Defination: higher management to make proper decissions about it







Performance manegement :
Performance manegement
is basically a hr tool.which  set the
goal ,lead the goal, and identify where the need is to be develped which
include performance appraisel.any company or organization set the performance
standards through these standard employee of the organization are  evaluated. It is also process that gives the
feedback of the also help the employee to be on the their track
toward organization goal.
Compensation Defination:
Compansation could be a conjointly 60 minutes tool that is providing
ofmonetary advantages and values
to their worker through
thevdefined and commonplace method of the corporate that may be in term of earnings ,bounesand different  packages. The organization use the
compansation system to sustain their worker for the long run and conjointly for the quality output

Roles of Compensatiom in  HRM:

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In an organization when
the company work efficiently and effectively,it gives so much benefits to company
and its employees.This can only be possible if everyone in the organization
work together and perform every task effective and efficiently.

Compensation makes the employee powerful

Comkpensation is applied on the employees according to rules
and regulations

Compensation provides justice in all the departments of the

Compensation provides different tools and sources to the
higher management to make proper decissions about it

Roles of performance in HRM:

Performance of any
organization depend on the employees.If they work efficiently and effectively
automatically performance will be boosted and growth of the organization
also.This performance is measured according to the set standards and policies
of the company.There is a very important role of performance in any

Performance managemet is important to achieve the desired set
goals and objectives of the company

Performance management provides all the status and feedbacks
of the employess

PM system evaluates the tasks performed in the organization

PM system clearly states where our employees and organization
is standing against the employees


There is a great impact
of compensation on the performance.Compensation is not only in monetory terms
there are many all other elements included in the compensation like

Medical care

Work life balance

Life and accidental assurance

Health and wellness

In this era people not
only work for the money.They want work life balance .They want to enjoy their
lives as well with their friends .If in the organization employes are not given
the proper benefits except their basic salary they will be dissatisfied at some
extent.A good compensation packages assures two important elements that is:


                A good compensation
packages  reduces the turmover rate of
the companies.As the employees are the assets of the company .To retain the
employees it’s the duty of the organizations and companies to give them the
good compensation packages  because it
will definitely affect their performance .

·       Motivation:

                            Compensation is
basically a good and foremost factor of the employees through this  employees are highly motivated and work more
harder to reach the set goals of the organization .Through this we can judge or
estimate that there is a great impact of compensation on performance .If the
compensation is good the employee will be internally motivated and think good
in every aspect for the company .This will ultimately boost up his performance
and when the performance is boosted up the company starts growing fastly.

If we talk about other aspect that
compensation packages which are given to employees are not very good and are
very dissatisfactory .This will definitely affect the performance of the
company .The two main elements which will occur after this and company
organizations face this:

Low job

                           Due to this employees
will be less satisfied from their job that they are not receiving that much
which they deserve. Slowly slowly their performance will start declining and he
will become then low performer of the organization.

Low productivity:

production depends upon totally labour of the organizations if the labour of
the company is not given proper wages they will manufacture less and company
will start going in loss .To retain this to make the performance of the labour
good so that they produce or manufacture the required quantity they must given
the right wages to them.

High turnover:

Ultimately when
the employees are dissatisfied from their job due to bad compensation system
the employees will start quiting from their jobs.When the employees start
leaving the jobs the company will suffer from loss, their works in the company
will start pending  and become the reason
of company breakdowns.

To be on safe
side companies should make effective compensation plans. Companies should have
all the knowledge that from which factors their performance will be affected
.To compete the competitors companies should have proper performance management
systems and compensation systems. Companies should have quarterly annually
appraisal systems so that they can determine 
the grey areas and once grey areas are detected there should be proper
solutions for it to overcome it.