For any organisation to succeed, it needs the ability to accurately assess how it is doing. In particular, the leaders in type of business need to look at how their employees are performing, and then use this information to make improvements to the way the organisation is run. There are many ways of doing this, some more effective than others.
When handled effectively, performance management can be beneficial both for businesses and their employees. In this article, we will look at exactly why we need performance management, how we can best measure performance and how often we should be measuring it. It will also look at the impact of performance management and provide tips for successfully managing it in your organisation.
Why do we need to measure performance?
When thinking about performance management, it is absolutely key that we know what we are trying to achieve. This is something you will have to decide for yourself because it will depend on your unique organisational challenges and goals.
Some questions you might want to ask yourself are:
- What does success look like for our organisation?
- What do we do well?
- What do we need to do better at?
- Where are our competitors beating us?
- What do our customers want from us?
By thinking about some of these key issues, you can start to work out what you need to be achieving as an organisation. You can then think about what each member of your team needs to achieve in order to drive your success. This can help you produce quantifiable, measurable actions for each employee and team, allowing you to make meaningful observations about individual and overall performance.
How can we measure performance?
Creating meaningful, measurable metrics for performance can be a challenge. Should you measure the amount of time employees spend on key tasks? The volume of work they produce? The amount of money they generate versus what they cost? Or do you need to find some other way of determining the value they add to your business? Again, deciding what are meaningful metrics to measure will depend on your organisation and goals.
You will also need to think about how you will measure them. Customer Relationship Management (CRM) software is often a key part of performance measuring for many organisations. This allows you to keep a record of all interactions with a customer and tasks related to their account, allowing you to see what has been done and when, how much time has been spent on a project, how much budget has been spent and other key performance data.
Project management tools such as Trello are also increasingly important for many businesses, allowing teams to quickly manage and collaborate on projects, so managers can easily keep track of what is being done and when.
How often should we be measuring performance?
In many traditional businesses, it is common to measure and feedback on employee performance as little as once or twice a year, in annual or six-monthly staff appraisals. You need to ask yourself, however, if this is appropriate for your business. Addressing employees’ performance so infrequently means problems can potentially build up over time without any remedying action being taken, while staff will also not have the opportunity to air their own concerns, which could have a negative effect on their and your company’s continuing performance.
Many modern organisations now look to incorporate frequent feedback mechanisms, so that performance management becomes a continuous process. This means small changes can be made regularly to improve staff performance, rather than big disruptive and expensive adjustments on a less frequent basis. This can be easier for staff to adjust to, as well as meaning you see faster improvements in performance.
The impact of accurately measuring performance
If you can accurately measure performance in your organisation and act on that information to improve performance over time, it can make your business much stronger and more adaptable. Good performance management allows you to increase the effectiveness of your workforce, deliver a better service to your clients and ultimately increase the value of your business. It also allows you to react to change better, allowing you to refocus your workforce and organisation where necessary to meet new opportunities and challenges.
Ultimately, good performance measuring and management is essential to keep your business healthy.
The future of performance management
New performance management software and techniques are being developed all the time, but the general trend at the moment is away from micromanaging employees and more towards giving them the tools to manage their own performance. This generally involves making it clear what is expected from employees, then using CRMs, project management software and other technology to manage their own performance against agreed metrics.
Managers can then monitor these metrics and make small interventions and course corrections as required, rather than having a more formal and infrequent system of staff appraisals. Many companies are also realising the value of tying employee development into performance management, helping employees to develop the skills needed to perform better through additional training and self-learning.
This approach makes performance management a two-way process, rather than something prescriptive handed down to employees from above. This tends to make performance management more engaging for employees, leading to better results for them and the organisation as a whole.
Get performance management consultancy that adds value to your business
Infinity Loop Consulting’s expert business consultants specialise in effective performance management. We will look at the needs of your organisation and help you to develop effective strategies and feedback mechanisms to improve employee performance across your organisation. This includes highly effective and efficient non-confrontational ways to measure employee success.
We can help you put in place performance management processes that work right through from the hiring process to ongoing performance evaluations and assessments. Ultimately, we believe that making your employees happy, effective, and productive is not a one-way process – it’s a conversation – and we want to help you find ways to start having that conversation and making it count.
All of our consultants are experienced entrepreneurs and business leaders, meaning the advice we give you is based on what we know works in the real world. We aren’t simply regurgitating dry business theories we learned from a textbook, instead we are giving you practical, actionable advice that we know will bring you real, measurable value.
To find out more about improving performance management in your organisation, call us today on 0203 893 0492 or use our contact form to send us an email.