Avoiding Poor Performance Management
Performance reviews can carry a reputation for being complicated and burdensome. However, this view typically stems from a lack of proper processes and understanding, rather than the inherent nature of the reviews themselves. The truth is, when done effectively, performance reviews can be a straightforward and valuable tool for both employees and employers.
When done diligently and when you put the human at the centre of the conversation, there should be no harm caused to the person during the PM process. This is a key part of cultural development and employee retention.
Does structure matter?
According to a study of Facebook employees, 87% of employees expressed a desire to keep formal performance ratings. This statistic highlights the importance of following a structured performance review process. When undertaken with structure and intent performance reviews offer numerous benefits:
Alignment with Business Goals: Performance reviews help align individual goals with the overall business objectives, ensuring that everyone is working towards the same vision.
Personal Development: They provide an opportunity for employees to articulate and focus on their own growth, setting the stage for continuous improvement and greater connection to the business with the aim of retaining high performers through investment in your people.
Informed Decision-Making: The data gathered from performance reviews can be invaluable for making informed business decisions around succession planning, risk management, and identifying key talents within the organisation.
Upskilling Managers: A newly promoted manager, after receiving training on how to have review conversations would confidently conduct his first annual reviews. The structured process would boost his confidence, allowing him to deliver clear, constructive feedback. His team would appreciate the conversational approach and leave the reviews with a clear understanding of their performance and goals for the next 12 months. Career paths and succession opportunities were also identified. Thanks to having regular informal feedback throughout the year, there were no surprises, making the review process a productive close to the year.
Creating a Culture of Continuous Feedback – Don't ‘set and forget’
To avoid the pitfalls of ineffective performance management, it's important to foster a culture of regular, informal feedback. This approach ensures that performance discussions aren't just annual, tick and flick events, but are ongoing, effective conversations. Effective performance management conversations can be a skill to master, therefore, upskilling managers on how to deliver feedback effectively is important, ensuring your people walk away from the discussion clear on outcomes. These conversations also create a two-way communication loop between the employee and employer.
Key Elements of an Effective Performance Review Process
Support and Training for Managers: Equip your managers with the skills they need to conduct performance reviews effectively. This includes preparing for the conversation, being organised, and fostering an environment where employees feel comfortable. Ensure they understand the process.
Employee Engagement: Ensure that employees are actively involved in the process. A performance review should be a collaborative effort, where employees contribute their perspectives and data. You are likely to get greater buy-in from the employee when they are asked to self-rate and provide feedback on how they think they've performed. It shouldn't just be about the Manger giving the employee feedback.
Commitment to the Process: Regular touchpoints for new employees during the first 6 months of employment, help integrate them into the performance review process from the beginning of their employment. The Company's commitment to feedback and reviews from the beginning will be evident.
No Surprises: An effective performance review should never contain surprises. Regular feedback ensures that employees are aware of their progress throughout the year and provided with areas for improvement well before the formal review. They shouldn't walk into a review and be given some feedback that they are hearing for the first time.
The Business Benefits of Good Performance Reviews
Conducting effective performance reviews not only benefits employees but also provides significant advantages to the business. These include:
Succession Planning: Identifying emerging leaders and preparing them for future roles.
Data-Driven Decisions: Gathering qualitative data from employees to make informed decisions on culture, distribution of rewards, career pathways and professional development.
Cultural Impact: A strong performance review process can boost morale and create a sense of connection between the business and its people.
Incorporating a well-structured performance review process, with a focus on continuous feedback and employee engagement, ensures that performance management is both effective and beneficial. By putting the human at the center of the discussion and committing to regular, meaningful reviews, organisations can foster a culture of growth and alignment, ultimately driving success for both the individual and the business.