Definition of performance management
If you’ve ever participated in an employee appraisal or held a strategy meeting between an employee and a member of management, you’ve experienced performance management. But while these are credible examples, the reality is that performance managements goes far beyond the one-on-one meeting with the boss.
Performance management is a set of processes that aim to develop an employee so that he can perform his job effectively. It depends on ongoing communication between the supervisor and the employee to support the achievement of the organization’s strategic purposes. The purpose of performance management is to improve employee performance in constructive and lasting ways ; it is an ongoing process that, when used correctly, can lead to continuous improvement.
What Does Employee Performance Management Include?
As mentioned earlier, a performance management solution is not restricted to annual performance reviews; it is a system that expands throughout the period of employment of an employee with the company. In this way, performance management includes every interaction that management has with an employee, at every stage of the employee’s journey. The ideal is to turn all these interactions into a positive learning opportunity.
Components Of A Performance Managements System
Performance managements systems can take many forms, and yours will likely be unique to your company’s values, culture, and goals. However, most of them follow a similar structure. These are the common components/actions of a performance management system:
Create clear job descriptions
Recruit qualified candidates
interview candidates
Hold an additional meeting with candidates and test them to determine strengths
Select the most qualified candidates based on ability and cultural fit
Expand job offers to qualified candidates and negotiate terms of employment
Welcome new employees to the company
Guide and integrate new employees into the company and culture
Negotiate standards based on performance and achievements
Offer additional training and education
give direct feedback
Hold regular discussions about performance development
Create employee recognition and reward systems
Offer promotional and career development opportunities
Assist in exit interviews to determine cause of termination
What is Performance Management Not
Performance managements is not a single event or a single tool. It is not an employee review, survey, or self-assessment, and it does not match the technologies that exist to promote better performance. Performance management is bigger than that; it encompasses and includes a number of actions and their associated features, but in itself it is a process that continues to have an effect throughout the employee’s journey.
Why Is Performance Management Important?
For an organization to be successful, it needs to have a clear idea of what its employees are doing. Without this knowledge, it is much more difficult for management to guide employees and direct their efforts accurately. Performance managements creates a system designed to establish roles and responsibilities, recognize individual strengths and weaknesses, communicate feedback, reward exceptional behavior, and foster continuous innovation. In short, performance management is important because it gives teams and individuals the support and feedback they need to perform at their best.
Benefits Of Effective Employee Performance Management
Performance management exists to optimize employee performance; therefore, it naturally delivers all the benefits provided as a result of having a workforce that is reaching its potential. This includes increased productivity and revenue. But more specifically, performance management helps solve three serious problems faced by most organizations:
Engage Employees
If your organization prefers to conduct employee assessments and reviews annually, you may be waiting too long to provide essential feedback. Unfortunately, trading without feedback tends to negatively affect commitment.
More regular and consistent communication and training improves employee engagement; this, in turn, has a positive impact on absenteeism, turnover, safety incidents, product and work quality, and the customer experience.
Keeping The Best Talent
Employees who feel as if they are working in a vacuum, with no feedback or real development, are less likely to remain personally committed to an organization. On the other hand, organizations that have frequent discussions to assess performance, create solutions and provide training enjoy greater employee loyalty.
Basically, because employees see that you are willing to invest more time and effort in them, they are encouraged to put more effort into your organization. This means they will be more likely not only to stay with the company longer, but also to continually work to improve their performance.
Develop Internal Leadership
Recruiting external agents into leadership roles can be expensive and time-consuming, and if the new hire doesn’t fit in well with the company’s culture, all that investment could end up being wasted. Promoting proven in-house employees to leadership roles reduces much of this risk.
Through effective performance management, you can prepare your best employees for future managerial roles by providing training and feedback designed to help them develop the right leadership skills.
Basics Of Effective Employee Performance Management
Performance management can and should be tailored to your organization’s specific needs. However, successful businesses have identified several building blocks that help contribute to management success. These elements are:
Recruitment And Hiring
While many would argue that performance managements only starts after an employee is hired, the truth is that clearly identifying objectives before you even post a job opening is critical to ensuring you are preparing future team members for success. Promoting effective managements at this stage involves creating clear job descriptions and using an employee recruitment plan that identifies the selection team.
Integration
Rather than waiting for employees to fully settle into their roles, be sure to incorporate managements into the onboarding process. It is in the first few days and months in a new role that an employee will be introduced to the people and processes they will work with.
Definition Of Goals
The sooner you can set goals, the faster a new employee can start improving performance. Bring employees and their supervisors together early and often to negotiate performance requirements and standards, results and achievement-based measures.