Performance management is perhaps the most important element of staff development companies can pursue. It allows employees to better understand their own skills and where they need further support, while the wider organization can gain insight into how their talent provides the most value now and in the future.
Estimating the contribution professionals can make in the next year or even further ahead is one of the best ways performance management can help businesses make decisions to prepare for the future. However, being able to accomplish this relies on an effective and well-designed strategy.
Here are six steps to help you pull off successful performance management:
1. Train managers well
A lot of companies assume their management teams will already have the skills needed to navigate any problems that may arise, but this is far from the truth. Even if they have many years of experience, the best and most effective strategies for people management is almost constantly evolving. This means it's essential that any managers are trained on a regular basis on industry standards, as well as any personal values unique to your company.
Doing this ensures you get the most value out of your management as well as the employees they are responsible for.
2. Shift away from annual appraisals
More businesses are understanding the importance of having regular meetings with employees to discuss their performance, as well as any other problems they may be concerned about. A yearly appraisal may mean less hassle for managers but it also prevents issues from being flagged up. This means staff could be underperforming or struggling in other ways for months before a manager becomes aware of it and puts measures in place to try and address it.
3. Align with organizational goals
Any performance management strategy should be influenced to some degree by the overall organizational goals. The talent within your company is the most valuable tool you have for achieving your business objectives so it's important that these are complemented by the individual goals of employees.
It also helps managers to understand how they can best help the organization succeed without having to sit in every single meeting. This guidance allows them to give their team a direction in their regular appraisals and define success.
4. Set goals for the future
The core focus of any development meeting should be setting, evaluating and developing goals. This ensures that all management personnel are constantly looking towards the future, rather than dwelling on mistakes made in the past. Of course, it's important to address these issues and find solutions to prevent them from happening again but it's not constructive to completely focus on previous errors.
You'll find that setting goals for the future that are based on skill development and boosting experience is much more likely to boost employee morale and lead to better retention in the long term.
5. Invest in company culture
As well as aligning with organizational goals, it's important that performance management strategies reflect the company culture that you are looking to create.
For example, if you want to encourage loyalty from employees, having a system that praises and rewards professionals is bound to be more effective than a complicated process that looks out for errors.
It's important that you aren't just recognizing staff who make a direct financial contribution to the company too, especially if you have retention or morale organizational goals. Businesses should be championing employees who work towards improving the company, whether through innovation or by taking charge of social events.
6. Be as transparent as possible
For any performance management system to be truly effective, you need to encourage greater transparency. Both from managers to employees and vice versa, it's important that there is open communication. This helps foster a more valuable professional relationship and ensures that appraisals are really getting to the heart of what improvements need to be made. It will also promote better engagement from employees and ensure they feel empowered to make changes in the business.