Why do you need a performance management system?
Performance management is more than just an annual performance assessment. It is a continuous year-round process in which your executives and employees plan, monitor, and review career goals, work goals, and employee contributions for your organization. An effective performance management process enables your employees to receive the continuous coaching, feedback, and development they need to succeed in their role and achieve the results you need to grow your business.
We are often asked what the difference is between investing in a performance management system and simply performing performance reviews. But what is the difference and why should we take care of it? Performance appraisals are simply carried out a few times a year and are usually not considered motivating or useful to employees.
Performance management systems are used throughout the year to improve communication and documentation between employees and managers. In addition, these systems help to increase the likelihood that professional and personal development goals will be achieved by setting clear expectations at the outset and facilitating follow-up throughout the year.
If you ask your friends, family or colleagues about performance management, they will probably tell you how much they fear the process or how unnecessary it is. If so, why should your company invest in a performance management process?
An effective performance management process can help you unleash the full potential of your talents and make your small business a significant threat to your key competitors.
Here are 5 reasons why performance management is important and how it can improve your financial results:
A well-designed performance management process helps your employees understand how their work contributes to the overall success of your company’s strategy and objectives. This link allows your employees to know what is expected of them so they can focus on the most effective activities that add real value to your business.
Performance management ensures that your employees continue to develop their skills and abilities and have the knowledge and experience they need to ensure the excellence and success of your business now and in the future.
Continuous staff development allows your employees to take control of their own performance and professional development while contributing to your company’s overall success. The business result of dedicated employees is a higher level of employee satisfaction and retention, which means that your employees will be happier, more motivated, more difficult to work with, and less likely to leave your company for your competitors.
An effective performance management process encourages your leaders and employees to participate in regular and ongoing discussions about objectives and expectations, successes and challenges, and development needs. This gives your employees the feedback and recognition they need to improve and succeed.
When used correctly, performance management helps you increase employee productivity, improve employee engagement and reduce employee turnover, which ultimately reduces your costs and improves your bottom line.