Wednesday, July 8, 2015

From Performance Appraisals to Performance Optimization

Most organizations fail to manage performance effectively because they fail to look into the system holistically.

Managing performance is a wonderful idea! But too many companies ignore the difference between doing PA (Performance Appraisal) and actually being proactive in performance management. In fact, in performance management, much less time should be spent on evaluating past performance, but moving to removing barriers to future performance. You can ask yourself some questions to move in the right direction like how frequent feedback will add value to your organization and the employees, what are the organizational goals and what value can performance evaluation add to it? What rewards should be linked to performance evaluation and how these rewards will affect the productivity of your employees and contribute to the organizational goals?

From Performance Appraisal to Performance Optimization: It is essentially moving away from appraisals of performance to managing and optimizing future performance. The performance review process should be used as a coaching tool; to not only let the employee know how they are doing, but to let them feel as though they have a voice, and they are an integral part of the company. This is usually the problem when performance appraisals are viewed as a judicial process rather than a helping process. This becomes very obvious when the manager makes judgment during the process rather than takes a helping stance. The appraisal can be the venue for finding solutions and effective methodologies rather than setting the blame on people. If we look at appraisal as helping, people would tend to open up and take comments more positively which is helpful in performance improvement. But if the tone of the discussion is judgmental, people become evasive and protective of their own welfare, and the discussion will not be productive as each party builds shields and weapons. But when instead, bridges are built, then movement toward achieving goals is facilitated, and a positive climate in the organization is built.

Strengths Finder: If people know their strengths and managers help them work in those strengths, employees get to do what they do best everyday and performance is maximized. It drives engagement, productivity, profitability, and employee retention. Who doesn't want to know more about who they are and what their strengths are? They are hungry to know how they did and what the results mean! It's human nature. The key element to successful review processes is not in how good the framework or tools are, it is the quality of the proactive conversations that take place. If the focus is shifted to investing in leadership abilities that build and support such necessary conversations; focus on building success for the individual through identifying their challenges and what is needed to support them to achieve within their role. When frequent conversations take place that focuses on building success for the individual, then the formal organizational requirements can be achieved by summarizing all of the conversations throughout the required timeframes. So it's necessary to have a SYSTEM in place in organizations. It isn't enough to just "talk," but it has to be a systematic and holistic solution.

"SMART" goals mapping: Managing performance requires a system with component parts that all work together. Starting with SMART goals is a good way to assess employees because the employees are the ones to establish their SMART goals based on the manager’s SMART goals which roll up into the organizational goals. This way ensures that everyone is working towards that company's goals and also towards their own goals that will have a positive impact on the organization as a whole. SMART goals allow for a mid-year and end of year formal appraisal but also allows for an ongoing discussion between the manager and employee. This method also gives the employee control over their appraisal/performance, if done correctly, it establishes a two-way communication on regular bases between employee and manager. The measurement and timely communication of performance is a useful tool that will assist in the achievement of a unit/organizational goals. As such the process of defining and the creation of personal and unit objectives must be constructed within the goals and objectives of the operational plan. The role of HR as the lubricant makes the whole operation move with respect to people and improve overall business performance.

Performance Management as an ongoing process: Performance-based management requires that the measurement and communication of performance be an integral part of an ongoing process and not an annual, quarterly, or monthly event. Much of the stress engendered in performance evaluation is created by the after-the-fact practice of communicating results. The employee's apprehension builds as the date and time draw near to discover how well they did. Any manager that communicates by using the oh-by-the-way method has failed the employee, the company, and his/her self. The purpose of the performance discussion is not to ambush the employee, performance appraisals used in that manner will guarantee ongoing employee and management friction that will cause things to cascade down. You can not manage performance after-the-fact.

Most organizations fail to manage performance effectively because they focus on improving the processes or implementations of performance management or evaluation. They fail to look into the system holistically. Therefore, if you want an effective performance evaluation or management system, you need to shift your mindset from developing performance management processes or implementation to developing a holistic performance management solution that adds value to employees, organizational goals, and business results. It is important to create an environment where everyone feels as being part of a whole system and individual contribution can be achieved or improved with the system working with one goal: achieving what has been planned as a team. With this, the team leaders or department managers act and are viewed as catalysts and guides. If top management supports the plan and is willing to show that support during implementation, then you'll have a much better chance of success. Finally, framing all of your training and managing an ongoing Performance Management processes in a positive manner to focus on optimizing future performance and keep the end - business goals in mind as always.


Nice article, you have written clearly in your post about performance appraisals and performance optimization.I really like it. Thanks for the sharing informative blog. keep giving me updates.

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