The complete guide to maximizing the potential of your performance management toolkit
The performance management cycle can be broken down into four key categories. These are:
These stages represent a continual process of revision, and using the correct performance management tools will make sure these processes are continually aligned with the principle goals of an organization.
Let’s take a look at these stages in more detail and see what resources you can draw upon from your performance management toolkit.
A strong performance management system not only helps in getting everyone aligned on the over-organization mission and goals but also goes a long way in building a culture of trust and meritocracy.Saurabh Nigam, Vice President-Human Capital Omidyar Network
The expression “culture eats strategy for breakfast” might be an over-exaggeration, but that doesn’t mean it isn’t of vital importance. Companies invest a great deal of time and thought into crafting a customer-facing brand that captures what matters the most about their values.
By the same token, a company’s culture should reflect clearly the values which most reflect their driving ambitions. A weak culture is akin to a weak brand: employees who don’t feel as if they are on board with organizational goals are less likely to fully commit to their roles.
Defining your mission and values
There was a time when a company’s core mission reflected practical and utilitarian values. But nowadays company cultures are rooted in deeper fundamentals that go beyond simply being known for the quality of a product or service.
A culture should also seek to enhance the overall feeling of satisfaction employees feel when in the work environment. As a report from Deloitte observes when discussing employee engagement:
“Building an environment that is fulfilling, meaningful, and fun is not only good for employees, but can also potentially result in better business outcomes, including higher productivity, increased efficiency, higher levels of customer satisfaction, and better overall business results.”
Boosting company culture
Mechanisms for promoting cultural values throughout the workforce are embedded in the architecture of a performance management toolkit. Simply customizing your performance management tools to match the themes and slogans which outline company values will positively influence an individual’s feeling of alignment.
Culture tools you can use include:
Celebrating organizational triumphs and successes and bringing attention to new company-wide initiatives are great ways to help build a sense of community in the workforce. Using a news feed makes sure this positive messaging is boosted to all employees via a performance management app.
Culture should be an ongoing conversation between business leaders and their employees. Using performance management culture feedback mechanisms allows individuals to share unique insights into what it is which makes the company special, shaping its future vision of meaning and purpose.
Determining a performance management strategy will help to determine which resources in a performance management toolkit to utilize and how. Short and long term goals may require different processes, while strategies to increase the soft skills of employees or test the waters of new working processes may require different ways of thinking.
Determining objectives at the macro and micro level
A solid performance management strategy requires attention at multiple levels throughout an organization. Traditionally, objectives are set as cascading goals from the executive level through management and down to employees.
But this method makes for poor alignment while neglecting the input from employees throughout the business means that they may end up unrealistic. Executives tend to understand their organizational capabilities, resources and management systems, but can run the risk of focusing on areas of expertise at the exclusion of others.
Macro goals examples include:
- Planning for the launch of a new product or service
- Putting measures in place for market volatility, for instance crashes or a recession
- Revamping production in line with green energy initiatives
- Addressing a shortage of talent within the organization’s workforce
- Increasing market share by a predefined percentage
Micro goal examples include:
- Meeting a specific sales quota by the end of the month
- Initiating coaching or training for employees in the bottom 5% for performance
- Meeting with managers to outline an action plan to address a specific issue
- Performing an audit of an inventory
- Hiring a certain number of employees
Setting metrics to measure performance and other progress towards goals
Once goals and objectives have been established, the metrics through which progress towards their completion will be measured needs to be defined. This gives teams and individuals tangible data through which they can monitor progress, identify problem areas and correct course.
Some metrics to consider using include:
|Volume||Volume metrics such as units sold within a given time frame|
|Productivity||Output per hour of work|
|Revenue per employee||Total revenue of the firm divided by employees. Useful for benchmarking|
|Efficiency||Rate out output per unit of input|
|Customer satisfaction||Measured from the customer perspective, for instance through surveys and questionnaires|
Ultimately, performance management is about working with the people expected to deliver the results. There are powerful performance management tools available to help HR leaders and managers gain a birds’ eye view of the organization. Such tools can provide valuable metrics on the strengths, weaknesses and particular skills at the individual, team and department level.
Understanding how talent is distributed throughout the workforce
Understanding the skills and capabilities of employees starts with the onboarding process and continues throughout their time with the organization.
Here’s what you need from your performance management toolkit to deliver this insight.
Personal Development Plans (PDPs)
Personal Development Plans should be used as a part of a new employee’s onboarding process. This should determine their current skills and competencies, including anything not covered during their application. It should then look to address how the employee wishes to develop and add to these skills during their tenure at the organization.
PDPs should be viewed as organic, evolving processes. HR leaders and managers should consistently review these when discussing performance and career issues with their staff so that these goals are aligned with the aims of the company.
