Every organization needs to have a performance management system in place
Imagine a workplace where employees are doing some random tasks to please their managers, and managers don’t know how to approach employees who are performing poorly. What a stressful workplace it is! That’s why every organization needs to have a performance management system in place.
What is performance management?
A corporate management tool, performance management helps managers in monitoring and evaluating employees’ work. It aims to foster an environment where employees can perform tas best as they can to deliver the highest-quality work in the most effective and efficient way.
Programs for managing employee performance use traditional tools such as setting and measuring goals, objectives, and milestones. They also seek to determine how effective performance looks and create processes to measure performance. However, rather than using the year-end review model, these programs turn interactions with an employee into learning opportunities.
Managers can use tools to tweak the workflow, propose new action plans, and make other decisions that will enable employees to attain their objectives. It also helps the company achieve its goals and optimum performance, according to Investopedia.
What are the key elements of performance management?
To help you make sure that your organization is in good condition, TechFunnel suggests including the following elements when building and maintaining an effective performance management system:
Compensation and reward
Every employee deserves compensation and reward for the time and effort that they have invested to serve your company. Take note that monthly salary doesn’t count as a reward, especially if it’s similar for all employees on that level. After promotion, bonus is the next most effective performance booster.
Manager reviews
It’s vital to understand managers’ relationship with their employees, especially because managers oversee different departments. By letting employees review their managers, you can evaluate the managers’ performance level, leadership style, and influence more easily and give someone with the right qualities the role of leading a team.
Succession planning
This is a real situation that employers should prepare for: Employees don’t work in the same company or position forever. Some of them leave the organization, while others are promoted. Thus, it’s a must to build a succession plan for transferring skills from one employee to another to cover any gaps in the interim.
Monitoring
It’s crucial to track employees’ performance because it’s likely the only way to determine where improvements should be made. You can also have employees monitor their own performance, as it will inform them if they are too hesitant and, in turn, enable them to improve.
Goal setting
Every organization has targets to meet. Often, employees understand the expectations of them, as most of them are professionals who have learned the specific skills needed for their position. Without an understanding of the company’s goals, all your employees’ skills and knowledge could be worthless. Employees are usually the ones setting goals while the managers are the ones implementing them to ensure that everyone remains true to their word.
Ongoing feedback
If you want to secure a supportive and well-rounded HR department, always ask for employees’ feedback. Continuous feedback will help you avoid facing unexpected issues and know if employees have any development needs that will boost their performance.
Outcome management
It’s not 100% guaranteed that the best employees will do the job. The outcome can go both ways, and you must prepare to manage both. Paying employees based on their performance is a proper way to manage outcomes. If employees know that they can earn much more when they work harder, it will enhance their performance.
How do you implement performance management?
To help you succeed in executing your action plan, Rise People shares the following tips:
Evaluate your existing process
Consider your organization’s mission and needs and identify what you want to achieve that can be supported by performance management.
Seek advice from key players
To be able to implement a new process successfully, there must be a collaborative process among leaders, managers, and employees. As such, it’s essential to ask key players – including the senior management and other decision-makers across various departmental units – about their vision of your organization’s performance management.
Communicate your new process and strategy
It’s crucial to have a communication strategy in place to get everyone in your organization on board with your action plan. As employee interest decreases, the success of the organization-wide strategy will be harder to achieve. When implementing the changes, make sure to set a target date and train managers and employees for it.
Monitor the progress
Keep track of your employees’ progress on their goals and motivate them to monitor their progress themselves. Managers need this information to recognize and reward success, as well as to review productivity so that they can step in with assistance, coaching, timeline adjustments, or other resources if needed. This information is particularly useful during the appraisal process, as it keeps management abreast of the necessary steps to reach a goal or highlight past and present successes.
As such, it’s essential to secure the touchpoints between department managers and the employees reporting to them. Technology can make this process convenient for everyone.
Assess the effectiveness of the new process
Identify whether the new process improves performance, yields the expected results, and contributes to your organization’s overall success or not. Based on what’s working and what’s not working, fine-tune, enhance, and communicate any performance management-related progress and timeline changes.
