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College of Contract Management United Kingdom
College of Contract Management
United Kingdom

Performance Management - What Are the Three Stages? | CCM


What is performance management?
Who manages the performance & productivity?
Why is it needed?
The three stages of performance management
The importance of tracking performance
Ways to implement increased productivity
Modern performance management
Human resources careers
Online HR courses
Why choose the College of Contract Management?


What is performance management?

Performance management is crucial for improving and understanding a business. It is an umbrella term used to categorise numerous platforms and branches of management and human resources. A vitally important task is analysing growth and ensuring employees are meeting targets and increasing business functionality and productivity. This can be done on the scale of an entire company, or as small as an individual employee.

As a key part of human resources, performance management is widely recognised as a carefully curated cycle of processes including expectations, evaluation and consistent review. It is the role of somebody in human resources to monitor and repeat when new projects begin. Large corporations implement frequent performance reviews in order to maintain a consistent workflow and reviews of day-to-day activity. This helps to ensure all employees have clear aims in their day to day work and have accountability for their progress.


Who manages the performance & productivity?

Human resource managers or those working in operations usually manage this area. This is because they have excellent oversight of an entire company and its departments. During this process, a human resource manager may choose to create employee development plans to track and observe productivity in order to provide comprehensive reports of individual performance. This helps senior professionals to understand and acknowledge hard work and allow adequate praise or consequential reprimand for underachieving or missing objectives. It is the role of the human resource manager to relay these duties and they can delegate the sanctioning of employees to project managers, chief executives or team leaders if they choose.

Why do we need it?

The idea of performance management is a great way to inspire employees and encourage focused learning toward mutual goals and objectives. This creates a solid working environment, which will yield better results in many aspects of a business. This is often done best with specialist software. This can monitor and track aspects of finances, productivity and growth. The process is extremely valuable for many different departments of a company; it can identify areas that need improvement and areas which are not hitting targets in terms of performance.

As a human resource manager, performance reviews are usually extremely insightful in terms of evaluating different sectors or even regions of a company if the review is widespread. It helps directors, managers and employees understand better where performance is successful or where there are processes that require improvement. It can also allow for better coaching of employees and will increase motivation and working towards mutual goals. We all know it’s great to receive feedback on your work. Many will experience increased motivation and satisfaction when they know their hard work is appreciated. Similarly, it will encourage those who are seen to not be meeting targets to increase their work output and meet individual and company targets.


The three stages of performance management:

The three stages of performance management can vary from company to company. The goals of each business will differ, therefore their performance management will be different. Generally, the cycle and the outcome will remain the same; the point is that reflection and consistent review is undertaken in order to maintain development both on a company level and on an individual employee level. These three stages can be supplemented with more in-depth sub-stages if needed. Generally, these stages come in the following formats and can be expanded to omitted as needed for your business strategy.


Firstly, throughout any performance management, preparation is key. This is the stage that is important for laying out areas of focus and communicating goals and desired outcomes. The preparation is important for determining how often and how in-depth the performance review will go. Quite often, companies have a yearly or bi-annual performance review of their employees, in which the employees may participate and share their suggestions. Some, as mentioned earlier, have more frequent reviews of performance. Many HR managers implement performance reviews based on when they think their employees and outputs need monitoring.

Active Reviewing

This is a vital and observational stage of performance management that will need careful attention. Furthermore, it can be a time to flag up potential roadblocks or any employees who may not be meeting requirements or hitting targets. There are many stages to the reviewing and monitoring stage. In order for a review to be successful, it needs to monitor all aspects of productivity, including accomplishments, delays, setbacks, issues and successful processes.


Arguably, reflection is one of the most important stages of performance management. This is since it is the time when improvements can be made. Deep reflection is essential when looking for growth strategies; this time can be used to view lessons learned, successful strategies and what could be done better. Making sure you reflect as both an individual and as a collective (i.e the company) is a great way to work towards targets and identify areas of weakness. All good businesspeople understand there will always be areas lacking in quality or performance; adjusting principles and priorities to mitigate these weaknesses is vital.


