Performance Management – Have you ever found yourself thinking:
“I guess I really should focus more on managing my employees, because I know there are some areas of their performance that needs improving. But there are so many other things I need to do it just doesn’t make it as a high priority.”
“I need to improve employee performance but I’m a business owner, I’ve never been to management school. I don’t know enough about how to get the best out of people. I’d rather do nothing than mess it up.”
“I know performance management makes some sense –but here’s what I don’t understand. Why don’t my employees don’t just do what I want them to do?”
You have? Well believe me, you’re not alone!
Over the last 15 years I’ve worked with hundreds of business owners and managers in organizations probably very much like yours. Many of those people are, by their own admission, not taking action to improve employee performance through performance management. Of course on a day by day basis they manage their employees – they answer questions, allocate work, check some of that work, maybe even hold some team briefings.
But what they most often don’t do is apply a focused and structured system to make sure that their employees are ‘effectively managed’.
The type of ‘effectively managed’ that:
- Improves employee performance
- Boosts your business productivity and profitability
- Improves customer satisfaction ratings
- Lowers your staff turnover
- Improves your employees level of job satisfaction
How do we know that performance management actually improves employee performance?
There’s a lot of research around employee performance management and employee engagement. Here are some examples to help us understand how ‘effective management’ improves employee performance.
In a Gallup study of performance at unit level, covering more than 200,000 employees across a dozen or more industries, teams that rated managers highly on four factors were more productive and more profitable. They also had lower staff turnover and higher customer satisfaction ratings. So, what are the four factors?
- Knowing what is expected of them
- Receiving positive feedback and recognition regularly for work well done
- Having a role that fits their abilities
- Having a manager who shows care, interest and concern for each of them
Gallup research in the US on employee engagement shows that during the ‘heat of the recession’ (2008 – 2009) employee engagement has remained relatively stable. Before we begin the celebrations let’s take a look at what ‘relatively stable employee engagement’ means .
- 28% of employees are ‘Engaged’ – passionate, connected to the company, driving innovation
- 51% are ‘Not-Engaged’ – checked out, sleepwalking, and putting in time not energy
- 17% are ‘Actively Disengaged’ – actively unhappy, with the emphasis on ‘actively’
So, although employee engagement hasn’t plummeted during the recession, that’s still just 28% of employees with the engagement levels that our organisations need to be effective. Gallup says:
“Managers who focus on just a few items can enjoy a big payoff not just for their team but for the organisation as a whole.”
The few items:
- Making expectations clear
- Providing frequent feedback and recognition
- Encouraging development
- Helping workers connect their efforts with the mission and purpose of the company
Proudfoot Consulting’s Annual Productivity Survey for 2007 shows that on average, including studies undertaken in the US and UK, over 18% of working hours are unproductive (taking into account an optimum ‘labour utilisation’ time of 85%)
Here’s what they say about the reason:
“Whatever business you’re in, pay particular attention to the calibre and capabilities of those who directly supervise frontline workers. Poor worker supervision has always been a prominent reason for wasted working time in our Business Reviews and in the last two years has risen to become the dominant factor.”
What does the research mean to you?
It doesn’t take a genius (which is lucky as we don’t have one here) to see that the research points to a number of key actions that make up the idea of ‘effectively managed’ – the type of ‘effectively managed’ that improves employee performance;
“Effectively managed” is…
Making your expectations of your employees clear
- Helping employees connect their efforts to the mission and purpose of your business
- Frequently giving feedback and recognition
- Encouraging development and helping employees match their abilities to their role
- Showing care, interest and concern for your employees
The practical application: performance management
So how do you apply these actions? Here is a five step system for improving employee performance through effective performance management:
5 STEPS TO IMPROVING EMPLOYEE PERFORMANCE WITH PERFORMANCE MANAGEMENT
Performance Management; Is it time to assess yourself?
Is it time to assess yourself / your managers against this 5 step performance management system so that you can identify where you need to improve?