Performance Management

Performance Management is the continuous process by which an organisation sets employees’ and teams’ objectives in line with the business strategy, establishes processes for coaching and development, reviews and assess progress against the objectives set and then recognises and rewards strong performance. It is often referred to as a cycle because the moment objectives are reviewed, and performance for the agreed goals is assessed and recognised, fresh goals are set for the next time period.

Why is it important to set objectives?

Performance planning is an essential stage in performance management. Employees need to have a clear understanding of what is expected of them and that there is a common language between team members and team leaders on what they should be trying to achieve, how they should achieve it and how one’s performance would be evaluated.

The setting of goals or objectives, helps team members to focus on the most important priorities and allows for team members to self-manage their tasks based on the agreed goals rather than expected to be directed at every turn or obstacle. This becomes even more critical when these teams are working remotely since one needs to rely on the output being delivered to gauge performance and this can only be done if the objective or goal was clearly expressed at the onset.

How can employees be supported to improve performance?

Once objectives are established, there should be a continuous process of coaching and two-way feedback between team member and team leader. Whether the organisation opts for a formal or informal feedback process is not as important as ensuring that some form of feedback cycle is taking place. Employees need reassurance that they are in fact performing to the standard expected and most would welcome constructive feedback that can help them perform even better. This means that team leaders need to ensure that they are setting a time in their calendar where they can catch up with their team members and aside from providing feedback to the team member, allow enough time to listen as well. Ultimately, coaching doesn’t need to happen in time-boxed occasions only – it can take place during the job and be part of an ongoing communication process.

The Performance Appraisal

A key pillar of performance management is the appraisal process – essentially taking stock of the performance of the team member against the objectives set at the start. Some companies also opt for a 360-degree appraisal that adopts feedback from other employees working with the individual being reviewed (e.g. subordinates, colleagues and 3rd parties) together with the feedback from the line manager.

The performance appraisal is typically more formal in nature since a number of companies link it to performance bonuses or other forms of reward and recognition. The performance appraisal should be an opportunity for transparent dialogue between team member and team leader with the individual given opportunity to express how they feel they have performed against objectives set, as well as offer feedback on their own role and their development. Employees also deserve to be given clear feedback of where they are performing strongly and where they need to improve, preferably offering concrete examples.

Performance management is more than just setting goals and carrying out an appraisal – it is a vital cycle that keeps organisations performing at their best and sets a culture of expecting and recognising strong performance. Done right, the performance management process enables companies to remain lean while retaining their best talent on board.