3 Steps to Better Performance Management
The days of the traditional performance review are behind us. Today, 75% of companies surveyed either have switched, are switching, or are planning to switch to a more updated performance model in an effort to boost employee engagement and drive productivity. Defining that model, however, is a difficult task, as each organization is unique. Following these three steps, however, will ensure an effective transition.
1) Increase Transparency. Employees can better align themselves and their goals with company values and benchmarks when they have a clear understanding of how embodying those values and meeting those benchmarks impacts their day-to-day work life and their overall compensation package.
Ask yourself whether all of your company’s employees can fully explain the organization’s performance management process and the link between their overall performance and their pay. Do they know what all the benchmarks are and how they were chosen? If not, consider filling in those gaps in knowledge with clear explanations.
Transparency builds trust, and trust is a crucial element to organizational success. High trust in the workplace not only makes a company a top-ranked place to work, it also makes a company more than two-and-a-half times more likely to be a high performing revenue organization. The most trustworthy also have been found to consistently outperform the S&P 500. That’s a high reward for a little clear communication.
2) Build a Mentoring Culture. With increased transparency, employees have all the knowledge they need to know how they’re doing in their current roles and what they need to accomplish to grow in those roles and/or to take on new ones. However, if they don’t have any way to act on that knowledge, it won’t be of much use. Creating a mentoring culture, however, ensures they can put their knowledge to good use by asking for feedback or coaching when they need it.
Make sure they have access to educational resources, including experienced members of your team. Most companies focus too much on formal education and career development, when research shows that approximately 80% of learning takes place in an informal environment. A mentoring culture helps adjust this error by encouraging questions, discussions among peers, and on-the-job learning.
3) Give Employees the Wheel. Once you prioritize transparency and foster a mentoring culture, your employees will know where the company is and where it wants to go. They’ll also have the tools and resources necessary to help you get there. Once they have that knowledge and opportunity, it’s easy for them to adjust their day-to-day tasks to propel the company forward. Don’t tell them how to do their jobs. Tell them what you want the company to achieve, and let them figure out how to get you there. The more active your employees, the higher their engagement, their performance, and your overall productivity.
Transitioning from a traditional performance management model doesn’t have to be difficult. Implement these three steps, and watch your company culture, performance, and revenues bloom.
To learn more about Performance Management best practices, view the following resources:
Our Platform: Performance Management
Is Your Performance Management Process Adapting to the Times?
What drives your employees, and how do you harness that drive to benefit company culture and profitability? Traditional models of performance management say you do it by offering financial rewards based on the accomplishment of yearly goals, and that model has survived for decades, despite research that indicates only about half of people think such […]
Why Your Employee Performance Review Needs to Change for Millennials
Millennials are now the largest generation working today and they are constantly changing jobs. Many companies are left trying to figure out how to engage and retain their millennial talent while a large portion of employers are not adapting to the times. The organizations that have shown success with their millennial employees realized that they […]
The 5 Ways Your Performance Review is Failing Millennials
Millennials currently make up more than a third of the global workforce, and that number is rising quickly. By 2020, one out of every two workers will be a Millennial. While this is good news for a world that needs innovation and technological savvy – two areas in which Milennials excel – it can be […]