Impact of performance management system on organisational performance of higher education institutions : a case study of Pakistan

Higher education institutions (HEIs) are constantly striving for better quality and effectiveness with a paucity of resources, while simultaneously expected to exhibit greater transparency and accountability in their procedures. Academic institutions are facing challenges of restricted funding and severe competition in the current dynamic environment which is creating the need for more effective and efficient utilization of human capital in possession. This study explores the impact of implementation of Performance Management (PMS) on organisational performance in Higher Education Institutions (HEI) of Pakistan. Several reasons make this sector particularly important for this examination: Firstly, Pakistan is a developing economy and in severe need of highly skilled manpower to develop a strong economy. Higher education institutions play pivotal role in this human development. Thus, effectiveness of performance of faculty members of these institutions is very important. Secondly, the implementation of performance management systems is likely to be one of the revolutionary changes in HEIs. Finally, the uses of PMS in HEIs will provide us with a better understanding of its impact on organisational performance. Therefore, this study aimed to explore the impact of Performance management System in HEIs, and how this use of PMS contributes to the employees’ performance and Organisational Performance. An interpretive approach is used to answer research questions and to explore the implementation of PMS in depth by using qualitative data collection methods. The data subjects were faculty members from business schools of the chosen HEIs. A thematic analysis has been done with the help of NVivo software to analyse the semi-structured interviews. This research contributes to the body of knowledge in relation to the impact of performance management system on the organisational perfroamnce of HEIs in general and more specifically in context of Pakistan. Findings of this research has highlighted the critical issues regarding how performance is managed, evaluated and reported by the HEIs in order to control and organize the dynamics that influence the output of HEIs in Pakistan. Moreover, this study contributed that organisational culture have strong influence on the implementation of PMS in higher education institutions in Pakistan