How to Select a Performance Management System for Employees

If you're looking for a new performance management system for employees it's likely you've uncovered problems with your current system, or you've reached a point in your growing business where you need to implement one for the first time. Remember that human resources processes are about developing people. Sounds obvious, but many performance management systems fail to deliver results if you don't focus on the key component: your employees.

How does a performance management system benefit employees?

Performance management is not simply the annual appraisal. It should be a continuous part of a productive work cycle that encompasses target setting, tracking, reflection and development. Don't just replace your annual review process with an online process. Performance reviews on their own generally focus on the past, and when done poorly the negativity that can creep in is extremely demoralizing.

Performance management for employees should be continuous, focusing on what's happening right now, what can be improved and what skills you should develop to further your career. A performance management system that looks ahead is far more motivating and results in:

• Engagement: feeling responsible for your own professional development fosters genuine engagement with your work, your colleagues and the business.
• Timely feedback: 82% of employees appreciate receiving feedback, regardless if it’s positive or negative. Regular feedback aimed at encouraging growth is a powerful motivator, and one that most employees actively seek out from colleagues and supervisors.
• Role clarity: getting visibility of the company's direction and aligning measurable objectives to that strategy allows you to see how you contribute in to your team and are valued at the organization.
• Structured development: a great performance management system focuses on employee growth, and gives individuals a structured coaching plan to develop the skills they need to progress.

Benchmark your performance management system with employees

In order to implement successful performance management you need to understand where and how your employees do their best work. The easiest way to start? Talk to people! Before you go searching for a new system, you need to benchmark the effectiveness of your current performance management processes. Find out what the issues are with your existing system - is it too complex, inflexible, difficult to use? Do employees feel that performance management keeps them motivated to do their best work? Take our benchmarking survey to get you started.

Define with leadership what you want to achieve through performance management

Based on the results of your benchmarking, pull out the main areas you're doing poorly and identify the problems you want to solve. What are the business outcomes that a performance management system should support for your workplace? Some of these could be:

• Creating more accountability for deliverables
• Deepening engagement with employees' work
• Giving more clarity in their roles and contribution to the organizational strategy
• Encouraging self development and employee empowerment
• It may even be to simply deliver more visibility to management about their team's priorities

Getting leadership involved is important to demonstrate the behaviors they want to see across the organization and to motivate others to join in. If you're struggling to sell the benefits of a new system, we've covered four main areas that really make performance management software worth the investment.

Identify the components of a performance management system that are most important to employees

• Ease of use. A great performance management system shouldn't take too long to learn the ropes and should be easy to access.
• Works where you work. Are the majority of employees desk-bound, remote, travelling? Your performance management system should not only be available on multiple platforms to be easily accessible, it should link in to the other systems where work takes place. Bringing performance management into the flow of work, rather than leaving it as a standalone task in itself, is the number one way to boost adoption of a new system.
• Provides structure and flexibility. Performance management should focus on developing the individual and giving them the tools they need to do their best work. Having a solid framework to start with is important, but so is allowing flexibility to tailor processes to teams and individuals.
• Actually improves productivity. Measurable outcomes, ongoing feedback and coaching, identification of strengths and skills and being creative about how to bring those into your organization.
• Brings clarity. Everyone thrives when they feel like they have a purpose. Performance management should encourage open communication, clarity on the organizational strategy and accountability for individual development.

A performance management system doesn't have to be online, but it definitely helps to automate your processes. If you're deciding to implement performance management software, we've covered nine features that every system should have to be effective.

Now that you're ready to revamp performance management for employees, our whitepaper on modernizing performance management processes will help you to set a project plan, define your deliverables and successfully roll out a new system.

A few more items to consider when selecting a performance management system for employees

• Be accurate and fair. Put in structures to be fair, transparent and accountable. Rating scales are extremely useful to measure overall results, but everybody needs to be on the same page about what they mean. Avoid manager bias by including multiple sources of feedback wherever possible.
• Train employees and managers. Recognize that the tool is not your culture, it's there to help you live that culture. Focus on formal coaching and skills development. Make sure managers understand the action steps they're expected to take.
• Respect people's time. Simplify your processes and allow for flexibility - it's about developing the individual, it's not a check-box exercise.
• Maintain a record of performance discussions. Not only is this important for employees and managers to be able to track improvements over time, it's a legal protection for your business.
• Aim for overall improvement, not just meeting baseline minimums. Personal development should elevate performance beyond the job requirements. Link performance management for employees to the overall strategy and communicate the big picture.

Selecting a performance management system for employees isn't an easy task, and the bottom line is you're going to want something that will be able to adapt and grow with your organization and your workforce as their needs change. You should be aiming to create a work environment that allows individuals to perform at their best, by the measures that work for your organization.