What is Performance Management?
Performance management is essentially overseeing the relationship between organisational objectives and the skills, experience and capabilities of an organisation’s employees. Overseeing this linear relationship will involve drawing and analysing the aligned results developed. These results emerge from different stages through business activity – either the middle of productivity or at the end stage. In essence, the focal point around performance management is understanding how to establish a workplace culture of high performance by using the relevant internal and external resources, tools and structures. In doing so, organisations will be able to reap continuous benefits, one of many being the results they pre-determined.
Why Performance Management?
Performance management is a necessity to ensure your staff is well equipped to sustain and grow the business. When an organisation invests in its people through a compelling performance management program, it makes employees feel empowered to achieve above and beyond expectations and provides a source of motivation.
When giving employees the tools required to deliver, you help unlock their full potential. Hidden strengths and positive feelings are unleashed, resulting in continuous improvement and beneficial business outcomes. This is a very important aspect to performance management, as it sets an ongoing platform to results being delivered.
Inclusive to this aspect of performance management is the conduct of performance reviews, appraisals and employee engagement best practices. Each of these components are pivotal in arousing an ongoing commitment within the employee. By doing so, you will see them respond with regular attendance, meeting their daily benchmarks and willing to give more hours for work while reducing turnover and improving your employer brand overall.
While the focus on employees in performance management is a crucial aspect, an addition to why performance management should be adopted is for the business’ overall viability. Getting your people involved in their personal growth, the assessment of their own skills and strengths, and the development of SMART goals aligned with the overall company strategy get you one step closer to achieving increased performance. A performance process that is inclusive will result in improving the functionality of teams within the organisation. In essence, the organisation is situated in a position that will enable them to maintain competition in the same industry and survive long term.
Having explored that the reasons for adopting performance management are within the scopes of a company’s employees and its goals and objectives, they stand to be general reasons. We can explore further of intricate benefits when performance management is implemented in an organisation.
Benefits of Performance Management
The right strategy for performance management has many benefits for an organisation, regardless of which industry it operates in. Whether they profit business on the long or short term, the promise of an effective performance management programs should drive the leadership team to take action. The possibility to grasp onto expansion and development via implementing a well-structured performance management system includes:
1. Identify gaps in existing training programs
This is part of the process of aligning your employees’ skills and expertise with the goals and objectives of your organisation. By completing a thorough skill gap analysis to identify the skills your organisation needs to reach its objectives, you will be able to align your recruitment process as well as your learning and development programs to develop an adapted solution for both your employees and your organisation. Regular performance reviews and informal checks organised in cooperation with line managers will help pinpoint poor performing individuals and uncover the issues behind their lack of performance. Based on this analysis you can identify the training and courses required to close that gap.
2. Improved Communication through Organisational Members
When objectives and roles are clearly defined, you can simply improve your internal communication. Part of achieving the overall business objectives is to ensure employees and managers understand precisely what is expected of them. For this precision to take place, it will see the need of better and increased communication. Improved communication enhances the sharing of information between employees, managers and business leaders which in turn profits innovation and productivity improvements. The free flow of information encourages employees to approach their manager with ease when issues arise and involves them in the management of their own performance as well as the company’s. Performance is transformed into a two-way conversation, promoting engagement and a happier workplace.
3. Identify bottlenecks and inefficiencies
The performance management process not only allow you to develop employees more effectively, it also enables managers and employees to identify roadblocks to their advancements toward their goals. Implementing a well-structured performance management system will involve regular monitoring over staff members by managers. This is to ensure that the objectives they’ve set out for themselves are continuously being met. Regular performance reviews allow your organisation to be more agile by formalising the process of issue identification, and providing solutions in a prompt manner.
4. Link performance evaluation with individual employee development
Part of ensuring performance objectives are being fulfilled consists in carrying regular performance appraisals. Performance evaluation create accountability for success and draws our attention to the people responsible for successes and losses. While you will want to recognise high performance for their great work, you will also want to identify individuals that have derailed from their objectives and give them the tools to be back on track. This means that you are able to align their ability to meet benchmarks with their professional development. Through targeted employee development, you can gain competitive advantage by turning your employees into a highly precious asset. Rewards and incentives are part of any well shaped performance management program. They help create an ongoing commitment to perform and deliver results.
5. Align business and employee goals
The ability to define performance objectives significant to business is of paramount importance to the success of any performance program. Ideally, you’d want these objectives to integrate in the day-to-day business activities by using a mix of short and long term goals. Goal alignment help keep teams, employees and managers motivated working in the same direction and creates cohesion. In addition, you improve on executing the business strategy by creating the operational framework to reach those objectives. They create a shared understanding of what the business is trying to achieve. Employees understand their role and the impact their work can have on growth, furthering their engagement towards the business.