Critical Analysis of Problems and Solutions in Implementing an Effective and Fair Performance Management System

In the era of globalization, companies are faced with complex challenges that affect their operational efficiency and performance. Competitiveness and innovation are the keys to a company' s sustainability in the market. One solution to improve performance is to implement a Performance Management System, which functions to track, assess, and improve individual and organizational performance. However, the implementation of a Performance Management System is often hampered by the problem of unfairness in performance measurement and assessment, where the methods used are inaccurate and tend to ignore important factors such as product quality and customer satisfaction. In addition, employee resistance is also a challenge in the implementation of a Performance Management System. Therefore, a critical analysis is needed to find a fair and efficient approach to resolving these issues. The implementation of an effective Performance Management System can contribute significantly to improving a company’s operations, making it more competitive in the global market. With the implementation of a fair system, employee motivation increases because their achievements are rewarded proportionally, which in turn increases productivity and work quality. This study aims to identify effective solutions to overcome the problems of implementing a Performance Management System so that the company can achieve its strategic goals and improve overall operational performance.