Businesses' ability to sustain their existence depends on their performance within the competitive environment. Businesses with management teams that hold a long-term perspective draw their future road maps by taking various scenarios into account. This matters for gaining superiority in competition with a proactive approach, and for not missing opportunities when they come to the business's doorstep. However, a matter as important as building strategy with a long-term perspective is operational competency. Operational competency directly affects performance.

However perfectly the planning work is done, the stages of putting the plans into practice are critical. When one moves from the planning phase to the action phase, one comes face to face with the business's realities. To reach the planned goals, managers have to use business resources — people, machines, materials, raw materials and information technologies — effectively. Effective use of resources will also raise business performance. Thus, as a more productive business, high performance can be reached. Here, it is as important that those managing the resource are competent as it is that the business's resources and systems are new, state-of-the-art, high-capacity and high-quality. What is more, however perfect a business system is designed, if the competency of the human factor operating it is insufficient, it is not possible to speak of success in that business.

For this reason, while strategies are being set out at the long-term planning stage, the business's current performance — and the best performance it could reach — must at the same time be analyzed meticulously. With this analysis, the adequacy of resources in quality and quantity, and the requirements, will have been determined. And meeting these requirements in a way that will fulfill the business's goals is an important point business management must focus on.

Otherwise, the business cannot reach its goals and, as a result, management is declared unsuccessful. In periods when such outcomes occur, the bill for the failure is usually presented to certain managers. Planners blame implementers, and implementers blame planners. In fact, in planning and implementation there is teamwork, and it is a necessity. If there is failure, it belongs to the entire management team. Just as with success… While planning, realistic and attainable goals should be set out with a participatory approach, with operational competencies in mind.

With the setting of business goals, employees' work goals must also be organized to serve the business goals. To this end, a performance management system that measures operational competency and develops it should be created.

The performance management system, on the one hand, ensures the business's goals are realized through employees' contributions; on the other, it aims to evaluate employees' contributions on the way to the goals with a fair, systematic and measurable method, and to support personal development by creating a motivating work environment.

Through performance evaluation, the work or abilities of the business's employees within a given period are evaluated systematically, from many angles, against a predetermined measure, and their development potential is revealed.

The performance management system is a goal-setting system that ensures personal goals align with company goals, while also containing a control mechanism aimed at ensuring work is done better. The reports created at the beginning and end of the period to be measured are tools that increase management's effectiveness.

Considered in terms of sales — the main function in the plumbing and construction materials dealers' sector — the performance management system can provide the following benefits.

First of all, the performance management system allows the training and development areas the salesperson needs to be identified. It contains a mechanism to support salespeople in performing better. It also offers an environment in which the manager can share their thoughts about the salesperson transparently with them and give the salesperson the necessary warnings. Recording these systematically creates a history in the salesperson's performance records. This system, which records and tracks the salesperson's development and progress, also provides input into promotion and incentive systems.

The performance management system is a system that, with the understanding that "the one who does the job best knows it best", ensures valuable knowledge about the work is conveyed to the manager… When good communication is established between manager and salesperson about work expectations and results, improved methods, new ideas and opportunities are created.
However, performance evaluation must be carried out objectively. Realistic work goals and performance indicators must be defined. In this way, salespeople know how they are doing the job and feel no hesitation while carrying out their duties. Otherwise, a poorly defined performance system pushes salespeople into anxiety about whether they are on the right track in their work. And this brings failure with it.

For this reason, performance meetings should be held regularly between salesperson and manager, and they should be recorded. These performance meetings should contain clear messages and requests about what the quality of the work is. Training managers, especially in how to conduct performance meetings, will increase the system's effectiveness.

With a fair performance management system, rewarding successes and setting pay standards will be even easier.

The performance management system we have discussed using salespeople as an example can be generalized and applied to all employees. Applying this system effectively means the business's corporate goals are broken down into individual goals and success is achieved.

Author: Atakan Genç