I’m currently planning the salary review process for a client. The general principle is that we reward for performance. It’s something I’ve heard expressed many times before and on one level it makes sense. Why not give more to your best performers? The problem is that salary budgets have been low for years (less than …
Performance Management – how does it work?
Performance Management is a topic that has filled the column inches of late. With many US based tech companies seemingly abandoning traditional performance management processes, is the whole concept dead in the water?
Well to put it simply, no. Every company needs some way of being able to objectively review how their employees are performing. We all need clear manageable objectives so that we can assess whether we are delivering or not. So it’s not that performance management is dead, it’s just how it is done that has changed.
The end of the formal review?
Traditional performance management systems have involved objectives being reviewed in a formal meeting. This might happen only once at the end of the year. This encourages issues to be stored up and discussed several months after they occurred. This is counter productive and leads to stress and this is why companies have removed the formality of the process. What they have replaced it with is more regular informal check ins. So the process of performance management continues but it is in bite size chunks; a more informal in the moment process. At Cornerstone Resources, we would encourage this process. If most things are dealt with at the time they happened then the end of year review becomes a rubber stamping exercise. Therefore, everyone knows how they are doing and there are no surprises.
Performance ratings are also a topic of discussion. Some organisations have used forced ranking to give an even distribution of grades. This means you could be rated as poor even if you’ve hit your targets. We do not believe this is the correct way to differentiate between employees. However, objectives need to be set fairly and consistently so that performance can be evaluated objectively. In other words, good targets in, good measurement out. Keep your targets SMART.
Call Nicci on 07908 875146 or Rob on 07494 161169 for help and advice.
Performance Management has always been a tricky thing for organisations to get right. Traditional appraisal processes have relied on formal meetings and the completion of long forms which struggle to genuinely capture the contribution an employee makes to their organisation. Done badly, performance management is less a tool to develop people and more a weapon …