The Secret to Effective Performance Management

Effective performance management is not the result of a well-written review form, or even an expensive software solution.  These are tools that can help, but they won’t magically make all of your managers experts at delivering performance feedback.  The key to successful performance management is training your managers to be good at it.

The ultimate purpose of performance management is to drive employee behaviors that contribute to positive business results.  This is why most companies are willing to invest time and money into the process, because they expect it to improve business results.  The best thing we can do to ensure that we’ll see a return on that investment is to provide recurrent and ongoing training that helps line managers to deliver effective performance conversations.

Here are some of the things that are important to include in performance management training:

1. Performance management does not equate to the formal review process.  Managing performance consists of regular and ongoing conversations about results.
2. People must understand what is expected of them in advance, or they can’t be held accountable for their results.
3. Performance reviews should never contain surprises since feedback is being provided along the way.
4. Performance is defined as results that advance the business, not effort or potential.
5. Scoring definitions must be clear to everyone in order to equitably score performance, and scores given must be justified by explicit results. 
6. Performance conversations and reviews should always contain specific examples of results or lack thereof.  Vague comments about performance don’t help anyone to improve.
7. Even if your company doesn’t have a formal 360 degree feedback program, seek out input from customers, peers, and others who interact with the employee.  Supervisors might not have a complete picture of this person’s output so getting feedback will help to properly evaluate results.  Make sure to honor the confidentiality of the source.
8. Provide opportunities for managers to practice providing feedback.  Provide performance examples and ask managers to write and/or deliver comments and scores for those examples.

This list is a good starting point for training, please use the comments section to list other items that will help to assure that your company gets the greatest return on its investment in performance management.

Darcy Dees works as the Compensation Manager for Rock Bottom Restaurants, Inc.,headquartered in Louisville, CO.  She has been working in Compensation for over 5 years now and recently attained her Certified Compensation Professional (CCP) designation.  She spends what little free time she has hiking and reading.

Comments

[Vita Taylor]

Great suggestions, Darcy.

I was recently speaking with a client, and she mentioned that her company was undergoing the installation of a new 360 degree feedback program for performance management. She commented that all the staff were to be trained on the new system. She went on to elaborate that this was the 3rd 360 degree program that the company had installed, during her years with the company. She was skeptical about this program's success, commenting, "We are all trained on the program, which takes a year, and then there is no follow-up or use of it afterward. It is never part of my merit pay discussion, incentive pay plan design, or any other reward."

So, I do see where it is critical to have a more integrated approach when it comes to performance management plans, regardless of the type.

There has to be clear, reinforced linkages between the performance system and tools and the pay systems we develop and administer throughout the years.

It is only then that the results will be seen from even the best of these plans.

[working girl]

I agree the manager plays the most important role in this process. Also, beware of too many goals. But I'm not sure you can drive all rewards by company performance alone because not all value added is direct.