Performance Management

Meeting employees for quarterly or biannual performance reviews. These informal meetings help managers accurately assess employee progress, achievements, and performance.

Identify objectives that are impactful and link clearly with overall business plans. Make sure that they are relevant to the job the employee is undertaking and make sense within the wider business.

Treating employees with respect and empathy encourages open, frank and productive discussion. An employee who is given unhelpful, negative feedback will not be receptive to changing their approach. Managers should clarify misunderstandings, set expectations and coach employees through difficult periods.

Managers must have the skills to engage their employees in discussions about their performance. The way that they interact with employees will either inspire or disengage them. Training managers how to impact positively is crucial.

Regular conversations foster trust and don’t allow misunderstandings and problems to build up. Short, informal feedback meetings provide employees a measure of their performance and how well (or in some cases poorly) they are performing. 

A performance management system that empowers employees to meet their potential should be a core process in every business. Regular feedback, support, and direction enables employees to deliver their own work effectively and contribute to a thriving, positive work culture where meeting objectives is seen as the norm.

Generally the key elements of performance management are similar across different organisations and sectors but there isn’t a single best approach. There should be sufficient flexibility within the system to account for the different ways teams or functions operate and each organisation will need to develop practices that are relevant to their specific context, their organisational culture and the environment that they operate in.

Performance management is not a one off event but should be seen a continuous cycle, integrating a range of HR activities within an overarching framework to ensure the different elements work together.

Managers should ensure that the organisation’s top level strategic plan is the starting point, which will help to determine team priorities. Individual performance targets and development priorities will generally flow from these. Action plans can be drawn up to monitor performance, with key milestones and timescales to ensure that progress is measurable. Feedback and progress reviews should be regular, and may be supported by periodic formal performance reviews, and learning & development planning in support.

It may be desirable to set SMART targets, but sometimes objectives focused on behaviour or learning imperatives can be just as effective.

All employees are different, and the way that they react to feedback is an important factor in determining how they engage with performance management process and whether it improves performance. The individual’s personality and their ability to handle frank feedback will play an important role.

Employees need to trust that they will be engaged in a fair and participative process that is flexible enough to take account of any changes that may arise which impact on their ability to deliver and is not just a tick box exercise. 

Having remained a management tool staple for many decades, employers have started to question their reliance on appraisal and are looking to adapt their approaches to performance management. An increasingly held view is that traditional performance management practices such as annual appraisal are insufficient and need supplementing with more flexible approaches.

Effective performance management provides managers with an opportunity to manage underperformance and should ensure that it is easier to identify problems at an early stage. Often this will enable issues to be rectified quickly and employees can be supported to get back on track.

Where problems are more severe, the performance management process will give relevant information to managers and allow them to move more easily into other HR processes such as capability procedures, occupational health support or disciplinary proceedings.

The purpose of performance management should always be clear. Using performance data for pay purposes can be legitimate but the convergence of pay and performance processes needs to be handled carefully. An organisation wishing to implement performance related pay will need a clear and coherent pay procedure setting out how individual performance will be assessed for pay purposes.