Why every organization needs performance management

There are many opportunities for HR to mentor, role model, test and advocate a more strategic approach to human capital

“We couldn’t have next year, if we didn’t have last year.” That was a favourite saying of one of the best bosses I ever encountered. It was his way of acknowledging that the pattern of activities over time helps anticipate what is to come. He used this approach as an opportunity to celebrate achievements, acknowledge employee growth and signal performance expectations. There was nothing static about his workplace.

Organizations and individuals benefit from taking the time to review recent events and chart a course of action for the future. There are many paths for such a review. Some are formal, tied to annual planning cycles or performance benchmarks. Others are more informal, making use of ongoing workplace processes.

Without performance review there is little sense of change or celebration in the workplace. Time drifts by. Events merge one into another. There is no taking stock of personal growth and group progress in meeting corporate goals. The excitement of stretch targets that challenge the individual and the group to deliver their best is missing. When it comes time for that all important job interview, the employee is unable to easily identify past work achievements.

Many assume the only route to performance management is the formal review process — the technique to capture in writing the expectations for work performance followed by the subsequent review of achievements and areas for improvement and the development of a plan to realize change. When this is tied to corporate goals and business priorities it can help everyone in the organization see how their work fits in the big picture.

There are all kinds of reasons why this type of review doesn’t happen or, if it does, why it isn’t working in a particular situation. Management, unions and employees can all conspire against the effective application of formal performance management. Managers may not know where to begin or how to engage staff. Employees may fear revealing their ambitions to managers or risking potential failure in making commitments for the future. The processes used, past experience and the simple lack of time can further hamper the use of formal performance management techniques.

This does not mean that performance management is at a dead end — far from it. For the strategic HR practitioner, there are many paths to performance management. The creative HR professional knows every workplace interaction is a potential performance management tool.

Workplaces set performance expectations in many ways. Job ads and job descriptions outline the nature of the work. The organization chart indicates the value and authority associated with different positions. Corporate materials designed to inform investors and potential employees convey a set of organizational values and a style of doing business. All these tools affect the way new employees approach work. These expectations are reinforced by information during employee orientation and in the informal interactions with management as employees learn on the job.

Bringing the corporate vision into focus

Many organizations adopt corporate value statements, service benchmarks or common performance standards to set themselves apart from competitors. Value statements such as “excellence in customer service” or performance benchmarks such as “same day response to inquiries” are performance measures. As corporate statements of intent, they apply to all staff. When these statements are brought front and centre into interactions with employees, they not only set performance expectations but they can also be used to manage performance.

Something as routine as procedures around workplace access and use of workplace property can have a major impact on employee attitudes. Any pattern of compulsiveness in the workplace can mask illness, incompetence or fraud. Whether it is abuse of overtime, personal use of computers or taking materials from the workplace for home use, lack of attention to these patterns on the part of management tells other employees these abuses will be tolerated and are not regarded as important.

Monthly reports and feedback from client surveys also link to performance expectations. Managers can use the monthly report not only to highlight key parameters that are important in achieving corporate goals, but also to track performance across work units or among employees. Feedback from clients and stakeholders further reinforces expectations for employee actions and demonstrates achievements and areas for improvement. Annual awards, by the themes chosen and the activities selected for recognition, let staff know what the organization values from its employees. Poorly managed, however, such programs can stifle the very teamwork and creativity they are intended to enhance.

Ongoing workplace programs such as health and safety can say a great deal about performance requirements. Health and safety as a legislated responsibility places obligations on the employer and the employee alike. Management sets the stage for the attitude to safety in the workplace through training on safe work procedures, the provision of safety equipment, the response to accidents and return-to-work protocols. Employee responsibility is in adopting safe work practices and following emergency procedures. Taken together, health and safety touches on how work gets done in the smallest office and the largest facility.

Many opportunities for HR to shine

There is a great deal anyone in HR, regardless of their position, can do to support a more strategic approach to performance management. This is true for the front-line practitioner, the HR manager and the HR executive lead. There are many opportunities for HR to mentor, role model, test and advocate a more strategic approach to performance management.

Without attention to performance management, everything can appear fine on the surface despite problems bubbling underneath. And then the organization learns the painful lesson of why performance management is important. With performance management, employees and managers work together on workplace growth and skills enhancement. Without it, the organization faces the potential of declining productivity, dysfunction, bad public relations and even scandal and litigation.

Susan Singh is the principal of Sumack Consulting. She is the author of two books by Carswell, Performance Management in the Public Sector, and HR Manager’s Guide to Applied HR Strategy written with Carol Smith. She can be reached at [email protected]. For more information about her books, visit www.carswell.com.

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