Q. Do most organizations have performance management systems? Are they required?
A. The majority of organizations practice performance management in some form, whether formal or informal. Large organizations may have integrated performance management systems. Mid-size and smaller organizations typically use a performance appraisal process to manage employee performance. According to a recent MSEC survey, the vast majority of participants use a supervisor-conducted performance appraisal process.
There is no legal requirement to have a performance management system; however, an organization can derive important benefits by practicing effective performance management. These programs can provide information to make and support employment decisions, to reward and motivate employees, to identify employee development needs/interests, and to facilitate communication between a manager and employee.