When studying the relationship between employee welfare and organisational performance, a critical theory is the Theory of Performance (ToP). According to the proponent of this theory (Elger, 2007), the Theory of Performance was developed along the lines of relating six foundational concepts to form a framework that can explain individual and organisational performance and performance improvements.


The theory in its entirety focuses on the fact that the idea of performance centres on producing valued results. Hence, a performer can be an individual or a group of people engaging in a collaborative effort that moves an organisation forward and helps it deliver on its stated objectives. Given the COVID-19 situation that the world is faced with, performance has become an essential discussion among business leaders. Why? Surviving and thriving in a post-pandemic world can be challenging for an organisation if people do not perform at their best. Hence, organisations should view performance as a journey and not merely a destination.


On the back of this, organisations must develop methods and tools that will help identify and ramp up the performance of individuals and organisations in their growth journey.


The theory of performance states that the current level of an individual or organisation depends holistically on six key components:

  1. Context
  2. Level of knowledge
  3. Levels of skills
  4. Level of identity
  5. Personal factors
  6. Fixed factors


These six components work together to build a symbiotics relationship between employee welfare and organisational performance. Three hypotheses are proposed for practical performance improvements: performer’s mindset, immersion in an enriching environment, and engagement in reflective practice.


With appropriate performance measures in place, organisations can experience the following benefits:


  • Quality increases: results or products are more effective in meeting or exceeding the expectations of stakeholders.
  • Cost decreases: the amount of effort or financial resources to produce a result goes down; the amount of waste goes down.
  • Capability increases: the ability to tackle more challenging performances or projects increases
  • Capacity increases: ability to generate more throughput increases
  • Knowledge increases: depth and breadth of knowledge increases
  • Skills increase powers to set goals, persist, maintain a positive outlook, and improve application and ineffectiveness.
  • Identity and motivation increase: individuals develop more sense of who they are as professionals; organisations develop their essence.


When individual and team performance is improved, the organisation is better for it. At pcl. we have been helping organisations improve performance for over 28 years. If you would like us to work with you to ramp up the performance of your organisation and increase your profits with a people-focused perspective, kindly send us an email via people@phillispconsulting.net


Written by:

Joshua Ademuwagun

Head of Advisory, People Transformation