The Importance of Performance Management

Posted by Christy Putnam on September 28, 2018 at 11:06 AM

The Importance of Performance ManagementMany companies set up processes to formally evaluate an employee’s performance after an initial probationary period and then on an annual or semi-annual basis. Employers and managers often feel that these are time-consuming exercises that do not yield desired results. Does your organization share the performance management concerns released in a CEB study, which shows the following:

  • 95% of managers are dissatisfied with their performance management systems.
  • 59% of employees feel performance management reviews are not worth the time invested; 56% said they do not receive feedback on what to improve.
  • Almost 90% of HR heads report that their performance management systems do not yield accurate information.
If these statistics feel familiar, read on...

So then what are the benefits of a performance management program?

Performance management, when done correctly, can ensure employees are meeting or exceeding expectations. Additional benefits provided by a well-run performance management program include:

  • recognize employee achievements and value performers
  • increase employer-employee communication and strengthen relationships
  • document incidents of poor performance for future reference and/or validate demotion, layoff, or termination
  • provide employee motivation and define structure
  • establish employee goals to align with company’s strategic direction

Choosing the right method of performance reviews for your organization can be challenging. The method that is selected should align with the company's culture. Additionally, it's helpful to use a Human Capital Management system that can support your preferred method by providing transparency into the process and tracking the details. There are several methods to choose from, a few of which include:

Management by Objectives: Specific goals and timelines are agreed upon by the employer and the employee. Success and failure are easily defined under this method.

Rating Scale: A rating scale methodology is commonly used and typically easy for employees to relate to as it is similar to how students are graded in school. A number scale is developed (e.g. 1-5), with the lower numbers being unsatisfactory performance and the high numbers representing exemplary performance. An individual's defined traits and skills are then rated, by the manager, within the scale to determine if employees are meeting expectations.

360-Degree Feedback: This method typically includes feedback from the manager, peers, direct reports, customers, vendors, and the employee. This process produces multiple perspectives, giving a well-rounded view of the performance.

Regardless of the method your organization selects, keep in mind that it is critical for performance conversations to be on-going and regular; not just a couple of times a year. The importance of performance management is also about providing continuous training and development opportunities, giving both positive and negative feedback, and following established procedures strictly.

Want to learn more about performance evaluations and effective coaching??
Attend our complimentary webinar:

Performance Evaluations & Effective Coaching
Thursday, November 21st at 11:00am

Register Now!

When registering for the session, please ensure that you enter ‘Bennett/Porter & Associates’ in the registration field that reads “Please provide the name of the company that referred you to this webinar.”

 

Topics: Human Capital Management, Human Resources, Leadership

Don't Miss a Thing!

Subscribe to our blog

Subscribe to our blog

    Recent Posts