Selecting an appropriate performance management system isn’t an easy task as every business has different requirements. However, taking the following factors into consideration when selecting a performance management system can make your job easier:

  • It should be in line with your business goals.
  • It should be simple and easy-to-use for all the employees
  • It should be compatible with the existing systems in the organization.
  • It should promote the training and development of the employees
  • It should generate real-time reports to gauge employee performance periodically.


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Before you decide to invest in a new performance management system for your organization, be well aware of the merits and demerits of the performance management system which you may be currently using and set the right expectations from the new system. Taking note of the features you are looking for in the performance management system to reduce the burden of your mundane tasks would make the process a lot easier to manage. The right kind of performance management system streamlines your HR processes in a manner that reduces the overheads associated with it. However, performance management systems usually offer an extensive list of features and benefits which provide value to your organization. It is imperative to select a system that best suits your organizational needs, even if it comes with a limited set of priority features. Selecting the right system can be a tedious process as you will have to approach different vendors and ask for a demo of their products in order to select the right one.

The checklist given below will help you make a wise selection.

Business Goals

Before investing in a performance management system, it is mandatory to decide on the business goals that need to be accomplished in the long run. What do you want to accomplish with the performance management system? Does it help monitor employee performance amicably? Is it aligned to your ultimate business goals? An efficient performance management system should provide continuous unbiased feedback to the employees depending upon their performance and facilitate the linkage of employee goals to the company goals/priorities. Goal alignment and agility in the system drive the expected results and the employees perform up-to-the-mark when they are provided with relevant and periodic feedback about their performance.

User-friendliness of the software

The performance management software should be easy to use for the employees. The user-friendliness and intuitiveness of the software lead to faster adoption among the employees at all levels of the organization. User-friendly design and features promote flexibility of use and wouldn’t require a lot of training time and the employees can start using it as soon as it is made available to the organization.


When you select a new performance management system, ensure that it doesn’t interfere with the working of any other system. Also, make sure that the new system you choose to adopt is integrated seamlessly into the existing system so that there is no loss of useful employee data and the existing modules are compatible with the new ones.

Learning and Development

A performance management system must contain relevant learning modules to keep the workforce at par with ever-evolving business needs and thus promote employee development and growth. Fostering a culture of continuous learning and growth drives employee retention and commitment towards the organization. The PMS should be able to identify the unique training and development requirements of the employee by assessing the competencies so that the employee can be provided the relevant training in sync with his/her aptitude and abilities to chart out a suitable career development path.

Real-time reports


Real-time reports from the performance management system helps to gauge employee performance effectively on a real-time basis. It also aids in instant gratification for the employee contribution towards the organization.

With the right performance management system in place, your organization can align the performance of your employees with your business goals and conduct employee appraisals in a hassle-free manner, to identify their areas of development and ensure the success of the organization along with that of its employees.

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