New Approach to Performance Management

In the modern 21^st century business, performance management is no longer an issue of only internal development. The modern approach of performance management includes the development of all the stakeholders associated with the organisation i.e. the customer, business partners, vendors etc.

With the development and interference of technology in the day to day business, customers can directly access systems within the organisation, like internet banking e.t.c. Hence, customers are effectively running the organisation by choosing appropriate channel.

Most of the organisations now are outsourcing their important activities like accounting, manufacturing and R&D. Even the innovation that creates a competitive edge, are created by outsiders for the company.

As there is high level of interconnectivity among business, the performance management system that focuses on internal hierarchical growth has become obsolete concept.

Hence, as the business operates in network, performance management system should focus on all its various stakeholders. Importance should be given to the question on “How can we optimize our performance for one group of stakeholders?” This will result in the real performance growth of the organisation in modern networked business world.