Implementing a performance management system usually involves establishing standards for behavior on the job. This includes both individual and team work. Managers should solicit input from peers, superiors and customers to gain insight on performance on individuals. They also should measure and reward team activities and results. By discovering how well employees are currently applying their skills and achieving goals, managers provide future direction.

Individual Criteria

An individual typically meets annually with his manager to establish goals for the coming year. By establishing a clear performance improvement plan in specific, measurable, attainable, realistic and time-constrained terms, the manager sets a clear path. The manager helps the employee link his personal goals to the company’s overall strategy plan. She identifies training courses, workshops and self-paced materials that allow the employee to develop needed skills. Then, she evaluates his progress toward achieving his goals as the year progresses.

Team Criteria

A project manager typically establishes a comprehensive project plan at the beginning of the project. This defines the project purpose, deliverable requirements, assumptions, risks, budget, resources and milestones. Checkpoints may be scheduled so that sponsors and stakeholders can evaluate the team’s quality management strategy and productivity. When milestones and other criteria are met, such as quality and quantity, the project manager rewards the team with recognition, bonuses or other financial compensation.


Traditionally, employees have been evaluated on an individual basis. An effective performance management program assigns accountability to each employee. By providing continuous feedback, distinguishing levels of performance, rewarding good performance and addressing poor performance, managers ensure they have the right employees in the right place at the right time. On the other hand, by evaluating an entire team’s performance, the whole team’s activities come under scrutiny by the project manager or other superiors. Team dynamics, such as effective communication, decision-making and cultural awareness, get evaluated by both the team members and sponsors and stakeholders.


Historically, individual evaluation leads to promotions, bonuses, salary increases or promotions. Rewarding teams in the same way may result in some employees feeling demoralized and working more than their peers. On the other hand, reaching for a common goal motivates and inspires a team to achieve strategic goals. Leaders differ their strategy for guiding individuals versus teams based on skill levels and experience. By taking an autocratic approach and making all the decisions regarding performance evaluation, both individual and team, a leader tends to discourage creativity and innovation. By taking a democratic approach and including both individuals and teams in the decision-making process, he fosters a more positive atmosphere for performance evaluation.