS is the lack of time for top-level or senior managers to do their own or their subordinate’s performance planning.
One unit head not doing it sends the wrong signals all through the unit and defeats the purpose of PMS.
The last thing for any top-level or senior-level manager to say is that performance planning or review can wait, and more important is performance. Such statements also send wrong signals all through the company.
3. Lack of Organisational Support
In many cases, performance management systems fail to take off due to a lack of organizational support.
Such a lack of support is not as much for the system as it is for individual employees to enable them to do better.
Organizational support may be in terms of basic work conditions, resources, facilities, inputs from internal customers, etc.
These get highlighted in any performance management system. It is not right for an organization to say that every employee has to work all the time within the limitations.
It goes without saying, but the organization should demonstrate that it is willing to listen to the difficulties faced by employees and are willing to try its best to remove the bottlenecks.
4. Lack of Competencies in the HR Department
Lack of competencies in the HR department is the biggest bottleneck of ineffective implementation of performance management systems.
The most important competencies they need are the following:
- Business sense and involvement in the main business of the organization.
- Knowledge of all the departments and appreciation for each of them and their roles.
- Interpersonal sensitivity.
- Performance planning competencies especially identifying KPAs or KRAs and conducting performance review discussions.
- Organizational diagnosis skills.
- Ability to set a personal example by first implementing all they are asking others to implement in their own department.
- Counseling skills.
- Performance orientation.
- Initiative and pro-action.
- System building and monitoring skills.
- Credibility to carry on the line staff.
- Interest in working with the line managers.
5. Lack of Follow-Up on the Part of the HR Department
Where competencies may be available, if the HR department does not follow up, they may be neglected by default.
Hence the HR department must have an effective follow-up put in place.
The follow-up could take the form of quarterly performance review meetings, implementation review meetings, survey feedback, upward appraisal of the appraisers by their subordinates on time spent, the extent to which they listened and understood the problems of their juniors, etc.
The follow-up should be done both at an individual level and at this primary group level.