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The Future of Performance Management

The Future of Performance Management



Performance is changing rapidly. In recent years, more and big name organizations scrapped traditional performance appraisals and restructured how their performance management processes. In the upcoming years, it’s expected that significant changes will continue to occur.

Companies are now starting to drop formal rankings and introduced on-going feedback facilities and informal check-in meetings. Let’s take a look at how performance management is evolving in the upcoming years.

  1. 360 feedback

Distinct from traditional developmental ,360 feedback around a competency framework we often see appraisal feedback being sought from a range of people.  We have gone from this requirement being rare to it being common.  The changing nature of the workplace, of teams, and of the manager-employee relationship has driven this requirement.  The common aim is to ensure a rounded and accurate picture of performance is gained. This is basically to get the updates

 2.1:1 Meetings

Employees lose sleep over them, managers plough their precious time into hefty piles of paperwork, and HR are left with a mountain of data to analyze. It’s the annual performance meeting. Now, companies are recognizing that once-a-year meetings are inefficient and insufficient.

Instead, companies are introducing “1:1 meetings”, regular, informal meetings or conversations between managers and individual employees. These allows managers to identify issues early on, support employees over time and encourage progress.

3. Social Media Impact

We’re already seeing social media taking on a role in the recruiting sector and it looks like it will also impact performance management.

In the future, social media interfaces will be part of the software design to make it as user-friendly as possible. Software will be designed to function in real-time to allow for constant feedback and regular updates between managers and co-workers.

4.Cloud based Performance Management Software and Apps

It has predicted that a shift to the cloud and increased use of software will be a big part of the future of performance management .It’s thought that cloud-based HR could improve employee engagement as well as cut down on admin time for HR teams. Many companies are already introducing performance management software that uses the cloud. Some companies are currently using a performance feedback app for managers and employees so that they can request feedback and provide comments from their devices.

Employees can request feedback from supervisors, colleagues, and internal “customers” through a real-time online app that lets people provide both positive and more critical comments about each other in a playful and engaging way.

For every kind of behaviour that employees seek or provide feedback about, the system—a structured, easy-to-use tool—prompts a list of questions that can be answered intuitively by moving a slider on the touch screen of a mobile device. Because the data are collected in real time, they can be more accurate than annual reviews, when colleagues and supervisors must strain to remember details about the people they evaluate.

 5.Key performance Areas and Indicators(KPA’s and KPI’s)

Over the next 100 years, performance-management systems evolved but did not change fundamentally. Managers are now focussing on the KPA’s  and KPI’s of their employees  as a balance scorecard for their performance .These KPA’s and KPI’s are then rated by their respective managers. The ratings are then calibrated against one another and, if necessary, adjusted by distribution guidelines that are typically bell curves .

6.Getting the right Data that matters

Good data are crucial to the new processes. Rather than relying on a once-a-year, inexact analysis of individuals, companies can get better information by using systems that collect data on the performance of people and teams. Continually crowd-sourcing performance data throughout the year yields even better insights.

As companies automate activities and add machine learning and artificial intelligence to the mix, the quality of the data will improve exponentially, and they will be collected much more efficiently.

7.Performance Development Tools

performance-development tools can also identify the top performers more accurately, which helps them and their managers to keep track of the company’s performance objectives even as they shift throughout the year. The tool facilitates requests for feedback and keeps a record of when it is received. It helps the HR managers to get both quantitative and qualitative information about their performance, so they can readjust rapidly throughout the year.

Crucially, the technology does not replace performance conversations between managers and employees. Instead, these conversations center around the observations of peers, managers, and the employees themselves about what did and didn’t help to deliver results.

In other words, tools can automate activities not just to free up time that managers and employees now spend inefficiently gathering information on performance but also transform what feedback is meant to achieve. The quality of the data improve, too.

 We can see some very clear trends emerging which are likely to form the basis of performance management for a large number of organisations in the upcoming years. These trends are:

  • Regular one-to-one performance conversations or 1:1 meetings, initiated by the employee.
  • Frequent, in-the-moment feedback from peers and managers, both positive and constructive.
  • Near-term objectives rather than annual objectives. Setting and reviewing objectives regularly rather than once a year.
  • Forward-looking performance reviews focusing more on development and coaching and less on assessment.
  • Performance processes supported by mobile-friendly, online performance management apps.


Core HR

Core HR is changing, moving from being about information storage to a more strategic process that syncs with business goals. Core HR in the traditional sense has always been about information gathering and storage. It’s the part that captures things like personnel information, payroll data, benefits, and so on.

Having a human capital management  system of some variety in place has always been essential to keep track of employee data, and it’s common that most companies at present have a core human capital management system that’s focused purely around areas such as payroll, compliance and admin.

But today we find ourselves in a landscape where the job market is employee-led, and core HR functions are increasingly combining with talent management.

Attracting and retaining talent is becoming a major challenge for companies, and company leaders now want to align people and systems with overall organisational goals.

Talent is the new core HR

Suddenly HR needs to be more strategic and ensure the right systems are in place to support employees, while still ensuring admin processes work seamlessly.

They also need to secure the durability of the company and its culture through strategic talent planning, moving from a focus on process and automation, to one of business impact and engagement.

Well, the most important thing is to keep talent at the heart – not just data processing functions. Likewise, and perhaps of equal importance, companies must understand their business priorities first and look to HR technology decisions second.

Changing core HR for the sake of it, or because everyone else is, is not the right move.

Given this, HR professionals are now looking at new software solutions to replace their disparate legacy of traditional  systems in order to unify employee data from a plethora of standalone applications, and ensure their new HR environments are systems of engagement instead of just systems of record.

Talent Management is a set of integrated organizational HR processes designed to attract, develop, motivate, and retain productive, engaged employees. The goal of talent management is to create a high-performance, sustainable organization that meets its strategic and operational goals and objectives.

Talent management differs from previous HR processes for hiring, training, and retaining employees—and indeed from HR itself—in several key ways:

1.Where hiring, training, and retention before were centralized in the HR department, with talent management many of these duties are federated to the front-line managers actually leading the employees in question.  In this way the whole organization is responsible for, and has a stake in these activities.

2.HR is more administrative-focused, dealing with pay, vacation days, benefits, and complaints, while talent management is almost singularly-focused on helping and improving the top talent in the organization.  Think professional development vs. tracking attendance.

3.Talent management is strategic, often manifesting as a company-wide long-term plan closely associated with overall business goals, while HR is more tactical, dealing with the day-to-day management of people.

A pain point for many is that you’ve got no budget to buy a system to manage employee data, so everything has always been done with manual systems like Microsoft Excel or paper even, and there’s no automated way to manage and understand what’s happening with employees.

Ultimately though, neglecting or resisting the change that puts talent at the core of HR is only going to impact the business negatively in the long run.

Unifying information and processes allows HR to focus on more important, strategic elements, such as ensuring talent pipelines and career progression.

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