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In governing today’s organizations, the managerial practice of monitoring and controlling performance is experiencing a transformation. The traditional performance management practice of monitoring and controlling work activity through the use of performance evaluation forms, periodic supervisor/direct report performance reviews, and compliance to company policies and procedures is undergoing change. Traditional performance management practices are becoming obsolete. Managers are now using psychological contracting, cultural influence, and process discipline to instill and sustain accountability management, marketplace flexibility and continuous growth.
This performance management transformation is needed because business enterprises can no longer compete and thrive solely on being a low price, reliable supplier of quality products and services. The only sustainable competitive advantage businesses can possess in the 21st century’s ever changing, global marketplace is their capacity to learn with customers faster than marketplace competitors. As a result, learning has become the competitive advantage every manager must institutionalize and sustain, thus prompting the needed change from traditional performance management practice.
To meet these new global marketplace challenges, managers must transform traditional performance management practice from activity-based work compliance reviews focused on situational adjudication of performance dysfunctions, and implementing promotion and compensation decisions. Instead, they must now use learning based communications that instill and sustain a learning culture of inclusion, participation, trust, continuous improvement, shared accountability, process discipline and ownership, as well as promoting innovative thought and action. By doing so, managers engage organizational stakeholders in internalizing the collective reasoning needed to maximize human and organizational potential in order to establish and sustain enterprise competitiveness.
Managers who can successfully master learning based performance management practices and communications build and sustain high performance learning organizations. These organizations possess the competitive advantage of being able to learn with customers how to create value, achieve satisfaction, and pursue excellence faster than their competitors. As a result, they embrace and use change to master the speed and complexity of marketplace dynamics as well as using innovation and growth to maximize potential for the benefit of all.
The 21st century global marketplace is fraught with risk, ambiguity and confusion. Management communities that develop and master the use of learning based performance management create and sustain marketplace relevance for their organizations. Managers who embrace this needed transformation govern for growth, thus avoiding their business enterprise becoming a victim of global marketplace competition and dynamics.