Table of Contents

5 Strategies to design an Effective Performance Management System

Performance management software-Datalligence
Table of Contents

“Employees who believe that management is concerned about them as a whole person – not just an employee – are more productive, more satisfied, more fulfilled. Satisfied employees mean satisfied customers, which leads to profitability.” – Anne M. Mulcahy (former CEO of Xerox)

Performance management is not a new idea. It has been present since the existence of corporate organizations. Successful companies have implemented effective strategies to improve and monitor their workforce performance. Regardless of your designation (manager or not), you may have to enforce management in your tenure, as it is an integral part of any organization.

That being said, the word “Management” evokes some negative connotations. Oftentimes (sadly), people wrongly relate management as a system that is in search of making employees overwork. Not only is this not true, but it is the contrary. Expedient measures taken to improve productivity by various organizations can also be held responsible for this ill fame. Performance Management plans should actually be on the lookout for the best interest of the employees, like their training, career development, and positive reinforcement, etc. Such measures are critical in the furtherance of an organization’s employees, and organizations are nothing more than the collective effort and culture of their employees. So it is wise to invest in their needs. Even emotional requirements for your employees should be taken into consideration aside from the physical and mental ones to perform exceptionally in the workplace.

Now take a look at five of the best strategy for your organization to design an effective performance management system for your employees:

performance management tools

1. Bidirectional communication

Communication is a bidirectional network, so should be the management’s relationship with the employees. Pay attention to employees’ opinions and how they prefer things to be in your organization. If employees are able to work and communicate in a way that is most easy for them, then efficiency will translate well into productivity. Communication is a long-term investment that managers can work towards that will yield glorious results. Effective performance management systems are the ones that incorporate good manager-employee communication strategies.

2. Custom Learning plan

All employees are not the same. While they are all critical in their own way, they don’t function the same. This is why the same training program for all employees is just not practical. So it is ideal to understand each of the employees and their learning styles first and then create a training plan. Every employee requires a different dose of motivation. This is because two employees don’t have the same strength and weaknesses or the same ideas, or even the same perception. They are like diamonds carved from different stones. Evaluating your employees’ knowledge and skill frequently will let you understand them better, and with that collated knowledge, you can customize your training plan accordingly.

3. Continuous Performance Management

Routine performance assessment or discussion may make you strictly result-oriented, which will affect your relationship with your employees. That is why a reward system is vital at the end of the performance evaluation for employee encouragement. Performance appraisal is the feedback stage, where employees are rewarded with bonuses, promotions, etc., for their effective work in the given assessment period. It gives the ruling based on employee competency and ability after the review. Reviews such as the 360-degree Performance Review or OKR based performance review take feedback for employee’s performance from stakeholders, peers, subordinates, and sometimes even from the clients. These frameworks provide unbiased and well-rounded data to review the employee’s performance.

4. Consistency In Key

If you hear any success story, there will be one key element in all of them more so than hard work, which is consistency. Rewarding employees for their high performance should not be a one-time thing. It should be followed upon. Employees should be rewarded for their performance on a consistent basis, and the same can be said for discouraging unacceptable behavior. Every organization should have to have standards and principles which should be acted on consistently. Also, it is important to recognize that the manager’s behavior, work ethic, and quality of work forms an example for the employees. Therefore it should be maintained consistently to the highest of standards. Communication, Feedback and recognition should be constant and ongoing. These conversation promotes employee morale and promotes consistency.

5. Career planning guidance

An effective performance management system does not just stop in its employee’s development within the boundaries of the project at hand. It strives to advance its employees up the corporate ladder and support their career development. Through training and opportunities, the employees should be pushed ahead in a performance management plan.


All the five strategies above, in their efficient implementation, will provide better sustainable results for any organization by enabling them to have an effective performance management system. Any strong performance-based workplace is more capable of creating better business performance. If you are looking for the best performance appraisal software, try the Datalligence software system. Try the trial version and get to know the new compelling features.

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