Why Performance Management Might Be the Most Important Part of Your Post-COVID Company Plan
This past year has been chock-full of ups and downs. Between reduced hours, the move to remote work, forced adjustments of goals, furloughs, and even layoffs, COVID-19 has changed how businesses operate. In response, your organization has had to adjust performance management strategies. This has likely affected how you communicate with remote workers, how much you compensate each team member, and the opportunities you can offer to current and prospective employees alike.
We at Astron Solutions have experience helping organizations rethink their performance management tactics, especially in unpredictable economic environments. Now that we’re a year into the pandemic, we know how to better work in this current context, overcome common challenges, and how performance management fits into the picture.
What Is Performance Management?
Before going any further, it’s helpful to get on the same page about what performance management entails.
In simple terms, performance management is the process of reviewing employees’ work performance and development goals at your organization. This involves monitoring goal achievement, giving and discussing feedback, and using performance metrics to learn about current management tactics. By analyzing your successes and failures, you can better pinpoint your business’s strengths and learn from its mistakes.
Done well, performance management can motivate employees to engage with their work, boost productivity, and provide valuable insight into how you might improve your management approach. However, performance management strategies don’t look the same from company to company or team to team. What constitutes effective performance management will depend on your business’s goals and mission.
Continuous Performance Management vs. Annual Appraisals
The two common types of performance management are continuous management and annual appraisals.
Annual appraisals are the more traditional method, with around 65 percent of companies using it. This method involves conducting reviews once or twice a year to assess employee performance and set future goals. While this is a common approach, it is not usually the recommended one. This is because it involves extensive formal paperwork, allows significant amounts of time to elapse between reviews, and can cause anxiety in employees during “review season.”
Continuous performance management is similar, except it involves regular check-in meetings throughout the year and frequent real-time feedback, rather than annual performance conversations. This approach has become popular over the years, and many businesses now have specific tools to continuously track employee performance.
No matter which model you use, effective performance management requires cooperation between HR departments, managers, and employees. This is because performance management doesn’t just explore how individual team members can advance — it also examines the potential for the growth of your entire organization.
Why Performance Management Matters for 2021
The shift to remote work has made performance management even more valuable and relevant — here’s why:
1. Performance Management Encourages Employee Recognition
COVID-19 hit employee morale hard, with 65 percent of employers saying maintaining morale has been a challenge during the pandemic, according to a SHRM report.
This is where employee rewards and recognition come in! Ninety-four percent of employees who receive positive recognition daily are satisfied in their roles, and 69 percent of employees work harder when they feel recognized.
Recognizing and rewarding good employee work doesn’t have to be complicated. A simple appreciation email, a companywide shoutout, or a larger incentive like a GrubHub gift card or extra PTO day can go a long way. And this kind of recognition fits nicely inside a continuous, consistent performance management process. Through real-time feedback and performance discussions, you can both determine which team members to recognize and easily recognize them on the spot.
2. Performance Management Boosts Employee Engagement and Productivity
Keeping employees engaged in a remote environment can be tough, especially for an organization that moved to remote work for the very first time during the turbulence of the pandemic. Plenty of organizations have had to figure out how to pivot typical engagement activities and employee communications to the digital realm.
Once again, your performance management strategy can offer a ready-made system for employee engagement. Performance management opens a communication channel between employees and their managers, allowing for deeper relationships between the business and its employees. Plus, ongoing performance management cultivates a culture of support and encouragement, which helps employees stay engaged. When leaders are actively checking in with employees and helping them adjust their goals to the new context, workers are more likely to stay invested and productive, even if they’re not surrounded by their colleagues.
3. Performance Management Creates Employee Development Opportunities
An effective performance management strategy allows you to proactively keep up with employee development. With regular reviews and check-ins, you’ll frequently meet with each employee to discuss performance and progress on goals. This is also the perfect opportunity to bring up development opportunities and help employees craft their career advancement plans.
And given that a lack of development opportunities is one of the top reasons workers leave their jobs, you really can’t afford not to help employees grow professionally.
The specific development opportunities you offer will likely depend on your organization and your employees’ particular professional context, but common options include mentorship programs, eLearning courses, and allowing employees to rotate through different roles so they can get a sense of other responsibilities.
Collaborating with team members on their development plans shows them you believe they’re capable of more and prepared to support them for the long haul. If you don’t include career development plans in your performance management strategy, you’re missing out on attracting talented new hires and risking the retention of your current employees.
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Actively keeping up with your employees and monitoring their performance is always essential, and the pandemic has only made it all the more vital. As we continue navigating the changing economic landscape of 2021, be sure to prioritize your performance management strategy. Is your company really doing all it can to promote employee engagement and deepen the bonds between your leaders and workers?
Jennifer C. Loftus is a founding partner of and national director for Astron Solutions.