Abstract
Performance management (PM) plays a vital role in the successful operation of an organization. It is essential for organizations to understand the correlations between factors, problems and solutions to enhance the efficiency of PM. Mixed method research is applied, including explanatory sequential design (Quan → Qual). By analysing findings and interviews from a cluster of small and medium enterprise (SME) high-growth sectors and high-impact sectors based on descriptive and inferential statistics, the PM finding is that these two SMEs are not different. Moreover, the factors that influence PM are recruitment, retention and retirement. Regarding PM problems, the key factors are a lack of employee participation, unclear goals, unfair evaluations, ineffectual communication and ineffective application of evaluations to improve PM. Therefore, related private and government organizations should enhance their knowledge and understanding of problem-solving procedures by attending trainings or discussing these topics with experts to raise their awareness of PM and to learn how to resolve related issues, particularly factors that directly influence PM, to ensure progress in their performance.
Highlights
One of the important processes or tools that enhance organizational efficiency is performance management (PM)
PM can be divided into five stages.[2] (1) The prerequisite process stimulates the participation of employees and the preparation of the information required for organizational, departmental and individual operations.[12,13] (2) The performance planning stage identifies the desired outcomes of organizational, departmental and personal operations; this stage identifies the capabilities required for operation as well as capability development guidelines.[14,15] (3) The performance evaluation process measures actual versus expected performance within a specified scope based on predetermined objectives.[16,17] (4) The performance review process involves executives and employees discussing performance, strengths, weaknesses, solutions and improvement areas.[18] (5) The performance application stage refers to developing an organization’s plans, missions, strategies and human resource management (HRM).[19]
Different small and medium enterprise (SME) backgrounds did not have a statically significant (p > 0.050) effect on PM. This finding implies that both SME high-growth sectors and high-impact sectors have similar outcomes when using the PM process, which consists of performance prerequisites, planning, evaluation, review and application,[2] because these two sectors garner continuous support regarding management training, funds and business mentoring from private and government sectors
Summary
One of the important processes or tools that enhance organizational efficiency is performance management (PM). PM is a continuous process of setting goals and objectives that align with strategic adjustments and objectives in an organization to ensure highly efficient performance.[10,11] PM can be divided into five stages.[2] (1) The prerequisite process stimulates the participation of employees and the preparation of the information required for organizational, departmental and individual operations.[12,13] (2) The performance planning stage identifies the desired outcomes of organizational, departmental and personal operations; this stage identifies the capabilities required for operation as well as capability development guidelines.[14,15] (3) The performance evaluation process measures actual versus expected performance within a specified scope based on predetermined objectives.[16,17] (4) The performance review process involves executives and employees discussing performance, strengths, weaknesses, solutions and improvement areas.[18] (5) The performance application stage refers to developing an organization’s plans, missions, strategies and HRM.[19] Watchareejirachot[20] and Kanchanopast[21] considered PM in businesses of different sizes, structures and types that demonstrated different operations These early research findings lead to the following hypothesis: H1: Different SME backgrounds will lead to different PM results.
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