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Employees go to work every day with the intention of doing a good job. However, this intended outcome is often impacted by the process by which they are managed.
Business growth is most often achieved by strategy. This strategy is defined within an organization’s strategic planning process.
A business strategy includes the development of goals that will facilitate the process of achieving the strategic plan.
Businesses create SMART goals to achieve those objectives.
For instance, a restaurant may have a strategic plan that includes expanding its operation to a second location.
This would require a plan and specific goals to achieve that objective. A goal for this objective might be to identify a new site location, recruit a managing chef, or purchase kitchen equipment.
However, goals and objectives are only as effective as the people who have responsibility for completing them. In other words, a strategic plan may look great on paper but until someone completes the steps to get it done, it is merely another business document.
The Importance of Managing Employee Performance
Managing employee performance is how work gets done and goals are accomplished.
Create a structured process for managing employee performance to ensure that goals are achieved.
You might say, ‘but I’m too busy…’
We are all busy, and sometimes do not invest the time to develop a performance management structure, process, and training.
This lack of structure and training can result in a bad experience for all involved.
For the employees who may be given inconsistent and biased feedback, and for the managers who are forced to perform a duty that they are not trained or prepared to do.
Performance Management System
A performance management system is a framework used to manage employee performance.
This system includes a process to manage performance as part of the business strategy and includes an emphasis on accountability to get the job done.
And, as with most areas of business, performance management is only as good as senior management’s commitment to it. If top management doesn’t value the system, lower-level managers won’t either.
Managing employees requires a systematic approach to tracking, documenting, and communicating performance goals and expectations.
This loop is closed by providing employees feedback on how well they met expectations.
The ability for an organization to do this well has a direct impact on how employees perceive the process – and ultimately the organization.
Training is Crucial
Training is important for both managers and employees.
Managers need to have a good understanding of the process of managing performance.
This includes a manager’s understanding of the expectations for their part in documenting and communicating to employees on how well they are performing and achieving employee goals.
Training for employees is also important so that employees understand their responsibility in performing job duties and how they will be assessed during the performance appraisal process.
For instance, employees need to understand the tool that is used to assess them and the expectations for meeting the criteria on the performance appraisal form.
The system fails when managers don’t have a good understanding of the process, and the employees receive inconsistent messages about their performance.
3 Reasons You Need to Manage Employee Performance
1. Employee Confusion
Employees need constant feedback on how well they are performing job expectations.
Employees can be confused when they don’t receive consistent messages about how well they are performing.
For instance, managers need to have ongoing conversations with employees to reinforce expectations and remove barriers to performance.
Managers should communicate performance expectations and collect data throughout the year by documenting performance behaviors.
This important step removes all rater biases and keeps the communication open and objective.
2. Low Employee Morale
Employee morale can be affected when employees don’t understand how their performance impacts compensation.
For instance, an employee may become discouraged if they feel like they are working hard but do not receive the compensation they think they deserve.
When employees become discouraged it impacts morale and can have an impact on the culture of the organization. Discouraged employees may go through the motions but don’t enjoy their job.
Encouraged and happy employees result in a positive work environment.
3. Low Productivity
Employee morale has a direct impact on productivity.
When employees feel hopeless and experience low morale, productivity will naturally decline.
This is concerning particularly when management doesn’t monitor performance and may not even realize the scope and business impact of discouraged and unproductive employees.
This is particularly important when it comes to cost control and overseeing budgetary expenses. Salary expenses typically account for the highest percentage of budget dollars.
Paying salaries for unproductive workers is a sad waste of resources.
It Is Not Always Easy Managing Employees
Managing others is a time-consuming, repetitive, and often thankless job.
Managers who are allowed to function within the scope of a structured performance management system can see the effects of employee development and growth. Which happens to be one of the greatest rewards of managing others!
Does your organization have a structured process to manage performance?