The expansion of unfair dismissal rights to all employees, initiated by the Fair Work Act 2009, has encouraged a resurgence in performance management.

As a result of the act, employers need appropriate performance management systems in place if they are considering dismissing an employee on the grounds of non-performance.

However, performance management shouldn't just be treated as a necessary step towards potential dismissals.

It can directly increase the effectiveness of businesses, improve management control and result in fresh and motivated employees, according to The El Group CEO Ben Thompson.

"When employees hear it is time for appraisal or feedback, they often get defensive," he said.

"The stigma is that generally appraisals only occur once a year and are used to measure an employee's performance over the previous year - which has probably already been forgotten.

This is an ineffective technique. Once a year reviews don't provide enough opportunities or challenges for either party."

Thompson suggested the annual appraisal system be replaced with performance management techniques that are implemented on an ongoing basis, providing feedback and developmental opportunities closely linked to the employee's and employer's goals.

"Ongoing performance management is a win-win opportunity for managers as it reinforces the goals of the business while motivating and invigorating employees as well as ensuring the employer's processes will assist them if action is taken by an employee after dismissal," he said.

Earlier this year, Andrea Boyle, HR leader, GE Energy Australia & NZ, told Human Capital that setting goals, expectations and ongoing feedback are important in driving a culture of high performance.

"We have a formal process that supports this but it needs to happen every day. Employees need to know how they are contributing and know that what they are doing is valued. When they are off track or performing under par, they need help to understand why and how to improve," she said.

"Get to know your employees - really know them.

Understand what their real capability is. Understand what their passion is and use that information to engage them. Stay in touch, read the signs, act early. Don't think that things will improve themselves in time. You need to get involved and help employees work through the issues."