The link between key performance areas and organisational strategy.

Abstract

In the global market, the lines between pioneers and followers are immensely blurred, industries are fraught with intense competition and products versus price have since lost the competitive edge. These trends have made it difficult for organisations to meet their strategic goals and have made it necessary for organisations to revisit their strategies far more regularly than in the past. In this economic era, people have become the focal point of differentiation – organisations have come to realise that it is the calibre of people employed that will assist in the efficient realisation of long and short term strategies. Accordingly, organisations have spent exorbitant amounts of money investing in performance management systems that promise to utilise the organisations human capital to the maximum in order that the strategic goals of an organisation are met. The aim of the study is to investigate the link between key performance areas and organisational strategy, to evaluate whether performance management systems are utilised as optimally as it should be to create competitive edge in changing market conditions. The sample comprised 155 respondents, of which 51 were valid responses. The research study showed that South African organisations, more specifically in KZN, make use of performance management systems to implement the corporate strategy. Some of the responses indicate that these performance management systems are not correctly implemented and the measurement of key performance areas is a mere formality in certain organisations as opposed to a sincere measurement of whether employees are meeting the objectives of the workplace. It has also been found that the strategy of the organisations remains at top of the hierarchy and does not filter down to the base. Based on these findings it is recommended that managers redress their view of performance management systems and key performance areas to ensure successful strategy implementation and execution.