When organizations practice purpose-driven performance management, which includes components of direction, dialogue, inclusion, relevancy and mission, they tend to find improved success. In fact, a new study from the Institute for Corporate Policy finds that organizations survive on consistent, positive and sustained performance among their employees, and that performance is driven by accomplishing the employer's mission.

Regarding direction, if a company aligns its goals with the skills of its work force, it can better execute its strategy to attain corporate goals, says Donna Parrey, senior research analyst of i4cp. Top companies typically support a company-wide focus on performance management, alignment between skills and goals, and a system for feedback to discuss accomplishments and development plans.

"The performance management process helps to identify weaknesses that might prevent a company from achieving its current goals or from pursuing future initiatives," Parrey says. "It also identifies the strengths a company can leverage for achieving overall business goals."