Performance management meets a deep psychological need for employees. Virtually everyone wants to feel confident in their abilities and make a meaningful contribution. Performance management can support both of those needs because it involves more than performance review, it is also a process whereby an employer discusses the employee’s skill and abilities, addresses gaps, and then ties the employees planned work to overall company strategy. An employee that has been equipped for a role in which they are well suited can contribute to the overall company strategy and feel fulfilled.

​

The achievement of organizational strategy can only occur if everyone is doing their part to support the strategy. That is why performance management must begin with strategic planning. The overall organizational objectives should cascade down through the organization and formulate the individual objectives that make up one's performance plan.

​

An illustration of this can be found in an important event in our nation’s history. In June of 1943, the allied leaders began to formulate a strategic plan to retake Western Europe, which culminated in the D-Day invasion. The plan included several key objectives, including the establishment of a foothold on the beaches of Normandy, securing the control of key roads and bridges behind enemy lines, and the taking of key cities in strategic locations. Underlying each of these major objectives were thousands of minor objectives that needed to be executed at all levels of the military. Every battalion, company, and individual had things that they needed to accomplish for the plan to succeed. The primary objectives cascaded down through the ranks and every soldier knew the part that they would play.

​

Effective performance management starts with the overall organizational objectives and those objectives cascade down to all levels of the organization. Each soldier understood their role and contribution on D Day. Each employee should know the part they will play. Just like the Normandy invasion, the plan will succeed as everyone is successful in doing their part.

​

These objectives must be defined by a particular set of criteria. This criterion is often represented by the acronym “SMART”.

​

S – Specific 

M – Measurable 

A – Achievable 

R – Relevant 

T – Time Based

 

Objectives that are defined by the criteria above will provide adequate clarity to the individual and the organization, allowing for clear judgement regarding the achievement of the objective. This clarity is important in leading employees that are not performing to expectations as well as those that are performing well. Clearly understood objectives that are part of the big picture will meet the employees’ need to contribute to something larger themselves and feel good about their ability and place within the team.

 

Managers must have a method to monitor progress so they can evaluate the employee’s performance and provide coaching and feedback. In an ideal situation this is continuous and organically occurs in normal regular communication. Managers can create continuous monitoring by incorporating it into a standard meeting schedule. Some may choose to make this part of a regular 1 on 1 meeting. The advantage of making this part of the 1 on 1 is that it will allow for regular coaching and two-way discussions. The extent to which objectives can be incorporated into team meetings will create one additional layer of visibility, collaboration, and accountability. Team members will share their progress with each other, facilitating collaboration and a healthy peer pressure to achieve individual objectives.

 

Finally, performance management should be tied to rewards and recognition, both financial and non-financial. The most meaningful recognition is the simplest, telling someone that they have done well, and that their contribution is meaningful and appreciated. Performance plans and periodic reviews create a regular feedback loop and avenue for compliments, however, good performers should hear of their contribution on a regular, not just an annual basis, so the compliments need to be part of normal conversations. Though one should not discount the importance of verbal affirmation and compliments, employees work because of what they receive in exchange for their efforts, not for compliments alone. Performance should be linked to where the employee falls within the succession plan and the pay scale. This will result in the best performers being considered for promotion and create for them compensation higher than the average performers. This adds to creating an objective sense and rational for pay and helping to retain the best performers while not overcompensating the average performers.

 

Solutions 

S. Miller Consulting can help design and implement performance plans that are linked to strategy, succession planning, and overall compensation planning to help organizations achieve a higher level of performance and accomplish their objectives.