The importance of tracking performance

As we’ve mentioned, the process of tracking performance throughout a business is extremely important when identifying room for growth and improvement. Creating updated and relevant business models is also vital to gaining more insight into aspects of improvement or success. It’s also a great way to encourage new starters and long-term employees to work towards the same goals. Tracking performance also helps identify hard-working employees. This identification allows employees to feel motivated. It is particularly useful when rewards and recognition are awarded for exceptional performance.


Ways to implement increased productivity

Firstly, clear and focused objectives. This is a key way to improve overall company performance. Communicating effectively is one of the best ways to get across your widespread goals and encourage your employees to share your interests in development. If you’re working as a human resource manager, it will be beneficial to create targets and goals based on an individual’s field and tasks. Make sure you are inclusive of specific circumstances regarding each person and make their objectives realistic but challenging. This will help increase productivity and will help individual employees work together as a collective to increase the overall performance of a company.

It will be most valuable if these achievements are measured within a management system, such as Microsoft Project, Asana or Primavera. Many software systems such as these will help track and analyse projects, as well as being able to incorporate individual employee needs and timeframes. This is where human resource management blends into project management; the two will work harmoniously to track and view project and overall progress. As a project manager, get your employees’ opinions; ask questions, request feedback and suggestions to make the process of developing inclusive and inspiring for all levels of a business. If employees feel like they are a part of the process, they will be more inclined to work towards collective objectives.


Modern performance management

Today, the methods businesses use for performance management vary from company to company. Further, many believe that annual performance reviews are less effective. Many large firms use the consistent and continual review in order to engage in regular communication with employees regarding reflection of performance values.

This particular type of agile management has proven popular with many large corporations, mainly because of their large number of employees, extensive daily tasks and ongoing projects. Strategic management is important for workforce satisfaction and delivering results within the business. A successful modern HR manager will help motivate and enthuse staff about improving the business they are working for.


Human resources careers

Working in human resources can be an extremely valuable and challenging career. If you have strong and complex organisational skills, human resources might be an excellent career path for you. Sometimes, people choose to work their way up in a company to become involved in human resources.

There is a quicker way to fast-track a career in HR, though. You can complete an online HND in Human Resources which will propel you into an HR career, providing you with the skills and competencies you need to manage and organise a workforce. It can be an extremely rewarding role. Indeed, it can be satisfying when projects and employees are successful and meet goals and targets. Throughout an HR role, you’ll also work within the realms of recruitment.

You’ll help ensure that new candidates are appropriate for your team. This is an important and crucial step; new candidates have the potential to improve to degrade the business. Being empathetic, inquisitive and following your gut is important when searching for new recruits.


Online HR courses

There are numerous benefits to picking an online method of study. When searching for a role in HR, it can be beneficial to have some previous experience in hospitality, management or operations. Most importantly, if you study online, you can work throughout the course and study in your free time when it suits you. This flexibility is vital for those who can’t take time away from work due to financial or home commitments.

One benefit of online study is flexibility. Flexibility results in increased productivity. This may be due to decreased stress from travel, expenses and large classes. Online learning provides a much more personal learning experience, with smaller, more intimate class sizes. Moreover, you can ask your teacher questions and request advice as you would in a traditional college or university.


Why choose the College of Contract Management

When it comes to online courses, the College of Contract Management has a wealth of experience in providing ‘live-online’ courses and interactive teaching. Our lecturers are experts in their fields. They will deliver practical examples of industry theory in order to provide a comprehensive teaching experience.

Our courses cover many aspects of business, including Finance and Accounting, Human Resources, Business Law and Strategic Management and Business, among others. All our courses cover a comprehensive syllabus of learning outcomes. Moreover, your lecturer will make sure you receive an in-depth look at your chosen area of business.

Since your lecturers are live-online, you’ll be able to see their screen as they work through examples with you. Each week will provide you with new resources which you can use throughout the week. It’s important to research further and develop your understanding in human resources as you learn. Consequently, this will give you the expert knowledge to understand the three stages of performance management. Mostly importantly, you’ll also learn other important industry knowledge. You can contact our team at for more information.