Just in case you didn’t know, the traditional annual performance management discussion is on the way out. An increasing number of companies are ditching the time-consuming, subjective and demotivating practices for new ways of managing employee performance.
McKinsey & Company have published an excellent article on this issue (read it here), complete with examples of companies that are implementing these new practices. Interestingly no one is suggesting the idea of performance management be abandoned, merely that it needs to morph into a much more effective process. Amongst the ideas raised in the article are the following:
- Rethinking what constitutes employee performance
- Instead of focussing on the middle ground, identify clear over performers and underperformers
- Highlight and encourage exemplar performances
- Automating real-time analyses
- Using apps for continual crowd-sourced performance data throughout the year
- Collected in real-time which is not only fresh, but enables managers to draw on actual evidence
- Severing the link between evaluation and compensation
- Link compensation to the performance of the company, not the individual
- Studies indicate that employees value meaning (seeing purpose and value in work) as the most important factor.
In handling performance management, it is now coaching rather than evaluating that is the key. The article list three practices that seem to deliver the results, these being changing the language of feedback, providing constant crowdsourced vignettes, and focussing discussions on the future rather than what happened in the past.
Performance management is changing, and companies that succeed will be the ones that change with it. The Avondale Business School can help you keep ahead in performance management. To find out how, simply contact Warrick Long on:
P: 02 4980 2168