Improving employee performance is now much more than enforcing your employees to clock in and out. It has become the secret to achieving greater organisational success. High employee performance is synonymous with increased profitability, reduced operational costs and improved efficiency.
To effectively drive and increase employee performance, a series of processes should be put in place to measure and reward the abilities of your workforce to meet and exceed organisational goals; this is known as performance management.
Performance management is too important for organisations not to get right. It should be embedded within organisations to serve as a tool to drive productivity, engagement and compliance. It will also help to assess how employees are performing in their jobs, align individual goals to overall organisational goals, and keep employees satisfied so as to retain them.
As important as performance management is to improved employee performance, fewer than 26% of organisations have enterprise-wide performance management systems, according to a research done by Bersin and associates.
5 Essential Components
With years of research and experience in this field, we have identified 5 best practices in performance management and they are:
a) Goal Management
b) Performance Reviews
c) Access and Administration
e) Reporting and Analysis
To ensure that your employees are performing at the highest levels, there is the need to ensure that they are working on the right goals. Below are five steps to effective goal management:
Performance review should be automated and integrated with individual and organisational goals to improve employee performance. The following steps can help ease off the once dreaded annual exercise to become a proactive process that ensures everyone in the organisation is on the same page.
Access and Administration
A critical key to ensuring that the performance management strategy is effective not only includes automation, but also easy access to information. By taking the following steps, organisations will be able to provide employees easy access to information. In addition, administration of performance management processes should be driven by best practice workflows that guide everyone through each step and these include:
Once performance data is in place, such data can be used to assign compensation cycles that fit the budget and meet the guidelines for merit and bonus allocation. The following steps will enable organisations to develop a pay-for-performance strategy to reward employees for meeting key objectives, and reap the benefits of reduced turnover, reduced costs, and sustained competitive advantage. Steps that must be considered include:
Reporting and Analysis
A good performance management solution provides the ability to capture and report metrics. Organisations can view key performance and compensation metrics through intuitive graphs, tabular data, and custom reports. This Talent Intelligence enables organisations to:
We have implemented these performance management best practices over and over again for leading organisations and we are confident that when effectively implemented, employees, managers and organisations always get the best from their performance management systems.
Bolaji Olagunju is the Lead Consultant and CEO of Workforce Group. He helps organisations with transformation and business improvement efforts via the design and deployment of service offerings in the areas of Strategy Planning and Execution, Organisational Design and Development, Corporate Universities/Academy Design and Implementation, Change Management, Performance Management Design and Implementation as well as Business Process Outsourcing.
He is a member of CIPD UK, SHRM, NIM, a Licensed Member and Test /Assessment Administrator of the British Psychological Society and a Certified ROI Practitioner.
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