Article: The new age 'Performance Management System'

Performance management systems

The new age 'Performance Management System'

Your performance management strategy must augment the behaviors that are needed for your business to succeed.
The new age 'Performance Management System'

When it comes to driving a high-performance culture, the biggest question you’re posed with is that what should be your performance management strategy? My answer to that would be step back and look at your business strategy first. Does your business strategy require self-starters and people who can co-own your growth journey or does your business strategy require people who can diligently follow the norms and ensure that your organization’s machinery keeps moving uninterrupted?

Your performance management strategy must augment the behaviours that are needed for your business to succeed. This comes from the vision & mission of your organization and the values it needs its people to emanate. Your organization’s personality and brand promise govern what behaviours you wish to reward and what you don’t; whom you hire and whom you don’t.

What should your performance strategy look like

Whatever be the need of the organization, the answer to ‘what should be your performance strategy’ must start with defining ‘what is your hiring strategy’. If you are hiring people with the right competencies and those who are aligned to your business vision, then the task to keep them motivated becomes a lot easier.

Hiring people who find joy in what they do and are passionate about your company’s purpose may be intrinsically motivated and require less external impetus. Intrinsic motivation allows for greater efficiency, higher proclivity to learn & excel and exhibiting superior tenacity. Having said so, it wouldn’t be wise to outright ignore the value extrinsic motivators can bring to the forefront while creating a compelling value proposition for people to over perform.

Relooking at your performance management strategy in today’s context is also critical as there is a high level of ambiguity in the external environment and leaders are challenged with keeping their remote workforce engaged & productive.

Components of a robust performance management program

So, in the new world of work with millennials forming a majority of your workforce and external environment changing ever so rapidly, here are a few things that one must do to create a robust performance management program:

  • Create a meaningful connection between a person’s job and the organization’s vision. If people do not see what their job is translating into, they may not find their job to be meaningful. It is mission critical for people to know the purpose of their job, its linkage to the overall business strategy, and more so, the negative impact of a job not-well-done. Communication is the most powerful tool to be leveraged in keeping people motivated.

Well cascaded objectives that clarify & align with the purpose of the organization, clear demarcation of responsibilities and celebrating periodic milestone achievements go a long way in eliciting the desired performance levels by your people.

  • Clearly defined internal growth path and disproportionate reward for exemplary work. Vast amount of learning & accelerated growth are two critical aspects most people look for in a job today. Recognizing people for their potential, in addition to their performance, is essential. This doesn’t mean you don’t allow people to prove their mettle before placing that big responsibility in their shoulders, but what this means is that you keep a keen eye on available talent within the organization and keep nurturing them to take up key roles in successive years.
  • Create Ownership. Empower people. A lot of gen Z and millennials today seek more responsibility and freedom to perform at work. Allowing people to take responsibility for their tasks empowers them and motivates them to excel. For example, encouraging people to set their own targets & devising their own strategy to fulfil them is a significant step towards offering more control over their tasks. This belief stems from the ‘Self-Determination’ theory by Edward Deci and Richard Ryan who argue that individuals experiencing autonomy are likely to be self-determined and foster high levels of engagement and motivation. 
  • Create new goal posts and feedforward. Gone are the days when it was okay to only review performance once a year. Today organizations believe in setting both long term as well as short term objectives.

Keeping fluid objectives allows you to course correct and realign your strategy based on outcomes of the short-term objectives you set for yourself.

In such a scenario, doing frequent performance discussions which are future focussed are much better than a one-time backward-looking evaluation. 

  • Reward & recognize generously. One of the very critical pieces of the performance management system is the reward for good work. Reward, not in terms of only monetary gains alone, but reward also in terms of appreciation. Creating a culture of recognition is important for business leaders as it is a way of letting their people know that they are valued. Several researchers have emphasized the value of employee recognition programs in creating higher employee engagement and ultimately delivering superlative performance. But knowing what the needs of your people are, and constantly evolving your once-created recognition program is essential. Each employee archetype may have a different need for recognition - some may need money, some power, some visibility, and some may just need gratitude. Offer people what they need and do it with heart.

In a nutshell, your performance management strategy must factor who you want to hire, what values and behaviours you want them to exhibit and what is the external environment like. Answers to these questions will lay a good foundation to building a relevant and sound performance management program.

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Topics: Performance management systems, #GuestArticle, #RethinkPerformanceandRewards

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