In this post we will provide a definition for Performance Management and guidance as to how to ensure it is used effectively.
What is Performance Management?
“A process which contributes to the effective management of individuals and teams in order to achieve high levels of organisational performance. As such it establishes a shared understanding about what is to be achieved and an approach to leading and developing people that will ensure it is achieved”
Three ways to ensure Performance Management is effective:
Ensure your performance management system is aligned to the business strategy.
In measuring employee performance, its important that any individual objectives be aligned to those of the business. We need to feel that we’re making a useful contribution. We can do this by making a clear link between performance and the success of the business.
Everyone has a part to play in making performance management a valuable component of the businesses success.
Firstly there are the Organisational Responsibilities:
- Ensure a culture of performance management can flourish. Encourage feedback across all employee levels and celebrate business, team and individual success.
- Make certain that performance management conversations at all levels are a priority.
- Use storytelling as a method for sharing performance management success. Role modelling, particularly by those at the very top of an organisation, sets the tone for sustainable success.
- Keep employee remuneration conversations separate from the performance management. They dilute the actual ‘performance’ aspects of the discussion and risk any meaningful feedback being lost in a battle over money.
Then there is the Line Manager Responsibilities:
- Work with employees to agree SMART objectives that contribute towards delivery of the overall business strategy.
- Use any rating systems fairly and consistently.
- Effectively differentiate performance using evidenced examples.
- Commit to regular ‘great’ conversations with employees that are both formal and informal in nature.
- Translate feedback into action through clear development plans which then form the basis for ongoing conversations with your employee.
And finally the Employees’ Responsibilities:
- Work with your line manager to agree SMART objectives that contribute towards delivery of the overall business strategy.
- Rate your performance, based on your overall contribution, honestly and consistently.
- Provide examples of how your performance has differentiated you from your peers using evidenced examples.
- Take responsibility for contributing fully to a great conversation with your line manager around your overall performance.
- Take feedback in the right way and translate into action by agreeing clear development plans.
Focus on the ‘how’ as well as the ‘what’
If performance management is to be effective it needs to make a sustainable contribution to business productivity. To achieve this it is critical that the behaviours an individual displays when completing a set objective are equally as important as the delivery itself.
Behaviour, in relation to performance management, can be defined as:
- How a person conducts themselves in a role
- The action or reaction of someone under specific circumstances
- Observable activity
Performance management is often criticized by organisations and employees alike. In a culture where great conversations flourish however, it can have a significant impact on things like productivity and retention.