Performance management is often a challenging area for employers, and many organizations never think they are doing it as effectively as they could be. The truth is that most aren't. Performance management is a lagging area at many organizations, but nonetheless, it's a vital process that should be continuously improved upon in the workplace.
With end-of-year reviews approaching, here are five questions to consider when evaluating whether your performance management process needs a tune-up.
1. Are you measuring performance accurately?
Performance can be measured in a number of ways—usually ratings on competencies and behaviors, specific performance objectives or goals, and/or performance metrics. Whatever measurement is used should accurately reflect the performance and job of the individual, what is truly required to be successful on the job, and the results that the business needs most.
Signs that performance isn't being measured accurately are complaints of unfairness or inaccuracy (i.e. the factors assessed are different than one's job, the metrics are unreasonable, etc.), lack of differentiation in ratings among employees, perceptions about a lack of accountability, and inconsistent ratings (such as high ratings overall but lower ratings on performance factors).
2. Are you setting clear expectations upfront?
In an effective performance management process, employees know what is expected of them early in the performance cycle. They know what specifics they will be evaluated on and for what they will be held accountable. They understand what you expect to be top performance in terms of demonstrating certain behaviors and meeting certain standards. Expectations are clear, fair, and consistent.
Performance planning sessions held at the beginning of the year are an ideal way to ensure that clear expectations are set. In addition, managers should emphasize and reiterate these expectations throughout the year and explain how to meet them.
3. Is the performance management process being executed properly?
In an ineffective performance management process, managers typically conduct and submit untimely performance reviews and are inconsistent and/or ineffective in their approach of managing performance. This often occurs because they lack training on how to deliver good performance management, a supportive and efficient performance management process to work within, and/or are not held accountable for performance management.
Execution primarily lies on the manager's end.
For example, a 2013 study by Mercer found that the top driver of successful performance management was strong people management skills—specifically setting employee goals, providing feedback, evaluating performance, and linking performance to talent management decisions.
In addition, the performance management process can be disconnected from other talent-related activities (such as development, staffing, compensation, etc.), and sometimes even the business needs and objectives. In a well-executed process, on the other hand, performance management is integrated with other talent-related functions and supports the business goals.
4. Are employees receiving meaningful feedback?
Mercer's 2013 Global Performance Management Survey also reported that just 3% of organizations find their overall performance management system valuable.
An effective performance management process ensures that all employees receive meaningful, constructive, specific, and regular feedback on their job performance—not just once a year at a performance review meeting. Managers need to invest time in providing employees with good feedback on an ongoing basis—ideally immediately after completion of an assignment since that's what most employees desire. This consequently makes the year-end discussion much less uncomfortable and surprising.
The primary goal of performance management is to help employees enhance performance. Without quality coaching and feedback, and periodic discussions about performance throughout the year that give employees specifics on what exactly they are doing well and what they need to improve upon, the likelihood of performance being improved and developed is minimal.
5. Is the performance management process drudgery?
Too often performance management is perceived as drudgery. It's administratively heavy, uncomfortable and time-consuming for managers, and lacks value for many employees. When the process becomes drudgery versus an engaging experience, it's time for a tune-up and revamp.
A 2013 study by Globoforce found that those employees who enjoy reviews and view them as accurate are more likely to report job satisfaction.
In the survey, employees overwhelmingly seemed to see development and growth as the top goal for performance management, and view recognition, peer feedback/feedback from others, and more immediate feedback as more desirable facets of performance management that would make them feel more engaged and motivated in the performance management process.
Performance management at its best can be an extremely engaging process for employees and managers alike if done well. It can serve as a dialogue for career development, performance enhancement, recognition, and relationship-building between a supervisor and employee. But, the process must be designed with all of these components in mind.
All performance management processes need to be looked at from time to time to make the process better for everyone involved, and these five questions will help you determine common problem areas where your performance management process may be falling short.