Performance Management. Just the mention of the words brings a heaviness to the heart, and a long sigh to many. The face to face method of reviewing an employee's performance itself could be due for a review of its own. Widely regarded as cumbersome, awkward and stressful by employees, yet so beloved of company managers, that difference alone should highlight the fact that there is a bridge to be built here. Maybe a more integrated and collaborative approach is called for. And there must be questions to be asked. Is there any real value in an annual meeting between an employee and their manager to discuss their work over the previous year? What are the barriers to employees fully engaging in the process? Can the business positively gain from the process? How do we monitor more effectively? And, of course, there is the age old question of cost.
We know that performance management should be both strategic – bringing focus on corporate objectives and business goals, and integrated – ensuring that all aspects of the business are closely aligned in the interests of the long term business strategy. Through improving performance in individuals and teams, and in providing the support of continuous development, organisations can maintain focus on long term growth.
Feedback on an employee's performance should be an ongoing process, something they can access and gain benefit from continually. In order to understand new methods and systems for performance management, companies should first look at their expectations of the process, seeing the review of individuals as reflective of a review of the entire operation, and target the results towards the long term goals of development and growth and profitability.
Businesses now recognise the need for a new, faster, more comprehensive and cost effective performance management solution. An easily accessed, multi-purpose platform for aligning individuals' goals with that of the employer, enabling greater engagement and productivity.
Goldman Sachs recently announced a major change in the way it reviews its 36,500 staff. The investment bank has also decided to scrap its much unloved system of rating its employees numerically on a scale of one to nine. Instead of improving employee performance, this system lowers morale and employee engagement, and is often seen as negative, counter-productive and divisive, focussing as it does on weaknesses instead of strengths.
Head of Human Capital Management at the bank, Edith Cooper, said they would give employees “more direction with respect to how they can improve”, rather than simply judging and grading their performance over the previous year. To that end, Goldman Sachs are looking at a “safe digital space”, a method which will allow employees access to continual constructive feedback. An online system gives ease of access for managers and employers alike. Reviews can be written easier and faster, and routed directly to HR departments for appraisal. Employees benefit by greater access to feedback. The need for paper trails and endless signatures being sought is negated, and that heaviness of the heart is lightened on both sides of the table.
Online systems can be customised to feature built-in tools to assist in the writing of reviews, and suggestions of advice on training employees on areas for improvement as well as competencies. As well as this, such continuous systems can provide employers and managers with the ability to track employees' performance all year round, rather than the previous methods of retrogressively over viewing the previous year, and this gives more accuracy. Time is a precious commodity. The book publisher HarperCollins recently moved from their previous, lengthy paper based PR process to an automated online system, and reported a 98% completion rate in half the time it would have previously taken.
With increased access to performance data, managers can stay informed at all times of employee performance and are better placed to offer guidance, or extra training as and when necessary to help the employee reach goals and deadlines. Key to the success of any performance management system is its ability to align individual and corporate goals closely, and this practice in itself leads to enhanced employee engagement, allowing employees to focus on best practice, leading in turn to increased productivity, and by extension, increased profitability.
Anthony Fincham, head of employment law at City law firm CMS Cameron McKenna, when interviewed on Goldman Sachs' announcement, said “Every employer of any size has performance reviews, typically annually. Few have a consistently good experience of them. In many ways, continuous feedback makes better sense than a single annual review. Goldman Sachs is not the first employer to do this online”
In this age, with Generation Y - the digital natives of this new world expecting to be able to work almost exclusively online, organisations can only benefit by disposing of outmoded, laborious methods of people management. New ways to invest in their people. New paths to a new future, new ways of helping employees to develop both individually, and as part of a forward facing organisation. Maybe it is time to manage the performance of performance management.