Human resource development (HRD) for performance management

Purpose - A firm's competitiveness depends on its capacity to manage performance and improve the development of the skills and competencies of employees – creating a learning environment. Although the Nepalese economy has embraced an open market policy and is attempting to join the global market, competitive advantage is being hindered by a failure to address human resource development (HRD) and by poor performance management (PM) practices. This paper seeks to address this issue. Design/methodology/approach - The research article raises three research questions: What is the concept of PM – how does it relate to HRD? What is the PM and HRD context and what are the associated issues in Nepalese organizations? and How could new structure and roles improve HRD for PM? In order to answer these research questions Anglo‐Saxon and Nepalese literature is reviewed. Findings - In order to manage PM in Nepalese organizations a clear link between organizational objectives and outcomes should be established by developing a human capital base in organizations. HRD professionals help to integrate HRD functions and organizational objectives by creating a learning environment. Research limitations/implications - The study is not survey‐based and thus information is largely collected from published literature rather than perceptions of employees, management and labour unions and the authenticity of the prescribed four‐column‐model is yet to be tested. Originality/value - A four‐column model comprising HRD and PM context, PM issues, HRD issues, and the new HRD structure and functions is developed and can be used as a framework for undertaking future research. This framework is the main contribution of the paper.