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Performance management is a term widely used within HR and has a specific meaning associated with reviewing and managing individuals’ performance. However, there is also a growing concern in performance measurement. Measurement has to lead to insight and insight to action – hence the term corporate performance management is used to differentiate between management of performance at the level of the individual and the corporation. Over the last one decade, there has been a big change in the corporate performance management practices.
Mid of 20th century witnessed the causes for evolution of measurement and its importance. The industrial revolution also led to the same in order to cater the need of investors in big projects. Johnson (1983) also advocated this concept of performance measurement evolution.
Measurement system not only in term of designing of system but, also, disposal of existing system is very important. Indian companies are innovative enough to design the new system as per the demand, but disposal of existing or traditional system is very poor. Meyer and Gupta (1994) also express the same view.
The literature in the field of performance measurement emphasizes the importance of maintaining relevant measures that continue to reflect the issues of importance to the business (Gates, 1999). There is now an explicit multiple stakeholder framework – the performance prism (Neely et al., 2002). This performance prism well defines the importance of third pillar i.e. stakeholder.