IN THIS CHAPTER

Understanding what a performance management process can do for your organization

Connecting the process to position success profiles and organizational goals

Checking in with and assisting employees

Getting a performance management program up and running

Conducting employee performance reviews and following up

Few management practices are more basic or prevalent than performance appraisals — the mechanism managers use to evaluate team member performance. And yet, because of the way in which work is changing, the way in which HR and managers manage performance is changing, as well. Even though many organizations still do an annual or quarterly review as part of their process, new workforce expectations and innovations in technology are driving a host of changes for performance management processes.

A 2022 Gartner study reported that 81 percent of HR leaders are changing their organization’s performance management process, and less than 20 percent of HR leaders believe that performance management is successful right now. These statistics support the need for changes in the way performance is managed. Yet it remains crucial that people leaders monitor the performance of direct reports, note which areas of job performance need to be improved, and then provide feedback to employees in a positive and constructive way. If these steps aren’t taken, it becomes very difficult to determine how people get promoted, whether they deserve salary increases, and what specific development opportunities are most valuable to them.

So, what’s the answer? Provide ongoing feedback. To do so, you need to develop a system whereby employees understand their current status and receive feedback and coaching ongoing. It’s up to you to help your organization implement a structured and systematic process that considers the realities of today’s workplace and the unique challenges and opportunities that exist within your business. As I point out in Chapter 11, raises, bonuses, and other types of rewards should be connected to your performance review system.

Employee success supports business success, and in earlier chapters, I highlight best practices for developing and growing talent. This chapter focuses on providing ongoing performance assessment. It emphasizes regular check-ins to ensure that team members are on track and focused on the right opportunities for growth.

Reaping the Benefits

Why should you put in the time and effort needed to create and implement an ongoing performance management process? The answer is that the long-term benefits of an effectively structured and administered performance review process far outweigh the time and effort the process requires. Here’s what a well-designed, well-implemented performance management system can do for your organization:

• Create criteria for determining how well employees are performing — and, to that end, make it clear how their responsibilities fit in with company and departmental priorities.
• Provide an objective — and legally supported — basis for key human resources decisions, including merit pay increases, promotions, and changes in job responsibilities.
• Verify that reward mechanisms are logically tied to performance.
• Motivate employees to improve their job performance.
• Enhance the impact of coaching that is already taking place between employees and their managers.
• Establish a reasonably uniform set of performance standards that are in sync with company values.
• Confirm that employees have the skills or attributes needed to successfully fulfill a particular job.
• Create ongoing connection in the supervisor-employee relationship.
• Give underperforming employees guidance that can lead to better performance.
• Provide real-time feedback to keep employees focused on business goals and objectives.
• Help employees clarify career goals.
• Validate hiring strategies and practices.
• Reinforce organizational values.
• Assess learning and development needs.
• Motivate employees to upgrade their skills and job knowledge so they can make a more meaningful contribution to the organization’s success.

These benefits can only be realized through a performance management system that is ongoing, encourages regular check-in, and is connected to other talent activities. Figure 16-1 provides an example of an ongoing performance management process that’s aligned with organizational and departmental goals. As you can see in this sample process, weekly huddles and monthly one-on-ones with team members to check in on progress drive connection and understanding so that leaders can coach team members in the moment. The key to this process is this: It’s ongoing. It’s not dependent upon an annual evaluation but instead, ensures that feedback and coaching on performance are a regular part of the culture.

Leveraging a Process that Works for Your Organization

The first step after you’ve decided either to introduce a performance management system in your organization or to change your current one is to determine what is best for your team members based on your business goals and the culture you are trying to create. All performance management systems have the same goal: to establish a systematic way of evaluating performance, provide constructive feedback, and enabling employees to grow and continually improve their performance.

The basic ingredients in all systems are pretty much the same: setting performance criteria, developing tracking and documenting procedures, determining which areas should be measured quantitatively, and deciding how the information is to be communicated to employees. Where different methods vary is in the following areas:

• The degree to which employees are clear about success criteria from the position success profile.
• How employee performance is tracked and documented.
• How performance is rated and how it aligns with corporate priorities, goals, and objectives.
• The specific types of appraisal tools used. In some cases, for example, certain approaches are more appropriate for evaluating managers and professionals than other employees.
• The amount of time and effort required to implement the process.
• How the results of performance conversations are integrated into other talent processes.

