What is Employee Performance Management?
Performance management is a continuous communication process between managers and their direct reports as they connect about company projects, personal and professional development, and more. The purpose is to assess employee performance compared to company goals, as well as set additional goals for the upcoming year.
Employers need to note that reviews play a critical role in employee satisfaction, motivation, and productivity. If avoided or used incorrectly, organizations can hurt employee morale, the credibility of management, retention, and the company’s overall effectiveness.
69% of employees say they would work harder if they felt their efforts were better recognized, according to Gallup.
Performance Management Trends
High-performing HR professionals understand that to keep retention rates high and develop talent from within, their managers and supervisors need to be focused on managing well.
Recent employer trends back up this approach and include …
1. Rethinking Employee Annual Reviews
Workers are no longer satisfied with a formal—and not always helpful—annual review accompanied with radio silence the remainder of the year. This somewhat antiquated process can cost your company productivity and even high-performing teammates.
As a popular SHRM article put it—
“Performance management should enable employee effectiveness, improve employee engagement, develop talent, and ensure retention of top performers through career transparency and growth opportunities.”
2. Desire for Regular Feedback
Instead of once-a-year feedback, employees are asking for ongoing feedback to improve performance, meet goals, and develop their skills.
3. Performance Tools
Employers are now relying on intuitive, digital tools like human resources information systems (HRIS) and performance management software to document conversations and feedback between employees and their managers.
4. Coaching Over Criticism
Employers by and large want employees to succeed. They invest time, money, and energy to ensure that workers are efficient and effective members of the team.
When managers take a coaching-over-criticism approach to evaluations, they’re helping improve performance without hurting morale—and fostering deeper connections with employees.
5. Millennials Stepping Into Management Roles
A study commissioned by Mark Emmons & Millennial Branding indicates that 27% of millennials are already managers and that by 2030, nearly half want to be managers.
What’s the significance? It’s possible that teams will have Millennials managing Generation Xers and Baby Boomers—a dynamic that might already be familiar to some employers. The generational gap isn’t unusual, but it’s something to watch in the future.
Performance Management Processes
Ongoing performance conversations enable managers to check in on short-term goals, help employees struggling with a specific task, and ensure your team is staying on track with larger learning and development goals. It allows for a more closely followed natural cycle of work since it switches the focus of reviews from past performance to present performance. Ultimately, it delivers higher rates of engagement, productivity, and enables development and retention.
Regular feedback is important to employees and their organizational growth for the same reason coaching is important to athletes and team performance. Data shows that humans perform better when they’re supported and coached. People want to be good at their jobs, and most of them want to grow professionally and take on more responsibility over time. It’s objectively good for people and for the organizations they serve, and both peer feedback and managerial feedback makes that possible.
Switching to Ongoing Communication
Switching to ongoing communication provides feedback that can be relevant and useful today, for example:
1. Continuous coaching
2. Growth-centric conversations
3. Increased visibility and accountability
4. Ability to address communication gaps
5. Skill development and growth
Perhaps the most important factor in any employee performance management system is 1:1 (one-to-one) meetings. A 1:1 is a regularly scheduled meeting that managers hold with each of their direct reports to provide an open forum for dialogue on the full scope of an employee’s role within the organization.
Implementing this ongoing review process can help to avoid issues that arise when managers fail to consistently track performance over an entire year. This can lead to missing key information come time for the annual review.
According to management research firm, CEB (now Gartner), 95% of managers are dissatisfied with the way their companies conduct performance reviews, and nearly 90% of HR leaders say the process doesn’t even yield accurate information.
What Are the Key Elements of Performance Management?
An employee performance management cycle likely looks different from one company to the next, so there isn’t a single “secret sauce” to successfully managing employees. In general, some of the most essential elements of performance management include:
- Planning for success
- Setting expectations
- Ongoing feedback and input
- Employee skill development
- Solving problems
Why Annual Reviews Don't Work Anymore
Annual reviews are a long-used form of employee performance management that many companies use more out of tradition rather than strategy. Unfortunately, they’re no longer as effective as they used to be. Here’s why:
- Limited Opportunity for Coaching: When performance is measured once every year, managers lose the ability to provide continual, 360-degree feedback. This loss of consistent and real-time feedback creates room for miscommunication and a lack of clarity.
- Too Much Room for Error: Employees are often so concerned about “getting a good score” that they approach the meeting without any plan for development or growth.
- No Accountability Measure: Without regular check-ins, employees are only held accountable during their performance reviews, not throughout the year. The problem with this end-of-year accountability is that it’s typically coupled with an end-of-year rush.
Which Method of Performance Appraisal is Best?
Employee performance management has changed in recent years. Now, organizations that prioritize 1:1 meetings between managers and their employees can establish a consistent and reliable channel for mission-critical information to get to the right places (both upward and downward on the organizational chart).
Some information that needs to be communicated just doesn’t lend itself to a monthly status update or ad-hoc email. What if someone has an innovative idea that’s only 20% baked and not quite ready for a presentation to the executive team? How else are they going to get support and feedback from a manager? 1:1 meetings are designed to address this communication gap.
Each week, employees develop an agenda and deliver it to their managers (ideally using an HRIS with documentation features). During these meetings, managers and employees set expectations, discuss goals and challenges, track progress, and identify areas for improvement. Not to mention that these 1:1 meetings allow for employee feedback to managers, too.
In a recent report, Gallup asserted that only 30% of employees strongly agree that their manager involves them in goal setting.
Who Should Participate in 1:1 Performance Reviews?
