by David Pinto
Performance management enables business leaders to evaluate employee performance to ensure that company objectives are being met and employees are continually developing skills and responding to actionable feedback. However, an effective performance management system must be implemented for it to have its intended success.
82 % of upper managers say that performance management doesn't work well at meeting its goal.
What is performance management?
Performance management is the thread that connects your employee engagement strategies, compensation, and success planning to mentoring, recognition, and career development. If you do performance management wrong, it can make it hard for you to do all of the good things you're trying to do as an employer, which in turn can hurt your business.
But if you get it right, people will know what their job is, how to get there, and how important they are to the whole company, enabling employees to improve performance and improving employee retention.
95% of managers aren't happy with the review process
A formal performance management program helps business leaders, managers and employees agree on expectations, goals, and career progression, as well as how an individual's work fits into the overall vision of the company. In general, performance management considers individuals in the context of the larger workplace system. In theory, you seek the absolute performance standard, which is thought to be unattainable. Annual reviews do not provide timely feedback for improving performance since they do not give real time feedback. Therefore it does not help employees understand how to achieve goals and strategic objectives. Even more regular check ins on a quarterly basis do not give an accurate reflection of key performance indicators.
Two things can help you make sure that you're getting more value out of your performance evaluations: Do them more often & turn managers into coaches.
The different performance management process
Performance management is most effective when it is done collaboratively throughout the year in continuous performance management processes.
The coaching stage of performance management establishes the tone for the company and its employees' success. Coaching entails training and development opportunities, providing two-way feedback, and collaborating to give performance reviews to help employees improve.
If an employee still isn't meeting the position's standards after receiving coaching from their manager, the next stage of the performance management process is corrective action.
Corrective action requires the manager and employee to collaborate to identify the causes of poor performance and devise a plan to improve the situation to meet performance goals. This may be in the form of performance appraisals or performance discussions.
If coaching and corrective action fail to improve an employee's performance and the employee is still carrying out their tasks with bad performance, the employee is discharged at the end of the performance management process.
The Issue with Annual Performance Reviews
Performance management is often carried out with an end-of-year review. When only carrying out an annual review, problems occur. The process of setting up a performance review takes a lot of time, organization and planning. Thus, it can be hard to do this more than once or twice a year. But this approach puts too much pressure on those few conversations with senior management, making them both scary and useless.
If employees only get feedback once or twice a year, no matter how good or bad the feedback is, this process will not be effective. Either the issues have been solved or are in the distant past. Employees won't be able to do much with feedback that is too old, and the reviews will not be able to solve problems.
Managers can't tell their employees everything they need to know about how to improve, how their pay will change, how their careers will grow, or how they'll be promoted in one meeting.
What if we were to tell you that there are tools on the market today that can alert you if there is a cause for concern in your organization and can improve the performance management system?
ELEFense analyses company sentiment & keywords to reveal Enterprise Cultural Health and quantify how people feel to give you unprecedented insight into trends and events. This will allow frequent check-ins and allow companies to provide their employees with regular feedback and performance appraisals throughout the year.