Every organisation needs a performance management process to utilise their staff in the best way.

Performance management is the backbone of your business and spans multiple elements. Being able to figure out the best way to create and manage an effective performance management procedure is crucial.

Working with management to come up with new and fresh ideas for performance appraisals is just one way to help.

What are the key elements of performance management?

We have identified six different key elements for effective performance management:

Evaluate current performance appraisal process

Does the current process work? How often do you provide feedback to your employees? Are appraisals once a year, or does your business do them more often?

By evaluating what you do now, you can see where you might need to change things. Having a traditional annual appraisal may no longer work for many companies. There is a need for more continuous feedback throughout the year to keep up with everyone’s progress.

Identify organisational goals

Using a performance management system can help all team members feel they are truly part of the team as a whole.

They can all work towards achieving the goals set and can help with the company’s development. Employee performance plays a huge role in this process, as it helps to ensure everyone is pulling in the same direction.

Set performance expectations

Laying out expectations for each employee is important for improving performance.

Focus on what they are already doing well. Come up with ways you agree on to help in any weaker areas and give them feedback. Discuss goals for the next six months and prioritise them, using a deadline for them to achieve these goals. Performance reviews should be beneficial to both the employee and the team as a whole whilst managing expectations.

Make sure targets are realistic and specific to that employee. Objectives and targets should be clearly defined, and not too difficult that the person may give up or not achieve it all no matter what support is given.

If you give generalised expectations with no clear deadline, they are harder to achieve.

Consider setting SMART objectives:

Specific, Measurable, Achievable, Relevant, Timebound

or FAST objectives: Frequently discussed, Ambitious, Specific, Transparent

Monitor and develop performance throughout the year

Keep checking in with employees to ensure they can manage their goals. Concerns from employees or line managers need to be discussed as soon as possible to offer support, training or coaching if necessary.

This helps keep everyone on track and can ‘nip issues in the bud’ thereby prevent small issues escalating into big problems. People who have the support and coaching from senior staff members will see improvement, and management should be aware of that.

Evaluate performance

A simple key factor, let the employee know how they’re doing. Be specific; use examples so they can see that they have been noticed. Employees work better if they get regular feedback and support.

Using monthly check-ins are great for this, and management and HR departments see consistently good individual performance when employees get regular feedback.

Discuss potential solutions to any issues that you may have. Listen to the employee’s queries or concerns to make sure everyone is always on the same page. Managers that are in regular contact with their employees will see development and their objectives met.

Set new performance expectations for the next year

These may be the same but look at the new organisational goals.

What has changed? Has the employee achieved the goals over the last year? Does one particular team need more support to achieve its goals? Do you have the right staff in the right places?

Use rewards to celebrate even small wins for teams. Using key performance indicators can help you see which team is performing well and which ones need to improve performance. Meals out, pizza days in the office and gift cards are all small and effective ways of rewarding goals being hit.

Put your performance management systems in writing, and place them in communal areas, so all employees have access to them. Having employees sign the document signifies a ‘mutual contract’ so that everyone agrees to work towards it.

What role does HR play in performance management?

HR departments play an important role in implementing and maintaining performance management systems. Managers and employees rely on HR teams to make sure everything runs smoothly.

Performance management procedures are normally created with the help of HR departments. Using their knowledge, managers can trust the process that has been formulated.

HR departments can help line managers and supervisors have constructive conversations with employees regarding their performance. This will only improve their performance and help to retain employees.

At Petaurum, we advocate creating the performance management process as part of a wider People Strategy

There are usually five components in a People Strategy which help to create a structured and joined-up framework of people processes, ensuring alignment with your objectives and aspirations.

1. Values and Behaviours

We can help set out clear expectations of behaviours that you expect from every employee.

2. Workforce Planning

Linking business demands and resource requirements. You can have the right people in the right place at the right time.

3. Performance and Development

Creating and developing a healthy high-performance culture.

4. Reward & Recognition

How to reward and constructively recognise your employees. We also help you recognise what constitutes good performance.

5. Communication and Engagement

Everyone in your company deserves feedback. We help to ensure this happens concisely and promptly. Also, we also help devise ways of communicating other news that the employees need to be aware of.

By using these five elements, we have developed hundreds of clients’ strategies, which have helped to drive their performance. We have helped companies create new ways to have performance reviews and help employees’ development.

Having a good strategy for performance management can be the catalyst your business needs to grow. Good workers are much more likely to stay in a job where they feel valued, heard and have opportunities to help them have a future company.

Find out more about HR and People Strategies here

How can we help?

Using a wealth of industry knowledge and over 90 years of experience, we can help implement processes to give companies the tools to help with their performance management.

Because of this, our clients have seen an improvement in individual performance as well as management performance.

To see how we can help you and begin a new performance-based goal-setting method, contact us today.