The determinants of effective performance management in South African utility companies

Abstract

The purpose of this study was to evaluate the determinants of effective performance management in South African utility companies. A non-profit organisation was chosen as a representative company for the water utility sector in South Africa. The organisation has embarked on a process of developing a performance management system and this study will aid the organisation in their process. The study was undertaken to understand what the determinants of an effective performance management system are. A comprehensive literature review was conducted by the researcher to get a better understanding of the various aspects of performance management and an overview of the water sector of South Africa. An empirical study was conducted and questionnaires were used to gather the data. An analysis of the research data was utilised to conclude the findings. Employee involvement, proper design of the reward system, effective performance appraisal and the successful implementation of the system are some key factors for effective performance management. The findings of the study indicate that employee involvement is low. The employees perceive the vision, mission and strategy within the organisation as poorly articulated and feel that they are not rewarded for their skills and knowledge. The majority of the respondents apprehend the performance appraisal system to be unfair. The author prescribed recommendations to improve employee involvement and the articulation of the vision, mission and strategy of the organisation.