In spite of having a great process and procedures in an organisation, everything narrows down to people. It is important to have effective performance management and an employee engagement system to create a high-performance culture. Many organisations try innovating their performance management process continuously but there is never a right solution.
Having a dynamic workforce and also millennials and Gen Z in the workforce it is a great challenge for an organisation to create a program that fits all and one-size-fits-all will not work anymore
Successful organizations have great performance management programs. They have given away the Annual Performance Management and transformed it into a Continuous Performance Management program.
Performance management is a process where an organization measures the effectiveness of an employee and understands their contributions to the organization. This also gives an opportunity to create training plans and bridge the gap between what is expected Vs what is actual. performance of an employee is rated against rating parameters set by an organization, and they are rewarded with salary increases and benefits.
Why is performance management important?
Performance management is highly important for any organization to understand where the resources are utilized and how effectively they are utilized. For an employee, this is the platform where they can share their reviews and also feedback on their role, responsibilities, and also about the at-work culture. Feedback is given and received during a performance review.
Performance review when done continuously becomes a feedback mechanism by itself, that helps teams to monitor and track progress and the feedback given continuously increases employee engagement and which results in an increase in productivity. Gone of those days when the performance management system was done annually, today it has changed to a continuous system.
When the feedbacks are multidirectional or both upward and downward it creates a sense of trust and leaves a safety net around the team to achieve the ambitious goals.
Since the performance management outcome is compensation and benefits it affects employee morale and motivation when not done right it also creates a negative impact there is ambiguity in the process. It is important to have a process that satisfies and motivates most of your employees.