The PMS is appropriate in the organization: The audit must verify whether the PMS is suited to the organizational philosophy and culture.
The PMS measures performance in the manner that is desired by the organization: Does the PMS measure all aspects of performance in a proper manner? Are there weightages given to different aspects of performance?
It motivates employees as it is expected to: A good PMS would encourage and motivate employees to produce better results and exhibit better performance.
It meets the objectives for which it was designed
It is appropriately linked to the compensation and reward system: Good performance must be rewarded and bad performance must be penalized. The audit must ensure that this happens.
Promotions are based on the PMS: If this is so, then is it fair and properly carried out?
The right people get the reward or penalty: The audit must ensure that the right people get the credit for good performance and those responsible for bad performance are the ones who are taken to task. The audit must ensure that good performers are not being penalized for something that they have not done, nor should anyone get credit for work that someone else has done.
It has in-built equity or it supports biases: This is a very important aspect of the PMS, which must be verified by means of an audit. Similar work by people in the organization should be rewarded or penalized equally. Fairness of the PMS is an essential aspect of the PMS, which must be safeguarded.
It is perceived as fair and just by the employees: This may be done by means of survey in the organization. The PMS may not be fair, but if the employees perceive it as fair, or are happy with how the PMS is presently, it serves the purpose.
If the PMS is based on goal setting, are the goals set in an appropriate manner: In some organizations, MBO is practiced. In such cases, an audit of the entire MBO system will be required.
The superiors know how to assess their subordinates: This is again a very important aspect, since a PMS, if not properly implemented has little meaning. The audit must verify whether adequate training is available to superiors on how to assess their subordinates, what aspects of their performance must be considered and which must be ignored, how to eliminate biases at the time of appraisal, etc. Also, the audit has to verify whether the superiors are competent to assess their subordinates.
Insights