Anchoring to the Position Success Profile

When assessing an employee’s performance, it’s critical that the parameters you’re using are fair and appropriate. The best way to ensure this is to use the position success profile as the primary guideline for assessing the employee’s value to your organization. After all, the position success profile defines what success looks like in the role, so obviously, it’s the place to start. Evaluating team members on criteria that fall outside of their position success profile isn’t fair to them — or to you and the business.

In Chapter 5, I introduce the position success profile as the blueprint for success in a role, so the position success profile is naturally an integral part of all performance management systems because it outlines what success looks like in the position. The performance review conversation is a great opportunity to review the outcomes and competencies necessary for success in the position and identify growth points.

The two aspects of the position success profile that are most valuable in the performance management process are the outcomes (what was accomplished) of the position and the competencies necessary for success (how it was accomplished).

Aligning to Organizational and Department Goals

Team members want to add value. They want to know that what they do every day is supporting the organization’s success, so it’s important that managers provide help to connect the dots — how team member work supports department and organization goals.

Organizational goals communicate what’s important, and when employees are clear on the goals, they can plan and execute their work based on those benchmarks. Organizational goals take the company’s overall strategy and break it down into manageable chunks, providing checkpoints along the way to reach the overall strategic mark. So when working with team members to set goals, start with the organization’s goals. Then, align with the department goals. That way, team members know exactly how they are contributing to the bigger picture, and as the bigger picture shifts, you can adjust team member goals accordingly.

It's critical to involve team members in the goal setting process. Unless employees are determining the goals themselves (with their leader’s coaching and support), they aren’t likely to buy into them or feel the same sense of ownership. A 2022 Gallup report notes that employees whose managers involve them in goal setting are 3.6 times more likely than other employees to be engaged in their work.

These sections provide additional insight into the best ways to maximize team member goals.

After your organizational and departmental goals are clear, team members are well positioned to create individual goals in support of the bigger picture. The SMART goal approach is a tool that has been used for decades to help team members and leaders create and accomplish their goals.

SMART is an acronym that stands for the following:

• Specific: The goal should be specific, so that it isn’t misinterpreted or confusing.
• Measurable: The goal should allow you and the team member to track progress.
• Achievable: The goal needs to be realistic and something that the team member can actually do.
• Relevant: A relevant goal is aligned with the organizational and department goals and direction.
• Time-bound: There needs to be a target date for completion.

By setting clear SMART goals, your team members have clear parameters to stive for. This allows the manager to focus their performance conversations on the right things.

Checking In and Holding Regular One-on-Ones

The best leaders know their team members — they know their strengths and weaknesses, and they connect with them regularly about their work and their needs. In a performance management model that is ongoing, leaders who are in touch with what’s happening with their team members have a natural rhythm for acknowledging what’s working well and what’s not working as they are working toward their goals. One way to ensure an ongoing rhythm is to create a regular schedule of one-on-one meetings or check-ins with team members. These meetings can happen monthly, bi-monthly, or weekly depending on the nature of the work, the team member’s needs, and the relationship between the team member and the leader. For example, new team members will naturally meet more regularly with their leader as they are building a relationship.

Regardless of the frequency, here are some keys to maximize the effectiveness of these meetings:

• Protect the one-on-one time — do not cancel meetings. To team members, this time is important, so it must be important to the business and to the leader. Yet many leaders cancel meetings for “more important work.” The leader must create space in their schedule for this time. I believe that nothing is more important for leaders to spend their time on than team members. After all, leaders get results through their team, so they must pour into them.
• Balance the agenda, starting with their needs. This is time for your team member to share their experience. Give them the space to share whatever is going on with them and be a good listener. It’s important that the team member owns the agenda. Together, you can set some guidelines about the goals of the meeting, but ultimately, it is time for the team member to get what they need.
• Use a shared document to capture notes and action items: A shared document provides accountability for both the leader and the team member and ensures alignment on the conversation and agreement on action items.
• Get feedback from team members: The one-on-one is not only an opportunity for the leader to provide coaching and feedback, but it’s also an opportunity to get feedback from the team member on what’s working well, what’s not working, and what the leader can do to be more effective. This creates an environment in which it’s safe to voice concerns and talk through challenges.

