Performance management is often a dreaded term amongst leaders. It has an association with time-consuming Human Resources (HR) processes and uncomfortable conversations with team members.
Following formal performance management processes as a leader can be time consuming, draining and often doesn’t feel productive.
But – it shouldn’t be that way, and when performance management is done well, you can see significant benefits in your team.
I’ll look at how to do that in this post.
So What Is Performance Management?
Performance Management is the name given to the process used to manage and monitor employee performance in the workplace.
Important Note: The best way to find out how Performance Management works in your organisation is to speak to your HR Department. You need to know the rules and processes for your specific situation.
It usually follows a series of steps including Goal Setting, Ongoing Feedback and Coaching, Review and Recognition.
Step 1: Goal Setting
First, we start with Goal Setting, which is about setting performance targets with your people.
This is usually done in the form of objectives which are able to be tracked and measured. You can learn more about setting good objectives in this post: Setting Team Goals: Tips for Thoughtful Leaders.
The first step sets the scene, because it gives people clear targets to aim for, and sets clear expectations.
Step 2: Coaching & Feedback
Coaching & Feedback is the next important step, and this is an ongoing process that occurs throughout the performance management cycle.
This is where you provide feedback to your people about how they are performing, and you might coach them to help them overcome any challenges they’re having along the way.
This step is essential, because it allows you to “course correct” if things are going off track.
What you don’t want is a surprise at the end of the performance cycle when someone has underperformed, without being told about it.
Learn More: Taking a Coaching Approach: Less Telling, More Asking.
Learn More: How to Accept Feedback in a Useful Way.
Step 3: Review
The review phase is where you formally review the person’s progress against their objectives.
This usually results in some sort of score out of 5, or a rating like “Meeting expectations” or “Exceeding expectations”.
Step 4: Recognition
This is the part where you provide recognition or reward, based on the performance review.
This might involve salary increases or other benefits, if the person has performed well.
Often promotions are tied to this part of the process as well.
Unfortunately, not many companies can afford to give out pay rises all the time. That’s why in this step, you might need to get creative with the potential rewards on offer.
Here are a few ideas of what you could offer to your people, even if you can’t give them a salary increase:
- Opportunities to attend conferences or other relevant industry events
- Opportunities to work on different projects that your employee finds interesting
- Providing relevant training or coaching in a specific area of interest for the employee
- Additional leave days; or
- Allocating time for the employee to work on an improvement or passion project that would help the team.
These are a few options to consider.
Just remember that if there are no rewards for doing well on a performance review, then your employees are likely to start considering it a fairly useless process.
Learn More: Risk & Reward: How to Provide Development Opportunities For Your Team.
Why Performance Management Has a Bad Reputation
At the start of this post, I alluded to the fact that performance management can be perceived as a negative thing.
In my experience, this happens for a few reasons.
Firstly, many companies struggle to provide rewards for good performance.
There are only so many promotions on offer, and you can’t just keep giving people more money (unless they contribute more). If there are few rewards, employees become cynical about the whole process. Their main focus will be to just do enough so that they don’t get punished.
Second, performance management often occurs on a yearly cycle.
So if you don’t get a reward this year, you need to wait a whole year for your next shot at it. That’s pretty demotivating.
Third, the goal setting process is often flawed.
When people are given objectives without consultation, or objectives that they have little control over, they fail to motivate.
Objectives that are not specific, measurable or relevant to the work of the employee are also problematic.
And lastly, the term “being performance managed” is often used to describe a situation where someone has performed poorly and is being punished through a formal HR process.
The term is rarely used in a positive light!
The 5 ‘C’s that I introduce below will attempt to improve on some of these issues.
What If the Person Performs Badly During the Performance Management Cycle?
If someone performs badly during the process, we can sometimes see people put on a “Performance Improvement Plan” or PIP.
In many organisations, performance management is seen as a way to “manage people out” of the business – in other words, to get rid of them.
The formal process of putting people on a PIP can last for many months of additional meetings and performance conversations, and the employee will need to meet specific objectives (documented within the PIP) within a certain time frame.
A major problem with the whole process is that once it becomes formalised, it has a strong negative stigma.
When people hear that someone is on a formal improvement plan (which is meant to be confidential, by the way), the initial instinct is to think that they are doing a bad job, they have behaved badly, or that their manager does not like them and wants to get rid of them.
Performance Management Should Be About Improvement
There are a few problems with the negative stigma surrounding performance management.
Unfortunately, people talk. Even though performance management is supposed to be a confidential HR matter, people seem to find out about it anyway.
This can ruin somebody’s reputation in their workplace.
Second, labelling someone as a poor performer can reduce their confidence. This can have the effect of creating a downward spiral (or self-fulfilling prophecy) where performance declines further due to the team member’s feelings of stress, insecurity and inadequacy.
At some point, I think that we have lost our way with performance management. At its core, it should be about improving performance, not about labelling them or getting them out the door.
From what I have observed over my career, once the formal performance management starts, the end is near.
Team members rarely recover, often choosing to leave or continuing to struggle with the additional burden of the arduous process, with their reputation and confidence in tatters.
Learn More: Setting Team Goals: Tips for Thoughtful Leaders.
2. The Context can make the difference
In general, I believe that team members are trying to do the right thing.
It’s very rare to find a team member who is actively coming to work every day to cause problems and make life miserable.
