The modern day performance management process

Performance management starts at the very beginning of the hiring process, when a job is defined. From there, it involves continuous evaluation of employees' work to ensure it meets or exceeds expectations.

Today, some form of performance management is practiced in most organizations, but it’s not always practiced in a manner that motivates employees. In order to improve performance management, companies must create a work environment that empowers employees to perform to the best of their abilities by providing continuous development opportunities, as well as continuous feedback and coaching.

At its core, performance management involves goal-setting, evaluation and reward. When performance management is done well, employees become more productive, profitable and creative contributors. Here are four steps HR professionals can follow to effectively implement the performance management process.

Plan Goals and Set Expectations

In order to kick off the performance management process effectively, HR managers must start by writing clear job descriptions and creating a recruitment plan that attracts candidates that fit the company culture and meet position requirements. Once the ideal candidate is found and hired, managers should prioritize discussing expectations with them, and setting achievement goals.

It's essential for employees and managers to be on the same page in terms of expectations and goals so employees know what is expected and what to work towards, while managers develop an understanding of what type of ongoing training they'll need to provide. One performance management best practice is to make sure employees are involved in this planning process from the start, so they can envision how their personal goals will fit into the larger goals of the company, how they will be held accountable for their work assignments and how certain tasks must be completed.

Assess Progress Holistically

While it's important to take time to discuss goals and responsibilities when an employee first starts, an equally important part of the performance management process is to continually check in with workers. Rather than limiting this check-in to an annual performance review, managers should incorporate more informal, ongoing feedback conversations to monitor progress and address challenges.

This feedback can consist of comments from coworkers or clients, observations from managers or an employee's own evaluation of their performance. Ongoing feedback can help create a work culture where employees feel comfortable seeking help and guidance, rather than trying to hide or self-solve a problem. More formal reviews can be a valuable part of improving performance management as well; use these reviews to discuss overall highs and lows, assess skills and set bigger goals for the coming year.

Don’t Overlook the Power of Recognition

Taking the time to recognize employees' accomplishments is a complementary part of performance management. Depending on the organization and budget resources, recognition may take the form of bonuses or promotions, a written thank-you note, a verbal conversation or a formal rewards system.

No matter what form recognition takes, it's incredibly important for employees to hear that they are valued and why. Only 26 percent of U.S. employees believe they are recognized to the same extent as similarly performing peers, with only 10 percent of Gen Z feeling that this feedback is a core piece of their employer’s culture. Recognition should be an ongoing part of the performance management process—make sure it is public, personal and timely.

Provide Ongoing Career Development Opportunities

The final phase of the performance management process is to help employees set and achieve long-term career and personal development goals. These goals should reflect business needs, but also build on the specific talents of the employee.

Ongoing career development opportunities may include on- or off-site training, a challenging assignment or taking on new and bigger responsibilities. Manager and employee communication is a key part of this process; employees should feel free to experiment and make mistakes, be honest about what they want to pursue in their career, and know that their manager will advocate for them and help provide the training they need to achieve their goals.

Good performance management should be a part of day-to-day work life. By routinely meeting with employees, incorporating ongoing feedback and providing learning and development opportunities, managers can create a performance management process that empowers employees to set meaningful goals tied to business strategies.

Looking for a way to capture and track organizational and developmental data from continuous feedback and annual performance reviews? Cornerstone’s performance management solution can help your company identify and close skill gaps, track the progress of goals and better inform talent initiatives with rich data.