Ans. Performance management is a process in which the employees are made to work in the organization to the best level of their capabilities so that the efficiency of the tasks can be increased. It helps in taking the employee to the path of achieving the goals of the organization according to the standards that are set by the employer. Performance management is required in the organization in order to make sure that the employees identify their own skills and capabilities in order to ensure effective and efficient completion of the work by the employee. When the employees work to the best level of their capabilities, the performances of the employees are well evaluated which helps in developing the well efficient and effective reward system mechanism the organization. Performance management system helps in finding out the obstacles that are preventing the employees to work to the best level of their capabilities.