This is why it’s very important to understand the context behind performance problems in your team. It’s easy to label people as useless, stupid, lazy or rude. Often, people’s work and life circumstances contribute to poor performance.
Maybe Diego is going through a messy divorce at home. Perhaps Katie is having some ongoing health problems. It might be that Ling is being bullied at work by someone from another team.
If you can develop an understanding of the context, you can respond more appropriately. Jumping into formal performance management is not likely to help somebody who is already struggling.
Developing rapport and building relationships with your team members will help you to become aware of the issues they are facing.
Having an open and honest conversation can often be the starting point to fixing performance problems, without needing to get more formal about it.
A useful model to consider when thinking about what might be going on for your team members is the Iceberg Model of Human Behaviour. You can learn more about it at the link below.
Learn More: Want to Build Empathy? Use the Iceberg Model.
3. Consistency matters
The third aspect of improving performance is all about showing consistency.
Team members become very confused if you ask for something one day, and then change your mind the next. Or if you treat team members differently even though they are in similar roles.
Consistency is about reinforcing your expectations in a sustained manner. This takes effort, because you need to be sure that you’re paying attention to the messages you are sending.
One of the best ways to show consistency is to provide feedback and coach team members on an ongoing basis. This can be a great way to course-correct if they are going off track.
Consistency is important because without it, team members don’t know what the rules are. If something is important one day and ignored the next, it all becomes very confusing.
Consistency may also require cooperation
While it’s important to be consistent in your own behaviour and expectations, sometimes you also need help from others around you. Your people will be engaging with other teams and managers, and if they aren’t on the same page, consistency can be a problem.
For example, I’ve run into a situation in the past where I was coaching my team to provide a specific standard of reporting.
The only issue was, the reports also went to my manager and he didn’t have the same expectations.
This meant that the message was inconsistent. I wanted one thing and my manager wanted another. What I needed to do was to align more closely with my manager so we could both ask for the same thing.
After all, team members are going to listen closely to the person who is most senior… and in this case, it wasn’t me!
Be aware of any cooperation you might need from other people in your workplace, and get them on board with you early. Otherwise, they might just undermine the expectations you are working so hard to make clear.
Team members have every right to become frustrated in an environment where expectations are not applied consistently. And when you fail to be consistent, you only have yourself to blame if team members don’t do the things you’d like them to.
Are You a Consistent Leader, Or Keeping Your Team Guessing?
4. Courage is critical
If you have clarity and consistency, you need to have the guts to follow through. This is courage.
You need courage because reinforcing expectations and providing feedback about performance can be uncomfortable. Each time you offer advice or ask people to work differently, there is a degree of confrontation involved.
If things are really going off track, you might need to have a difficult conversation to work on the problem. Many managers will avoid confrontation rather than tackle the hard discussions. Unfortunately, while avoidance can feel more comfortable in the short-term, it will only lead to bigger problems down the road.
To find your courage, try the following:
- Think long-term: What will happen in the future if this performance issue is not resolved? Could it get even worse? And will other people get upset if it isn’t resolved?
- Look for inspiration: Ask yourself, “What would a great leader do?” Often you know the answer, it just requires courage to take action. There is nothing really stopping you from being one of these great leaders!
- Remember – people are watching you: You are a role model. People look to see how you will respond to this challenge. Are you going to let people down?
- Talk it through with a trusted colleague or mentor: Don’t go it alone. Test your thoughts, work on a plan and gain support to execute it.
5. We need Commitment to get results
Recently a Thoughtful Leader reader (Mark) told me a story about a situation in his government workplace where a manager in his new team was showing toxic behaviour towards team members. He didn’t want this in his department, so he started having some difficult conversations to address the situation.
Unfortunately, this manager didn’t respond, and made no change to his behaviour. This led to formal performance management, involving the HR department.
The process went on for many months, with no improvement in performance or behaviour. In the end, the manager showing the toxic behaviours resigned from the organisation.
Obviously the best result would have been for the manager to adjust his behaviour and become a productive member of the workplace. In this case, it didn’t happen and he decided to leave.
Mark told me that this quickly created a better environment for the remaining team members, improved Mark’s reputation and made a positive step towards improving the workplace culture.
Commitment is required to keep pushing forward
Imagine what would have happened if Mark had given up? The situation would have been allowed to continue, as it does in so many workplaces.
Many managers aren’t prepared to commit to the process of improving performance, instead choosing to turn a blind eye to the problem.
Mark showed the commitment to achieve the outcome he needed, which was to remove the toxic behaviour from his department. It wasn’t going to be easy, and he needed to be prepared to stay with it for the long haul.
Whether you’re coaching somebody to help them improve their skills, or managing a difficult behaviour issue in your team, you need commitment to make sure you keep pushing for the goal.
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Performance management should be all about improving performance, not just getting people out the door.
Ideally, the aim should be to help people improve and work well in their teams, rather than stigmatising those that aren’t performing well.
No matter what aspect of performance you’re trying to improve, the 5Cs of Clarity, Context, Consistency, Courage and Commitment will help you get the best out of your team!
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What is your view of performance management? Share your experience with me and all the other thoughtful leaders in the comments below!
Hey Ben,
Thanks, it is helpful
Great – glad it helps!
Ben
Hello Ben .
This is insightful and helpful.
Thanks Susan, glad it helps!
Ben