How to get started with Performance Management

Two employees happy after their performance management meeting

In the era of instant feedback – where reviews and ratings govern many of our daily decisions – the annual employee appraisal can be considered antiquated at best.

Twelve months is a long time in business, yet many organisations operating a traditional appraisal model will happily leave it this long to provide any genuine feedback to their staff – often stunting an employee’s potential, to the detriment of both the individual and the business.

Realising the limitations of the traditional review process, progressive organisations are now implementing a more continuous approach to managing, motivating and rewarding good performance.

An approach which provides ongoing, genuine and consistent support for employee development and growth – even before they join the business.

It’s known as Performance Management. 

Much more than just a substitute term for the traditional appraisal process, Performance Management has a far broader scope. It’s a framework or system for helping employees perform well and reach their potential, through the creation of an environment in which they can thrive.

That begins with clear job descriptions and recruitment processes that help you bring on board the right people in the first place, and onboarding programmes to help new hires hit the ground running. 

Once in the job, it means a never-ending cycle of education, coaching and feedback, turning every interaction between manager and employee into a valuable learning experience and/or a chance for the employee to be heard. 

It’s this mentality that really underpins a Performance Management strategy – recognising that feedback and direction isn’t something that should happen once a year, it should be integral to your employees’ everyday experience. 

Such a shift in approach will, of course, take time to implement, but in this blog, we’ll look at how you can start taking steps in the right direction.

1 Define your objectives

Performance Management is a somewhat broad term, and no two businesses will go about its implementation in the exact same way. 

To help you define your strategy, it’s therefore important that you have clear goals and objectives in mind, beyond simply ‘helping employees do better’. 

Raising morale or boosting productivity will naturally have an impact on your business’s bottom line, but without a clear, tangible target, success may be hard to measure.

You should, therefore, look to set and document some clear objectives that can be tracked, whether that’s certain financial goals, improved staff retention numbers or increased satisfaction scores in customer service surveys.

Ultimately, your Performance Management programme should align with your organisation’s strategic goals.

2 Communicate the benefits

In aiding the development of your employees’ skill set and helping them reach their potential, a Performance Management framework can be a great thing for your staff. But it’s important to realise that employees could perceive your intentions very differently.

Workers might see the continuous coaching ethos as micro-managing, or perceive the added focus on performance as extra pressure. Similarly, managers themselves may worry about how they’ll fit more regular catch-up sessions into an already busy schedule.

Communicating your plans and objectives clearly and honestly will help people buy into the new approach. Explain exactly what changes you’re making, why you’re making them and what it means for individuals going forward.

Remember that from an employee perspective, performance evaluation is intrinsically linked to salary, so be clear on how the new ethos will affect increases and promotions. 

Indeed, if you’re moving away from annual appraisals, you can bet the first question on employees’ minds will be “When do we get our salary reviewed?”

3 Train your managers

It’s widely accepted in business circles that for a modern manager to succeed, they must be able to coach – but that’s not to say every manager has the natural ability to do so. 

If you’re asking managers to make feedback and coaching a key part of their day-to-day relationship with employees, you’ll, therefore, need to provide them with the confidence and skill set they require.

Whether through workshops or one-on-one sessions, think about how you will give your managers the training they need, and how you can use that time to further communicate the benefits your Performance Management programme will bring.

An added bonus of the training, of course, is that your managers of today will be in a better position to become the business leaders of tomorrow.

4 Take advantage of technology

Perhaps the most fundamental first step towards efficient, effective Performance Management is finding the right technology to support it.

Many of today’s cloud-based HR platforms provide built-in Performance Management functionality to help shape and support your new, improved processes – with workflows and goal-setting features geared towards managing and motivating performance on a continuous basis.  

Goal setting functions typically allow you to set and communicate goals at both company and employee level, helping to keep individuals engaged in their work by regularly refreshing targets.

Meanwhile, customised schedules and automatic reminders can help ensure that both managers and employees stay on track with more regular catch-ups.

In summary

Performance Management frameworks are already yielding positive results for adopters – encouraging more and more businesses to rethink their approach to appraisals.

Rather than put a Performance Management plan in place for the sake of it though, it’s important to set clear, tangible objectives for your programme – and monitor its success on an ongoing basis.

After all, in the culture of Performance Management, even your Performance Management programme itself can benefit from constant feedback and review…

Natural HR

About Natural HR

Natural HR is a cloud-based HR software company for growing businesses with 100+ employees. Since launching in 2010, we’ve been building a comprehensive suite of HR functionality that equips the small to medium-sized enterprise with everything needed to build an effective and efficient HR operation.

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