Julie Lock explains the key steps involved in making the switch from outdated annual appraisals to real-time performance management.
The annual appraisal is a practice dating back to the middle of the 20th century – a time when work was stable, predictable and repetitive. Very little changed in a year.
Contrast that with the working environment of today – a world of varied roles, time-saving technologies, project work and constant change. Performance reviews as an annual event no longer cut it. Worse still, they serve to disengage and demotivate employees, while placing an unnecessary burden on HR and managerial staff.
In short – annual appraisals benefit neither employees nor employers.
The new way of managing performance
As a result, forward-thinking organisations are replacing annual appraisals with real-time performance management – a process that saves time, engages employees, and promotes good management practice. In this system, employees receive on-the-spot feedback and coaching from their managers, as and when it’s needed.
This transition represents a major change not only in process, but also in culture. HR professionals, now freed up from the administrative burden of annual appraisals, will be heavily involved in implementing real-time performance management. Here are some key points to consider.
- Managing check-ins
In order for this new approach to work, HR departments need to consider how performance check-ins are managed and scheduled, how feedback is recorded, and how to ensure that they actually happen.
Thankfully, this has never been easier – HR software packages allow you to manage all aspects of the process, from scheduling check-ins to logging feedback and progress, creating accurate real-time data on your entire workforce.
- Preparing managers
Real-time feedback promotes a more hands-on approach to performance management. Managers will need to be equipped with the necessary skills to encourage, coach and mentor their people – and have difficult conversations where necessary. Not all managers have well-honed people management skills, particularly those set in their ways.
It will be up to HR to ensure that managers are well prepared for the new era of performance management.
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- Creating a sense of direction
Creating a set of core values gives your employees something to get behind – a sense of direction, shared goals, and the feeling of being involved in the bigger picture. Real-time feedback helps both employees and managers align their work and goals to these values, promoting employee engagement and long-term success.
HR professionals will be key in driving home an organisation’s mission statement.
- Promoting a new culture
It’s time we moved away from unapproachable bosses and intimidating work environments. Real-time feedback promotes a modern, inclusive and collaborative work culture, where employees can approach managers for feedback or advice as and when they need it.
Under this system, managers double up as coaches and mentors. This helps steer people and projects in the right direction, treating underperformance as something to turn around rather than punish. For this to work, this new way of thinking will have to be applied from top to bottom.
- Building a wider HR strategy
Real-time performance management can be seen as part of a wider talent management strategy. Together with succession planning, ongoing training and development, and fresh engagement practices, you’ll build a brand that attracts and retains top talent.
This is all common sense. The benefits to real-time performance management are clear:
- If we start engaging employees through effective, real-time feedback, we’ll have a happier, more productive workforce.
- If we eliminate bad management practices, we’ll promote a culture of open communication, bridging the gap between employees and managers.
- If we release HR staff from the administrative burden of annual appraisals, we’ll free them up to engage in forward-thinking HR strategy.
- And we can do all of this while saving time and money.
Introducing check-ins brings a change in culture and requires more than just training on the new process. First you’ll need to educate the workforce, ensuring everyone realises the benefits of real-time feedback and how it will help them.