Editor's Note: Take a look at our featured best practice, Objectives and Key Results (OKR) (23-slide PowerPoint presentation). Successful organizations are using Objectives and Key Results (OKR) now. OKRs are efficient way to track company and team goals and measure their progress. It helps every organization's success by cutting out unimportant goals and focusing on what truly is important within the organization.
OKR [read more]
Also, if you are interested in becoming an expert on Performance Management, take a look at Flevy's Performance Management Frameworks offering here. This is a curated collection of best practice frameworks based on the thought leadership of leading consulting firms, academics, and recognized subject matter experts. By learning and applying these concepts, you can you stay ahead of the curve. Full details here.
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We’re all cognizant of the term “Performance Appraisal.”It refers to the methodical approach of employee’s performance, and the evaluation is done to understand the abilities of each individual for further career development. Regardless of how important the process is, to improve the overall organizational efficiency, inevitably we face certain challenges.
- When you’ve worked in a company for a period of time, you’re likely to be opinionated about the fellow employees. Hence, at the time of yearly appraisal, there’s a biasedevaluation based on the previous professional conflicts of interests. Also, in some cases of appraiser’s chosen favorites, those are benefitted despite of poor performance.
- Sometimes the assessment is done for the sake of it. There’s no aim for actual development. The employers will give periodic lectures on how to improve the conduct of work, but they won’t give individual attention. This also makes the employees disinterested in the evaluation process, and hence they begin to resist.
- Employees don’t feel motivated to perform better as there’s no reward linked to the evaluation. Neglecting the evaluation, they don’t get a raise or promotion. Therefore, the mediocre work done in the office hours, never result in advancement of business.
Here comes in light, Performance Management – a process by which managers and employees work together to plan, monitor and review an employee’s work objectives and overall contribution to the organization. Performance management is the continuous process of setting targets, analyzing the progress, and providing on-going guidance and feedback to ensure that employees are meeting their objectives and career goals.
Difference between Traditional and Modern Approach to Appraisals
Solutions by Performance Management
Review Frequency
Most experts agree that frequency is the key to boost Performance Management. To really reform, employees need to witness regular, steady, enduring progress. That’s constant momentum. The further the momentum generated, the superior the employees become in their job to accomplish aims.
The employee performance needs to be discussed daily. When the corporation notices potential as well as better results, it should contemplate to offer raise, promotion or bonus.
360-Degree Assessment
In order to prevent the unstable review methods and its adverse complications, it’s suggested to practice 360-degree assessments. In a 360-degree assessment, managers, co-workers, and assistants would have a straight say in a colleague’s evaluation. Moreover, a robust performance in a unique area might counterbalance a poor performance in alternate one. Hence, the 360-degree assessment provides a considerable balanced understanding of an employee’s input to the success of the business.
Appraisal Software
Performance management software carries about performance automation, which handles the ordinary features of reviews. With automation, corporate leaders can do more to upgrade performance in shorter time than before. Reviews are being led entire year with extremely distinct and personalized methods. The main advantage of technology is that it offers a more proficient and operative tool for bagging and distributing information.
Better Follow-up
Modern-day technology permits for simpler compilation of data. An employee can now obtain additional feedback from further sources. Technology also allows for a better and impartial view of genuine performance on a project, and therefore ends in actual behavioral modification. It also recovers the custody of performance records or feedbacks in order to gain an efficient follow-up result.
Focus on People and Relationships
If managers maintain good relationships with their employees, a fair positive growth in performance can be observed. Employers need to understand that improving real relationships with their crew and investing in them every single week, helps employees to have a shared goal in their mind to work on.
The real aim of performance management is to construct greater performance for an employee and enterprise. The chances of this phenomena coming into existence is when frontrunners take an energetic interest in people.
Performance Appraisal is still growing, yet substantial practice which can cause a number of effects in various organizations. But, employers should ponder about the beneficial outcomes and apply it in a more enthusiastic way. Performance Management requires more efforts and engagement from the authorities’ end, but it is worth all efforts. The solutions offered by this, are exceptionally effective and easily applicable.
As John Wooden said, “Don’t mistake activity with achievement.” Hence, Organizations are bound to focus on every aspect which can help shine their respective businesses.
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Performance Management (also known as Strategic Performance Management, Performance Measurement, Business Performance Management, Enterprise Performance Management, or Corporate Performance Management) is a strategic management approach for monitoring how a business is performing. It describes the methodologies, metrics, processes, systems, and software that are used for monitoring and managing the business performance of an organization.
As Peter Drucker famously said, "If you can't measure it, you can't improve it."
Having a structured and robust Strategic Performance Management system (e.g. the Balanced Scorecard) is critical to the sustainable success of any organization; and affects all areas of our organization.
Learn about our Performance Management Best Practice Frameworks here.
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