What are the benefits of Performance Management?

We will start off this article with a couple of quotes:
“Organisations that implement regular performance feedback have 15% lower turnover rates than those that don’t.”

“69% of employees say they would work harder if they felt their efforts were better recognized.”

“78% of employees said being recognized motivates them in their job.”

The quotes point to one key observation; a performance management system when implemented properly leads to many benefits namely reduces attrition, employees will work harder and it motivates employees.

In this article, we will highlight a simple yet effective performance management model to help companies implement in their work place. The aim is to encourage companies adopt performance management and help companies improve their business performance.

It does not mean that only a complex performance management system will work. In fact, we encourage a simple framework that captures the key components when you want to start a performance management system.


Figure 1: A simple framework to performance management

The key components:

1. Set goals; set simple & achievable goals with your employees. If you are a service staff in the food & beverage industry, this could mean as simple as serve every customers with a smile. It is easy to achieve and measurable.

2. Perform activities; provide clear procedure for employees to perform their role. A well communicated procedure sets the expectation and allows you to monitor the work. If you are in the hospitality industry, provide clear procedure and training before you deploy them to work.

3. Monitor performance; set up your process that allows you to monitor your employees’ activities either at each step or milestone that indicates a series of activities been performed. If you are in the logistics industry, you can set up key milestones to indicate a certain stage of work has been completed satisfactorily.

4. Review performance; review the work performed and provide immediate feedback. This feedback loop is important and should be carried out as often as possible. In any industry, constant feedback is critical to highlight shortcomings and reinforce sustained good behaviours.

5. Identify gaps & provide training; if you identify gaps, provide guidance or training to overcome shortcoming. Guidance or training does not have to be formal or conducted in a classroom. Going through the procedure over coffee during break time is training. The key is to get the message across!

We hope this simple framework will encourage you to start your journey in performance management. Start a small project to experience the benefits of performance management system and see how it can improve your business performance.

If you need help, we are just a call away.
Team Alchemy
October 2017

Reference:
http://blog.clearcompany.com/10-mind- blowing-statistics- on-performance- reviews-and-employee-engagement