Managers and their direct-report teammates should participate in 1:1 meetings. By implementing weekly 1:1 meetings, managers can offer constructive coaching, stay updated on an employee’s performance, and cover compliance concerns on a regular basis.
Weekly 1-to-1 meetings are especially important for connecting with your teams and gaining insight into the well-being of your employees if your organization is still working remotely. As a result, this practice can boost employee relations and even improve retention.
Performance Improvement Plan: How to Implement 1:1 Meetings
Improving employee performance management practices first begins with implementing ongoing 1:1 meetings between managers and their direct reports. Here’s how:
Determine a frequency: weekly is recommended.
Schedule reoccurring meetings: 30 to 90 minutes should suffice.
Implement a form of documentation: it’s important to gather all correspondence and remain compliant by allowing managers to see communication and feel confident employees are receiving coaching.
Document process expectations:
- Agendas: require employees to send 1:1 agendas at least 24 hours before the 1:1 to allow managers time to respond with additional notes or agenda items to add.
- Recaps: within 24 hours following a 1:1 the employee should send a detailed summary of discussions. Managers should respond to the summary clarifying any points requiring summarization from the manager.
Once you have a grasp on the basics above, you should communicate the new employee performance management processes to managers and HR professionals to ensure your company philosophy, mission, and values are woven into expectations.
Next, host an all-employee meeting to explain the reason and process for implementing this great feedback tool. Be sure to provide examples and answer any questions that arise during the meetings. To get a jumpstart on 1:1 agenda items and promote development, you could even use this meeting to have employees complete a self-evaluation for the upcoming discussion.
Finally, following the all-employee meeting, managers should send out a recurring calendar event invite to their employees to ensure meeting attendance.
68% of employees who receive accurate and consistent feedback feel fulfilled in their jobs, according to this press release.
How Do You Conduct a Good Performance Review?
Many managers feel that feedback can lead to an uncomfortable work environment. As a result, they shy away from the feedback process, believing that it does more harm than good. However, employees actually want to receive more feedback, it just comes down to how managers communicate.
6 Ways to Provide Employee Feedback
1. Make regular check-ins a norm: Employee feedback works best when it’s treated as a continuous process so you can address problems as they arise.
2. Don’t overcompensate: Many managers like to share a piece of constructive feedback with two positive compliments. Integrating this sort of feedback can make employees receptive to work on the negatives.
3. It’s a two-way street: Turn constructive feedback into a conversation. Be open to listening to employees’ reasons behind their problem areas.
4. Provide explanations: Provide real-time and actionable reasoning behind your feedback in order to give a clear roadmap to employees on how to go forward with the received feedback.
5. Set expectations: The ending of the feedback sessions is just as important as the beginning. Reaffirm your expectations to set employees up to understand what needs to be improved.
6. Follow-through: It’s your responsibility to support the employee through their journey of improvement. Additionally, plan to meet soon after your one-to-one to discuss the progress.
Offering feedback to employees isn’t always easy. But if approached correctly, it’s a great way to establish your company’s goals and set effective performance standards for your employees.
1:1 Meeting Samples
The best way to discuss issues, develop relationships, and make sure employees’ goals are being met is by holding 1:1 meetings with individual employees. It sounds simple, but in order for them to be effective, there’s more to it than just sitting down and having a conversation.
Document all parts of your meetings so you can successfully review and follow up in your next 1:1. To help you get started, we’re providing you with a sample 1:1 agenda, summary, and common questions to ask.
Sample 1:1 Agenda
Managers should communicate the importance of sending 1:1 agendas at least 24 hours in advance of the scheduled meeting in order to provide themselves enough time to prepare and add additional items as needed.
Below is a sample agenda template you can share with your employees to give them an idea of how this should look:
Below outlines the topics I would like to address in our one to one tomorrow:
- Pulse check—how am I doing? What can I improve on?
- Review draft for (upcoming project)
- PTO request on (date)
Do you have anything to add to our agenda?
Sample 1:1 Summary
Employees should be held responsible for sending a 1:1 recap within 24 hours of the meeting so you have a documented meeting to refer back to. As necessary, managers should add their own notes to summaries. Below is a sample summary:
Here’s a recap of our discussions:
- Pulse check
- How am I doing? My confidence has increased causing my sales to improve.
- What can I improve on? Studying my sales script so it sounds more natural than reading the document.
- Review draft for (upcoming project)
- You mentioned adding ______ to the document
- I will send you my final copy by the end of the week for approval
- PTO request on (date)
- You approved this day and I will add it to my shared work calendar
Am I missing anything?
Common Performance Review and 1:1 Meeting Topics
If you’re unsure of what to talk about in your one to ones, remember it’s an open environment that’s used to ask questions, gather feedback and discuss goals. Here are a few planning stage performance management topics to help you get a jump start:
- Short and long-term priorities
- Feedback on assignments
- Check-in on goals
- Identify and resolve roadblocks
- Celebrate successes
- Identify what worked well (and didn’t) on recent projects
- Career goals
- Learning opportunities
- Ask for feedback from a manager perspective
- Schedule your next meeting
If conducted correctly and frequently, performance appraisals can have a tremendously positive impact on your team. Simply put, hosting reviews once a year is not enough to understand how your employees are performing day in and day out. Consider all of the positives, and then take steps to guarantee continuous success by providing ongoing communications.
96% of employees say receiving feedback regularly is a good thing, according to The State of Employee Engagement.
Providing continuous and high-quality feedback to improve performance and inspire employees is not an easy task. Ensure high-quality feedback and improvement by adding BerniePortal Performance Management to your toolbox to help achieve your organizational goals.