A central factor that can determine the effectiveness of a performance management system, of course, is whether an employee’s performance is raised, thereby raising the overall performance (and profitability) of the organization.

Module 6 Critical Thinking

Performance Management

A central factor that can determine the effectiveness of a performance management system, of course, is whether an employee’s performance is raised, thereby raising the overall performance (and profitability) of the organization. This is accomplished by ensuring that the performance of an employee is directly tied to the organization’s overall strategic goals/objectives.

In this critical thinking assignment, choose any Saudi Arabian company in which you are familiar (it does not need to be one that you have worked for). Research the specific goals or objectives of the organization over the next 5 years, along with the main principles of a performance management system, and then address the following questions:

  • Give a brief review of the organization you have chosen.
  • State the 2-3 most important goals/objectives for the organization over the next five years.
  • As mentioned above, the key to an effective performance management system is to directly tie organizational goals with an employee’s specific goals. If that employee accomplishes those goals, then the organization has an opportunity (collectively) to reach its overall goals/objectives. Given that statement, choose any position you are familiar with in that organization. They develop 3 goals that the person in that position must accomplish over the next years in order to be successful in their position and, as a result, that would allow the organization to be successful. Below is an example:
  • EXAMPLE: The goal of the Riyad Bank is to increase its profit margins by 5 percent over the next two years. Therefore, one of the performance goals for the Chief Financial Officer is to develop a strategy that, when implemented, will reduce expenses a minimum of 2 percent in each of the subsequent 3 years.

If addressed correctly, students will learn, via the performance management system, to create performance standards that directly tie employee performance to organizational performance.

Your well-written paper should meet the following requirements:

  •  Be 4 to 5 pages in length, which does not include the required title and reference pages, which are never a part of the content minimum requirements.
  • Use Saudi Electronic University academic writing standards and APA style guidelines.
  • Support your submission with course material concepts, principles, and theories from the textbook and at least two scholarly, peer-reviewed journal articles unless the assignment calls for more.
  •  It is strongly encouraged that you submit all assignments into the Turnitin Originality Check before submitting it to your instructor for grading. If you are unsure how to submit an assignment into the Originality Check tool, review the Turnitin Originality Check—Student Guide for step-by-step instructions.
  •  Review the grading rubric to see how you will be graded for this assignment.

Plagiarised (DO NOT COPY)

Introduction: Performance management systems are essential for aligning employee performance with organizational goals, ultimately enhancing the company`s overall performance and profitability. This paper explores the performance management system of Saudi Aramco, one of the largest oil companies in the world, and how it ties employee goals to organizational objectives.

Organization Overview: Saudi Aramco Saudi Aramco, officially known as the Saudi Arabian Oil Company, is a global leader in energy and chemicals production. Founded in 1933 and headquartered in Dhahran, Saudi Arabia, Saudi Aramco has grown to become the world`s largest oil producer. The company`s mission is to provide reliable energy and chemicals, driving global commerce and enhancing the quality of life.

Key Goals/Objectives for the Next Five Years:

  1. Increase Oil Production Capacity: Saudi Aramco aims to boost its oil production capacity to meet growing global energy demands.
  2. Expand into Renewable Energy: The company plans to diversify its energy portfolio by investing heavily in renewable energy sources, including solar and wind power.
  3. Enhance Technological Innovation: Saudi Aramco seeks to advance its technological capabilities through research and development, focusing on sustainability and efficiency improvements.

Position Selected: Production Manager The Production Manager at Saudi Aramco plays a crucial role in ensuring the efficient and effective operation of oil production facilities.

Goals for the Production Manager:

  1. Increase Production Efficiency: The Production Manager must implement strategies to improve production efficiency by 10% over the next three years. This includes optimizing workflows, reducing downtime, and enhancing equipment maintenance schedules.
  2. Safety and Environmental Compliance: Over the next two years, the Production Manager should achieve a 20% reduction in safety incidents and ensure all operations meet or exceed environmental compliance standards. This goal aligns with Saudi Aramco`s commitment to safety and sustainability.
  3. Cost Reduction Initiatives: The Production Manager is tasked with identifying and executing cost-saving measures that will reduce operational costs by 5% annually over the next five years. This includes negotiating better supply contracts, reducing energy consumption, and minimizing waste.

Performance Management System: Saudi Aramco`s performance management system is designed to align employee goals with organizational objectives. The system incorporates regular performance reviews, goal-setting, and continuous feedback mechanisms.

Key Components:

  1. Goal Setting: Goals are set collaboratively between employees and managers, ensuring alignment with the company`s strategic objectives.
  2. Performance Reviews: Regular performance reviews are conducted to assess progress towards goals, identify areas for improvement, and provide constructive feedback.
  3. Development Plans: Personalized development plans are created for employees to enhance their skills and competencies, supporting both individual and organizational growth.

Benefits to Employees:

  1. Career Growth: Clear performance goals and regular feedback help employees understand their career progression and development opportunities.
  2. Recognition and Rewards: Employees who meet or exceed their goals are recognized and rewarded, fostering motivation and job satisfaction.
  3. Skill Enhancement: Development plans and training opportunities enable employees to acquire new skills and advance their careers within the organization.

Critique of the Performance Management System: Benefits:

  1. Alignment with Strategic Goals: The system ensures that individual performance is directly tied to the company`s strategic objectives.
  2. Employee Engagement: Regular feedback and recognition keep employees engaged and motivated.
  3. Continuous Improvement: The focus on development and improvement helps employees and the organization grow continuously.


  1. Time-Consuming: Regular performance reviews and goal-setting can be time-consuming for both managers and employees.
  2. Potential Bias: Performance assessments may be subject to managerial bias, affecting fairness and objectivity.
  3. Resource Intensive: Implementing and maintaining the performance management system requires significant resources, including time, technology, and training.

Recommendations for Improvement:

  1. Implement 360-Degree Feedback: Incorporating feedback from peers, subordinates, and other stakeholders can provide a more comprehensive assessment of employee performance.
  2. Enhance Training for Managers: Providing managers with additional training on conducting objective and fair performance reviews can mitigate potential biases.
  3. Leverage Technology: Utilizing advanced performance management software can streamline the process, making it more efficient and less time-consuming.

Conclusion: Saudi Aramco`s performance management system effectively aligns employee goals with organizational objectives, driving overall performance and profitability. By continuously refining this system and addressing its drawbacks, the company can further enhance its ability to achieve its strategic goals and maintain its position as a global energy leader.


  1. Aguinis, H. (2019). Performance Management (4th ed.). Chicago Business Press.
  2. Armstrong, M. (2021). Armstrong`s Handbook of Performance Management (6th ed.). Kogan Page Publishers.
  3. Saudi Aramco. (2023). Annual Report 2022. [Link to report]
  4. Saudi Aramco. (2023). Sustainability Report 2022. [Link to report]
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