Employee skills database
A searchable database of the skills and qualifications of individuals and teams in your organization can be an invaluable resource when looking to solve unconventional problems.
The right person for the right task might not always be in the right place, and this tool will allow managers to place employees with stronger skill sets with the best colleagues.
Breaking down an employee’s performance can help HR leaders and managers fine-tune the measures needed to develop their skills and strengthen alignment. Success circles allow users to view 5 core aspects of an individual’s role by displaying development, performance, culture and brand, communication, and leadership attributes in an easy to read chart.
These factors can then be linked directly to other competencies including rewards, behaviours and objectives to monitor alignment. This allows both managers and employees to track strengths and weaknesses in real-time.
Connecting employees via a multi-channel communications platform
With workforces frequently split between remote working, on-site work and elsewhere, multi-channel communications connecting mobile phones with desktops and laptops via a performance management app are essential.
Employees sometimes require in-depth discussions of topics that can’t be achieved via email. Forums allow for these deep dives to take place in a central location which can be easily categorised for ease of reading and accessed remotely. Over time, forums can become an increasingly useful depository for guidelines and tutorials.
MS Teams integration
Group email chat is notorious for being unreliable, so integrating Microsoft Teams gives individuals and departments a place to set up specific channels for a variety of functions.
Promoting employee well-being can be especially tricky when many members of staff are working remotely. A social intranet allows employees to share their personal interests and make connections with colleagues which strengthen friendships.
They are also well suited for employees to create networks for shared interests, whether it’s setting up a weekend cycling group or sharing favourite recipes.
With team and individual roles and expectations defined, and the communications channels in place to ensure a smooth workflow, the next step is to define the process necessary to achieve these goals.
Using tools to keep individuals and teams focused on what matters the most
Broadly speaking this encompasses the day to day actions required of individuals and the performance management tools required to keep everyone on the right track.
Key Performance Indicators (KPIs) and Objectives and Key Results (OKRs) dashboard
Performance management tools allow managers and employees to instantly track daily, weekly and monthly objectives and key performance indicators. By viewing these through dashboards, information pertinent to the important tasks can be instantly understood.
Analytics and reporting built into the architecture of dashboards allows managers to break down goals to better understand any issues which might be causing performance to slip.
Introducing a degree of healthy competition to individual and group performance can help increase motivation throughout the company. Performance leaderboards allow managers and employees to see how well they are progressing in real-time and can be used to track performance at all levels of the business.
Scheduling continuous feedback to boost motivation and engagement
Good performance accountability is about having a positive conversation between manager and employee. A manager is a coach and communicator, not command and controller.Dave Ulrich, Co-Founder The RBL Group
Regular feedback should be at the core of any contemporary performance management strategy. This is especially important as millennials continue to dominate the workforce.
As a report from Gallup revealed:
“Only 19% of millennials say they receive routine feedback. An even smaller percentage of millennials (17%) say the feedback they do receive is meaningful … Gallup also discovered that just 15% of millennials strongly agree that they routinely ask for feedback. And one in three millennials strongly agrees they’ve told their manager the one thing they need most to get their work done and why.”
Regular one2one sessions
Regular check-ins and one2one sessions are the mechanisms by which HR leaders and managers keep those crucial conversations on track, and can be easily scheduled in performance management tools.
Continuous one2one meetings:
- Reduce attrition rates. Employees who feel part of a constructive conversation about their career prospects and value within the company are less likely to consider moving elsewhere.
- Boost motivation and engagement. Engaging in useful dialogue about tasks and progress maintains higher levels of enthusiasm.
- Improve morale. Employees facing personal or professional concerns are more like to be satisfied a solution can be found if they are engaged in frequent discussions with management.
Awards and recognition programs
Employees know they are valued when they are recognized for their accomplishments. Performance management software allows managers to raise the visibility of this appreciation, sharing success stories with the broader workforce. Peer-to-peer awards schemes add another layer of positive feedback and encourage colleagues to celebrate the achievements of their team members.
Provide ongoing training and developing to ensure employees have the skills they need
Regular conversations between managers, team leaders and their employees help bring to light any shortcomings which need addressing. A performance management toolkit helps HR leaders and managers take the next step to address those skills gaps and deliver resources for their development.
These tools include:
Similar to the goals laid out in Personal Development Plans, development objectives tend to be broader in ambition and completed over a longer duration of time. They can also be established at the team and department level to meet changing demands at a greater scale.
Coaching and mentoring
PDPs, feedback sessions and general performance all inform the degree to which employees require further coaching and mentoring. HR leaders can make use of employee skills databases to connect employees with particular skills with those who need upskilling, while the performance management intranet can host a range of online learning tools.