Performance Management

 

Given the ever-evolving nature of the workplace, particularly over the last few years, is it time to reconsider our traditional performance management practices too? For years, annual reviews and goal-setting have been the backbone of performance assessments. Can we still use and enhance these time-honoured traditions, or is it time for a complete overhaul? This month, we delve into the future of performance management, exploring whether there’s potential to breathe new life into the traditional methods, making them more effective and relevant in our modern businesses. 

 

Performance management has relied heavily on two components: 

Goal Setting: Employers set annual objectives, providing a roadmap for an employee’s work. 

Annual Reviews: Employees receive feedback at the end of the year, assessing their achievements and areas for improvement. 

 

The limitations of such an approach are fairly easy to spot. 

Inflexibility: the traditional approach does not incorporate an ability to adapt to changing circumstances or business opportunities mid-year. 

Infrequency: a fast-paced business environment requires fast-paced feedback if employees are going to remain engaged and effective. 

Subjectivity: traditional reviews are prone to bias and make it potentially more difficult to maintain fairness. 

 

Increasingly businesses are looking to enhance their performance management with more innovative approaches. 

Real-time Feedback and Coaching: an approach which emphasises frequent, timely, constructive feedback to empower employees with real-time insights and foster a culture of improvement. Less formal than an annual review, real-time feedback allows employees to quickly identify and make necessary changes. 

Agile Goal Setting: replaces rigid, annual goals with adaptable, agile goals. Often involving shorter timeframes (e.g. quarterly), this approach allows more frequent reassessment and realignment with your current business needs. 

Use of Technology: performance management software features such as 360-degree feedback, goal tracking and performance analytics can automate routine processes, freeing managers and employers from the time-consuming elements of annual reviews. This allows for more meaningful discussions about development, as well as preventing some of the bias prevalent in traditional annual reviews. 

 

While these more modern approaches aim to correct some of the limitations of a traditional approach, they are not without their own difficulties. Resistance to change is perhaps the biggest hurdle, and with it can come concerns about the fairness and privacy of a new system. 

 

While more modern approaches to performance management undoubtedly offer much needed improvements to systems struggling to keep up with a changing workforce, that doesn’t mean starting from scratch is necessary. There are several ways the modern approaches can be incorporated within a more traditional performance management system, bringing increased effectiveness and value both for employees and for your business. 

Set agile goals not annual ones: incorporate monthly or quarterly goals within annual reviews which can be updated when necessary. 

Schedule regular check-ins: short, regular one-to-one meetings between manager and employee to provide feedback, discuss progress and address concerns. 

Use technology: consider where time can be saved or improvements made with the use of performance management software e.g. performance analytics, 360-degree feedback 

Make communication two-way: more regular conversations between management and employees allow both sides to raise concerns and offer the opportunity for employees to give feedback to managers as well as vice versa. 

 

The traditional performance management model undoubtedly faces challenges in a rapidly evolving work environment. However, with the implementation of a few changes such as regular check-ins and agile goal setting, businesses can breathe new life into these time-honoured traditions. The key is to adapt and evolve our approach to performance management, not to discard it. As businesses embrace even small changes, they will create an environment where employees thrive and contribute to their fullest potential, to the benefit of both the business and its employees. 

 

Want to change or improve your performance management processes? Get in touch to find out how we can support you with your business-wide performance management, and/or offer tailored support for specific circumstances.