Most organizations recognize the importance of investing in a good performance management system. Often, what gets less attention is the qualities related to the managers’ involvement and ability to manage their role in the performance management process. When these qualities are sharpened, what remains is an organization culture of high performers. According to a 2014 Deloitte survey, 68 percent of HR professionals deemed performance evaluation as ‘important’. The figure climbed to 75 percent in 2015. Meanwhile, the Global Human Capital Trends 2015 report states that 89 percent of organizations surveyed planned to conduct their next performance evaluation in the next two months. Let’s take a look at a few tips you might want to consider to set up performance management process as an organization priority.

Making Performance Management A Priority

When it comes to the performance evaluation process, the most important aspect is to hold managers responsible for the performance outcomes. The effectiveness of a performance evaluation system largely depends on:

  • The value of performance management for driving organization’s goals.
  • The involvements of senior leaders in the system.
  • Consistent use of the system across all departments.
  • The involvements of the employee in the process.

Effectiveness of a Performance Management System

Employees perform better when they feel connected to a ‘larger vision’. In other words, your employees should understand how their work is affecting the organization goal. This will not only inspire and encourage them to work harder but also turn them in advocates of the organization.

Transparency remains a critical factor in the implementation of the performance management system. Your employees must understand the standards on which they’re being evaluated. This will foster a belief that they are being evaluated objectively. Employees who feel they’re being treated fairly increase the amount of effort they put into their job.

While the performance management system is a critical driver of an individual’s performance, it doesn’t exactly promise organizational success. In fact, many factors contribute to the success of the organization alongside performance evaluation. This includes:

  1. Flexibility: a platform where employees are provided the space to grow despite previous failures.
  2. Seamless communication: open and effective communication where information flows in all directions.

Employees should be encouraged to take charge of their own development. While interacting with their managements will greatly help set clear expectations, it won’t do much in the long run. Employees should be able to figure out solutions to work problems on their own. They should be able to focus on the future, and create a development plan on their own. This is a key driver to creating leaders of the future.

An effective performance evaluation system can yield twice as much as benefits as a performance evaluation system which only reflects on the points. After all, in the end, everything depends on the results. Be it productivity, profitability, revenue growth, customer retention or employee satisfaction.

So, what do you think? Apart from the aforementioned highlighted qualities of an effective performance management system, are there any others you would like to propose? Share it in the comments.

2 Responses

  1. Mischa Riedo

    I fully agree with you. I think the biggest flaw of the traditional processes are that they are completely disengaged from the actual business. I think this has to change more than anything else. The consequences of those processes are employees that don’t know where they stand throughout the year as they don’t receive the necessary feedback and fail to see how their performance impacts the business.
    The fault is not solely on managers though, the process (especially the yearly cycle) is at least as much to blame.

    Reply

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