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How Should a Performance Management System Be Chosen?

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Are you looking for a performance management system? Aren't you even sure what such a system is? Then you are exactly right here. Here you will find all the information you need about performance management systems.

What is a Performance Management System?

Performance management systems, known in business as PMS, are a way of managing the performance of a company's employees. This strengthens the company and improves the performance of its employees. Performance management systems also take into account the teams and departments within the company.

If a quality management system is in place, the company will become more productive and innovative. This will result in the company producing better products and services.

Why is a good performance management system important

Performance management systems are the key to a company's success. As mentioned earlier, a performance management system can improve an employee's performance. A system that delivers this important service can take the pressure off the company's leaders.

Many employees complain that performance reviews don't help them. That's why many large companies are turning to these systems, which can provide more helpful feedback. Finding a system that provides useful assessments can be difficult. Luckily, this guide will help you choose the best system.

What are the key features of a performance management system?

If you would like to learn more about the key elements of performance management, visit this helpful link. However, below is a summary of its key features:

  • Setting and managing achievable goals.
  • Reviewing employee performance with the aim of improving it.
  • Provide useful suggestions and feedback.
  • Conduct performance reviews whenever required.

As you can see from this list, there are several essential factors that performance management systems must cover. For this reason, having an excellent performance management system like IceHrm's performance management system is crucial to the functioning of the company.

How to Choose a Performance Management System?

When choosing a performance management system, you need to consider several areas. You need to consider the following factors:

Company requirements

When choosing a performance management system, you need to think about your company's specific needs. Different companies have different requirements.

This means that you need to think about and identify the problems currently associated with your company's performance management. If you uncover the vulnerabilities in this area, you can find a system that doesn't have these problems. For example, managers may not currently be successful in conducting assessments.

The ease of use

A system that no one can use sounds pretty ineffective, right? If you're looking for a performance management system, it needs to be easy for managers to use. Otherwise, it will increase their workload instead of making it easier. To learn how to use a system, managers may have to spend time and resources on in-depth training.

To avoid this problem, you should check whether a system is easy to use. If this is not the case, you should look for another system. Systems that require as little training as possible are beneficial to the company.

Achievable goals

A system that understands employees and the goals they can achieve is of great benefit to a company. If this is not the case, employees will be able to achieve these goals either with great ease or with great difficulty. Therefore, a system should have a perfect balance between these two opposites.

To verify that these goals are being met and to set future goals, a performance management system should retain data from previous months.

These goals should be SMART. This acronym stands for “Specific, Measurable, Achievable, Relevant and Time-Bound.” SMART goals are an effective way to measure performance. This essentially means that the goals are as follows

Specific - clear goals tailored to the individual/team.
Measurable - there is a method to find out if the goals have been achieved.
Achievable - it is possible to achieve these goals. They are not unreachable.
Relevant/realistic - they are relevant to the employee or employees and can be realistically achieved.
Time-bound - they have a clearly defined time frame. This can be a specific date by which they should be achieved.

You may want to implement a performance management system that takes SMART goals into account.

Helpful feedback

One of the most important tasks of a manager is to give feedback to their employees. In this way, they can improve their work and compensate for any weaknesses in performance.

In order for employees and departments to improve their performance, a system must provide frequent and rapid feedback. Otherwise, they will not be able to improve in the areas that are currently holding them back.

This feedback should be updated regularly to keep employees informed. It shouldn't take too long to provide this feedback. Otherwise, the feedback could already be outdated by the time it reaches employees.

This feedback should also give employees the opportunity to react. Employees can comment on how the feedback should be implemented. This is especially true when these employees are part of a team. Because the team members have important information about each other. These insights are very valuable. Consequently, this feedback should also have a human side.

Performance improvement plans

One of the most important aspects of performance management is performance improvement plans. What are Performance Improvement Plans? Well, these plans are designed to highlight deficiencies in an employee's performance and give them advice on how to improve.

Performance improvement plans are similar to feedback in that they can help an employee be more efficient and productive. However, they are often more formal and structured than traditional feedback.


Every company is different. These companies are made up of employees, each of whom is also an individual. For this reason, you need a system that can be adapted to your company and its employees. You want a system that is flexible and can be adapted to your various needs.


Performance management systems are offered at a wide range of prices. This means you'll likely find one that's within your budget. If you don't make much profit, you won't be able to spend your entire budget on a system.

When you have more money at your disposal, you also have more options. However, you shouldn't just go for the most expensive system. Because that may not be the most effective system for your company's needs. Instead, the price should simply be used as a guide to see what you can afford.


You probably already use different systems in your company. Therefore, you want a performance management system that is compatible with your current systems.

If this is not the case, you will need to adapt your current systems to the new system. This collision can slow down work and may be more of a hindrance than a help.


If you're looking for a system, you probably need one that's state of the art. You should avoid outdated systems because they may no longer use procedures that are no longer in use.


For a system to be successful, it must be versatile. This means it can be used by a number of different companies. You should try to find a system that can be customized to suit your company's needs.

Coupled with the customization feature mentioned above, you should be able to make a management system work for you. This should not work the other way around, i.e. H. the company should not have to change for the performance management system to be implemented.

Ultimately, there are many factors you need to consider when choosing a performance management system. While this may seem overwhelming at first, this guide will help you identify these elements. Please think carefully about these elements to ensure a high quality performance management system.

Check out IceHrm's performance management module to see how it can help you access your employees' performance.

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