Performance Management System Tools


Performance management is a function where business owners and managers review their company to measure its effectiveness and efficiency. Many companies use or develop tools to help them complete this process. While many performance management tools exist in the business environment, owners and managers can also create their tools unique to their company's operations. Measuring performance can help a company correct issues and reward employees who complete tasks according to the company's operating standards.

Job Description

  • Job descriptions outline the specific tasks and responsibilities for each employee in a company. These descriptions typically start from executive directors and managers all the way down to frontline hourly employees. Companies use job descriptions to create a reasonable expectation of performance. Employees often receive evaluations based on the activities or tasks for their position.

Output Goals

  • Setting production output goals is a performance management tool where owners and managers attempt to maximize the use of economic resources. Output goals typically relate to the function each department completes. For example, sales may have a dollar amount goal for each month. This ensures each individual in the sales department works as hard as possible to achieve the goal. Companies may offer incentives to employees who contribute the most effort for completing goals.

Annual Reviews

  • Annual reviews are an employee performance tool companies use to gauge the performance of each worker. Managers also face annual reviews to determine how well they ran their department or contributed to the company's success. Companies use annual reviews as a formal human resource function that often dictates the amount of bonuses, compensation increases or additional vacation time.


  • Feedback allows employees to provide company management with information regarding the company's business operations. Owners and managers can use feedback to improve the performance management process or other processes in the company. Allowing feedback helps avoid a confrontational tone when reviewing performance. Companies can use feedback to assure employees that performance reviews are not disciplinary tools but an opportunity to create a better work environment.

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