Just-in-Time Coaching and Correcting Course

When managers create a relationship with team members in which there’s a high level of trust and a focus on achieving results, coaching, feedback, and course correction are natural. Yet many managers struggle to provide feedback and coaching. It’s in your best interest to coach and develop your managers so they’re equipped to provide feedback when they recognize that team members are off track or stuck. Here are the points to emphasize when encouraging managers to give feedback:

• Focus on why candor is important. The team member can’t improve if the manager doesn’t communicate the need. Additionally, if it becomes necessary to let a team member go, a manager’s failure to mention the employee’s weakness in a performance conversation can jeopardize the company’s ability to defend the firing decision.
• Stress the importance of documentation. Managers should always be prepared to back up critical comments with specific, job-related examples. The documentation for these examples should be gathered prior to the meeting.
• Highlight the importance of careful wording. Managers should be made aware that the wording of criticism is every bit as important as the behavior being described. Remind managers to focus on the behavior itself and not on the personality quality that may have led to the behavior.
• Encourage employee feedback. After managers have issued any piece of constructive feedback, team members should be given the opportunity to comment. Given a chance, team members will often admit to their shortcomings and may even ask for help.

Providing feedback and coaching employees go hand-in-hand. Often when team members are struggling to accomplish a goal, they need a coach to help them identify other ways in which to handle a situation. The GROW model for coaching is a helpful tool for leaders to use in the moment (see additional detail in Chapter 15).

Celebrating Team Member Successes

Celebrating success is one of the key drivers in motivating employees in the workplace. In fact, 78 percent of employees would work harder if they were better recognized, according to a 2019 Globoforce study. Increased celebration and recognition for work well done means happier, more engaged employees who are more invested in your organization and driven to produce great work, so they’re obvious additions to any performance management process. But in most fast-paced, results-driven environments, it’s typical to accomplish a goal and move on to the next.

Celebrating both big and small wins highlights for team members the impact that they are having on the business. Having a sense of accomplishment brings joy to the employee and also builds a spirit of community that benefits everyone, and there are countless ways to celebrate successes. Chapter 13 discusses specific ways to recognize team members.

Launching a Performance Management Program in Your Company

When you launch a new performance management program, you need to gather input from both senior management and employees to ensure buy-in and support — after all, the program is in support of their success. You also need to make sure that the program is workable and well communicated throughout the organization. The success or failure of a performance management system hinges on factors that are based more on company issues than on the system itself. The following sections list successful guidelines.

Identifying Keys to a Successful Review

Although the key to a successful performance review process is ongoing feedback and check-in, the more formal review meeting is still an important part of the process for many organizations. Whether it’s quarterly or annual, a more formal performance review meeting allows for documentation and alignment on how the team member is doing. This objectivity (versus informal performance conversations throughout the year) helps to support recommendations for salary increases and learning and development opportunities.

As with other aspects of your performance review process, equip managers to have these conversations. The truth is, most managers have not been trained to conduct an effective performance review session. So, although your managers may be responsible for what happens during the session, you and your HR colleagues are responsible for making sure that they’re prepared for the challenge. These sections provide specific details about getting ready and having these reviews.

Following Up on Performance Review Meetings

Because the goal of your performance management process is ongoing, managers will naturally have rhythms built into their day-to-day follow-up with team members. Between performance conversations, managers should be encouraged to remain easily accessible so employees can share thoughts, concerns, or suggestions on any of the topics covered during the appraisal. Managers should understand the benefits of providing input to team members ongoing throughout the year. If feedback is ongoing, nothing in the performance conversation will come as a surprise to team members.