Despite the skills of your people accounting for 85% of your company’s assets, as it turns out, we’re all pretty bad at performance management. Just 3% of organizations believe their performance management strategies are top-notch, and over 48% say they need work. So, if you resonate with that, we’ve got you covered.
This article will look at nine performance management strategies you can implement in your business today. Whether planning, monitoring, or reviewing your team’s performance, we’ll provide you with tips, tricks, and templates to take productivity to the next level.
IN THIS RESOURCE
Planning Performance – Management by Objectives (MBO)
The Management by Objectives (MBO) framework provides a central pillar for many organizations to manage performance. The MBO framework directs organizations to set aligned objectives at every level of the workforce, starting from the top.
From there, managers and employees set their objectives to align with their goals. This helps everyone pull in the same direction.
If you’re a leader looking to manage enterprise-level performance, we’d recommend some further reading on MBO.
If you’re a manager working to align your team’s objectives to MBO, you need a strategy to deliver the best productivity from your team. That’s where SMART goals come in.
SMART Goals
When it comes to setting performance expectations, we’d recommend SMART goals. SMART is a super effective framework because it provides clarity and focus while giving you, as a manager, confidence that objectives will be completed by a specific date.
Use the SMART framework to make sure all your goals are:
Specific
Focus on making the goal(s) as straightforward as possible. To do this, utilize the 5 W’s way of thinking:
- What is the purpose?
- Why is this goal important?
- Who is involved?
- Where will the goal be achieved?
- Which people/resources are involved?
Measurable
Make your goal measurable so that it’s easy to track progress. For example, rather than setting a plan ‘to increase sales,’ try framing it as an ‘increase sales by 20%’.
Achievable
There’s no point in setting someone an unrealistic goal. Ensure that you and your team members agree that a plan is possible. If the goal is too ambitious, you’re setting yourself up for failure and will de-motivate the team straight away.
Relevant
Ensure that any goals you set apply to that individual. Setting a goal that isn’t worthwhile is a waste of everyone’s time and won’t lead to a boost in productivity.
Time-bound
Every goal needs a target. By making your goals time-bound, you and your team ensure the goal has the priority it needs while assuring you of when it will be done.
Following this structure makes SMART goals straightforward to adopt, making this one of the most actionable performance management techniques. In addition, it provides a solid foundation for managers and team members to work from to move forward in achieving your goals.
KPIs
Key Performance Indicators (KPIs) are essential underpins of SMART goals. You can think of KPIs like checkpoints your team needs to pass in order to achieve their SMART goals.
Setting KPIs helps you monitor progress (more on that later) against goals, allowing you to celebrate success or course-correct shortcomings before it’s too late. KPIs should also follow the SMART framework to ensure you’re maintaining the right level of detail and accountability.
Let’s expand on our sales example from earlier, imagine today is the 1st January 2022:
You’re a sales manager, setting your team the following objective:
- By 31st December 2022, increase product sales by 20%.
Underpinning this SMART goal, you set the following KPIs:
- By the end of Q1, increase the sales of product ‘A’ by 5%
- By the end of Q2, increase the sales of product ‘A’ by 10%
- By the end of Q3, increase the sales of product ‘A’ by 15%
While this is a simple example, the KPIs allow you to track the team’s performance towards the overall SMART goal.
Speaking of tracking progress, let’s look at ways to monitor your performance management.
Monitoring Performance Management
1:1 Meetings
The backbone of monitoring performance is for managers to conduct regular 1:1 meetings with their team. These sessions give team members the chance to update their progress, brainstorm new ideas, and receive guidance.
For managers, it gives you the chance to keep an eye on progress and offer advice to maximize performance. Ultimately, you’ll know how often to have these 1:1 meetings, but the best practice is weekly or monthly.
But, given that 63% of Gen Z employees say they want more feedback throughout the year, you need to make sure your 1:1s are delivering real value.
Real-Time Feedback
But remember that you don’t need to wait for formal 1:1 check-ins to give feedback. For example, 80% of Gen Y employees say they prefer on-the-spot recognition over formal reviews, so they also work on providing regular real-time feedback.
How can you do this? There are loads of ways, but tools like Grow allow you to do this instantly through tools you already use, such as Slack and Teams. Thanks to our in-app templates, it’s quick and easy and helps teams feel up to 91% more appreciated.
And that’s not all, with Grow, you can:
- Foster a culture of continuous feedback
- Help your team feel supported and grow together
- Encourage a growth mindset on your team
- Live and breathe your team’s values through feedback
Reviewing Performance – Start, Stop, Continue Feedback
You’ll want to sit down with your employees at specific points in the year to undertake a deeper performance management review. Here managers look more broadly at team member performance and suggest ways to improve long-term.
Start, Stop, Continue feedback is one of the most popular and easy-to-use performance review templates used by managers and leaders across the globe. That’s because Start, Stop, Continue feedback breaks down into three straightforward questions from team members:
- What should I start doing?
- What should I stop doing?
- What should I continue doing?
As you can see, the framework offers well-rounded feedback by highlighting areas of strength and weakness to deliver the perfect blend of praise and constructive growth points.
Check out our Start, Stop, Continue feedback guide to learn more about how it works in action.
Reviewing Performance – 360 Degree Feedback
Like Start, Start, Continue feedback, 360 Degree feedback is another popular framework for conducting detailed performance management reviews. However, the real USP with 360 Degree feedback is that individuals get feedback from between 4 to 8 peers and direct reports and their manager.
360 Degree feedback is also designed to be far more in-depth. That level of depth tends to make those giving the feedback feel uncomfortable. For that reason, 360 feedback is usually anonymous and managed through a dedicated HR/feedback software tool. For both the individual and the manager, 360 Degree feedback shines a light on areas to improve and paves the way to improved productivity.
Reviewing Performance – Reward & Compensation
As human beings, we all love being rewarded. Therefore, when reviewing performance, rewarding and compensating your team should be used to recognize outstanding performance and incentivize improvements.
Many organizations will link yearly bonuses to performance, encouraging teams to over-perform in exchange for a cash lump sum. But remember that reward isn’t just in salary. Incentives such as additional training, development, annual leave, charity donations, and environmental projects also serve great motivators.
For instance, at Grow, we plant real trees when our users provide each other with feedback, meaning when you Grow, the planet grows with you.
Reviewing Performance – Personal Development Plan
Performance management reviews should always finish with a look forward into the future. So while you’ll set new SMART objectives, as managers, you should work with your team members to create personal development plans.
These plans help employees grow their skills and experiences to accomplish their career aspirations. Actions on a PDP may include:
- Undertaking formal training
- Taking on secondary responsibilities
- Finding a mentor
- Shadowing other people within the business
While designed with the employee in mind, any personal growth is likely to improve performance, so everyone’s a winner when it comes to PDPs.
Summary
Regular, structured performance management is the perfect way to unlock team productivity. Whether setting, monitoring, or formally reviewing performance, the key is to set clear and achievable SMART objectives to set performance expectations.
As managers, it’s then on you to provide continuous, meaningful feedback to your team to guide them toward productivity success. But remember, feedback doesn’t need to wait for 1:1 meetings, with Grow offering the perfect platform to give feedback whenever and wherever inside the tools you already use.
