Performance management is a term developed to depict a movement that began in the 1980s to reinvent government using ideas from the private sector

Performance management is a term developed to depict a movement that began in the 1980s to reinvent government using ideas from the private sector, with a goal of improving public institutions and restoring public trust through efficiency and effectiveness (Moynihan D. 2008). Jacobsen & Saultz, (2016) argue that performance management links information to decision making by defining performance standards, collecting data, establishing sanctions and rewards and reporting performance. Performance can be planned, measured, assessed and acted upon. When such actions occur in an integrated and systemic way, it is usually referred to performance management. Performance measurement is focused on how to measure what the administration is doing; performance management is concerned with detecting what are the most significant performance deficits and with formulating a strategy for mitigating them; performance leadership aims at motivating everyone in the organization to pursue the strategy (Behn 2013).
There are many advantages associated with the implementation of a performance management system. A performance management system can make the following important contributions:
Motivation to perform is increased. Receiving feedback about one’s performance increases the motivation for future performance. Knowledge about how one is doing and recognition about one’s past successes provide the fuel for future accomplishments.
Self-esteem is increased. Receiving feedback about one’s performance fulfils a basic human need to be recognized and valued at work. This, in turn, is likely to increase employees’ self-esteem.
The definitions of job and criteria are clarified. The job of the person being appraised may be clarified and defined more clearly. In other words, employees gain a better understanding of the behaviours and results required for their specific position. Employees also gain a better understanding of what it takes to be a successful performer (i.e., what are the specific criteria that define job success).
Self-insight and development are enhanced. The participants in the system are likely to develop a better understanding of themselves and of the kind of development activities that are of value to them as they progress through the organization. Participants in the system also gain a better understanding of their particular strengths and weaknesses that can help them better define future career paths.
Administrative actions are more fair and appropriate. Performance management systems provide valid information about performance that can be used for administrative actions such as merit increases, promotions and transfers as well as terminations. In general, a performance management system helps ensure that rewards are distributed on a fair and credible basis. In turn, such decisions based on a sound performance management system lead to improved interpersonal relationships and enhanced supervisor-subordinate trust (Keeping, L. M., & Levy, P. E. 2000). For example, a good performance management system can help mitigate explicit or implicit emphasis on age as a basis for decisions.