Employee Performance Management in Non-Profit Organisations: An Integrated Strategic Human Resource Management Perspective

Abstract

The non-profit sector increasingly operates in highly resource-constrained, donor-driven, and accountability-intensive environments that require effective employee performance management (EPM) to achieve sustainable organisational outcomes. Despite the growing importance of human capital in delivering social value, many non-profit organisations continue to rely on fragmented performance management systems that inadequately integrate employee development, strategic alignment, performance feedback, and organisational learning. This study examines the influence of employee performance management practices on organisational effectiveness in non-profit organisations. Drawing upon Goal-Setting Theory, Social Exchange Theory, the Resource-Based View (RBV), and the High-Performance Work Systems (HPWS) framework, the study conceptualises employee performance management as a strategic capability that strengthens employee commitment, productivity, service quality, and mission achievement. A sequential explanatory mixed-methods design is proposed. Quantitative data are analysed using Partial Least Squares Structural Equation Modelling (PLS-SEM), while qualitative interviews provide contextual explanations of the empirical findings. The conceptual model proposes that performance planning, continuous feedback, performance appraisal, employee development, and reward recognition positively influence employee performance, which subsequently enhances organisational effectiveness. Leadership support and organisational culture are further proposed as moderating variables. The study contributes to strategic human resource management literature by extending performance management research into the non-profit sector and provides practical recommendations for strengthening employee accountability, donor confidence, and sustainable organisational performance.