Effective Performance Management A good performance management system ensures every individual understands how they are contributing to the goals of the organisation and ultimately the company's performance. Linking each employees performance objectives to their department objectives and in turn overall company objectives is key. It is important that any performance management system is seen as fair, employees are given the opportunity to contribute fully during the process and feel able to address issues as and when they occur rather than waiting for a review. It is important managers understand how to set both performance and development objectives with the input of the member of staff, can hold meaningful and productive reviews and use the opportunity to discuss development opportunities. Employees who understand how they contribute and are recognised for their contribution are more likely to be motivated, engaged and perform better. This will lead to a higher performing organisation. Using the performance reviews to identify development opportunities for high performing employees helps staff retention and engagement and can feed into succession plans. Conversely recognising poor performance early allows support to be given to individuals in a timely manner and development opportunities to be offered potentially avoiding greater problems in the future.