News: Performance Management
Performance management 'underused'
30 January 2009
Two-thirds of businesses do not have a performance management system in place to assess the impact of their financial incentive schemes.
Research produced by the Chartered Institute of Personnel and Development (CIPD) shows 68 per cent of UK firms are not aware whether their existing reward initiatives are working.
Charles Cotton, the group's reward adviser, claims these "stunning" findings could mean companies are wasting money and alienating shareholders.
He states: "Organisations may find that by not targeting reward spend effectively, they could see their biggest asset - their top performers - leaving."
The CIPD's survey found half of companies with over 5,000 employees undertake performance management to assess the impact of the schemes, compared to 29 per cent of firms with 50 employees or fewer.
A recent study by TalentDrain found 72 per cent of businesses have reported they will be increasing their focus on appraisals in the next year.
