When speaking of performance management, many think of the annual performance review process. But the annual performance review or appraisal is only a small component of employee performance management.
Employee performance management goes much further than the traditional annual review. It involves regular purposeful interaction between management and employees that is focused on job performance as well as direction and support for the employees.
According to Gallup, organisations that successfully engage their customers and their employees, experience a 240% boost in performance-related business outcomes compared to an organisation without engaged employees or engaged customers.
Performance management defines your interaction with an employee at every step of the way in between these major life cycle occurrences.
According to the definition provided by Michael Armstrong in his Handbook of Performance Management,
“Performance management is the continuous process of improving performance by setting individual and team goals which are aligned to the strategic goals of the organisation, planning performance to achieve the goals, reviewing and assessing progress, and developing the knowledge, skills and abilities of people.”
Note how he mentions that performance management is a continuous process — not an annual event.
A performance manager should, therefore, bring together different, integrated activities to form an ongoing”performance management cycle”. Ideal performance management should make every interaction opportunity with an employee into a learning opportunity.
We have put together some tips for optimising your employee performance management system.
As you develop a performance management program, you need to understand what you want to accomplish from it. Ask the following questions to define your goals:
If you know what you want your program to do, it will be easier to build it to accomplish that goal.
Now that you have set your goals, develop a performance plan to go alongside. Develop short term goals. As long term goals can overwhelm the employees even before they start.
Review employee performance regularly. Use metrics and analytics to track how goals are progressing. This will keep the process transparent and allow you to support your employees, whenever necessary.
During the feedback sessions, tensions can arise if the feedback is not constructive and actionable. It is not very helpful for employee morale to blame and point fingers. Instead performance manager should guide employees towards future success.
Managers should make sure to keep feedback professional and remember to focus on behaviour, rather than characteristics.
Ask employees to provide feedback for each other. This will give the performance manager a more holistic view of employee performance. It will also help them understand the challenges that teams are facing, and be able to better offer feedback.
Related: How to Manage Results vs. Efforts and the Communications Gap - FREE Ebook!
Regular coaching can help identify and solve problems before they get out of hand. Monthly or quarterly meetings should be held to help keep employees on the right track. It also helps to organise cross-functional coaching sessions. This helps employees - and managers - understand what other departments do and operate.
It is easy to assume for the management that problems are always caused by employees, but that simply is not the case. Problems can come from various external factors such as availability of supplies, internal processes that are causing issues, or organisational policies. Seek out the other source of problems as precisely as you can in order to fix them.
You cannot expect employees to stay motivated if their achievements are never rewarded. Yet, many organisations overlook this key element. Make sure that employees are not only compensated but also recognised for their hard work. You can rest in peace that they will continue performing for your organisation.
Make sure that your organisation has shared values and cultural alignment. A sense of shared goals, beliefs and expectations among employees creates a pleasant workplace. And a harmonious workplace is good for productivity, positivity and eventually better performances.
In conclusion...
We can all agree that performance management has a significant benefits for employees and managers, as well as for the company as a whole.
For any Human Resources department, performance management is an important system for onboarding, developing and retaining employees, as well as reviewing their performance.
If you are a performance manager or human resource manager it may seem overwhelming to keep up with the entire process. But there are tools to make your life easier at work.
Simple Strata can help you align your entire employee performance management strategy.