July 25, 2021
Performance Management 22 July 2020
Performance Management: Concepts, Skills and Exercises
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Performance management is a well-known process recognized by almost all HR departments. However, the fact remains that some companies still don’t use this productivity booster properly and fail to achieve the desired results. Numerous studies prove our point, but we will highlight only a couple:

Performance management can have a negative effect if not handled the right way, so you should probably revise your strategy instead of starting it all over again. In this article, we will show you everything you need to know about performance management. Let’s check it out!

What Is Performance Management?

It’s actually important to begin with the basics and learn why we need performance reviews in the first place. By definition, performance management is a corporate management tool that helps managers to monitor and evaluate employees’ work. It is a very important part of your company's business planning and should be taken seriously. In other words, the ultimate objective of this HR mechanism is to create an ambiance in which every worker can achieve the highest level of personal productivity. Generally speaking, we recognize two performance management strategies:

  • Management by objectives: In this system, members of the team are aware of the overall goals and strategic objectives of the company.

  • Management by key results: This is a modern approach where HR managers put an emphasis on achievements and key performance indicators. 

While both strategies have their pros and cons, they tend to perform best when combined. How come? The reason is simple - workers have to know the higher goals of their organizations, but they also need to understand individual tasks and objectives.

Benefits of Performance Management Done Right

We have another interesting question to answer here: What are the practical advantages of creating a good performance management plan? There is no single and all-encompassing answer to give you, so let’s see the list of the biggest benefits:

  • Employees understand professional goals: When you craft a comprehensive performance strategy and present it to the staff, you actually help employees to figure out the expectations. This works on a more general company level and on an individual level as well.

  • Professional motivation: A well-executed performance management strategy can drastically improve employee productivity. The goal is not to criticize staff for not doing the right thing, but rather to highlight positive outcomes and instruct employees how to eliminate pain points. That way, every member of the team earns a brand new motivation boost.

  • Improve employee retention: We already mentioned that workers often consider leaving their current positions when faced with inadequate performance reviews. In such circumstances, it is fundamental to do the job properly and ensure a higher retention rate long-term.

  • Identify training opportunities: Performance reviews can give you a hint about who needs additional training. Jake Gardner, a writing service professional in charge of HR topics, says it’s a great way to strengthen the skills of your team members while eliminating unnecessary courses and reducing operational costs.

  • Firing decisions: This is never the ultimate goal of performance management, but sometimes you just have to deal with workers who are not able to change and evolve. In this case, performance reviews will help you to explain and justify your decision, backing it up with concrete data or statistics.

Alexis Haselberger a Productivity, Time Management, and Leadership Coach from Alexis Haselberger Coaching and Consulting shares her opinion on why performance management is so important. She states,

"As Peter Drucker so famously said, what gets measured gets managed. When we have our finger on the pulse of our own performance management, or that of our employees, we get continual, consistent improvement. If we don't manage performance, we may languish, spending time and effort on things that don't make sense, or believing that we have skills that we don't and not improving where we need to."

6 Ways to Approach Your Performance Management Plan

Now that you understand the basics of performance management, you should also learn how to approach it with all due attention and diligence. The process consists of several actions, so let’s check out each one separately: 

1. Understand the Importance of Performance Management

The most important advice is to really accept the impact performance management has on your organization. Don’t let it become a boring annual review without any practical value. After all, studies reveal that 76% of all employees want feedback at least monthly. It’s a critical HR component, so don’t hesitate to make the most of it.

2. Set the Right Objectives

The next tip is to set the right objectives and keep them aligned with the company’s mission. Your goals should be highly specific so as to match the duties of each worker individually. At the same time, they should be realistic and measurable, allowing you to track progress on the go.

3. Promote Autonomy

Don’t forget to keep your team members included in the goal-setting process. They are expected to deliver results, which is why you need to consult with them and determine whether your objectives are achievable or not.

Shari Smith, a business coach and founder of Shari-sells feels that the best way to approach your performance management plan is to identify your goals. She states,

" It would be easier for everyone if they are aware of the target goals. It will help them focus more on the goals stated making them more productive and effective."

She goes on saying you need to: 

"Complement and reward. No matter how big or small it is, giving a reward or a complement has a huge impact on the employees. It makes them strive harder and be motivated in achieving the goals for the company.

4. React Promptly

Another important advice is not to wait for the year to be over before reacting. On the contrary, you must react as soon as you notice something’s going wrong in your organization. Some companies hold multiple reviews every year and organize one-on-one meetings to solve problems instantly.

Jeremy Harrison Founder, Head Of Content Strategy at Hustle Life

"Performance management should not only be done once a year but regularly throughout the year. Whether formal or informal, this should be conducted to help employees improve. Identifying key strengths and weaknesses can help identify the correct training you need to equip your employees of all the skills they require. It also boosts morale, helps identify the right people for promotion, and aligns everyone with continuous reminders and feedback"

5. Make It a Fully Transparent Procedure

Performance management is a delicate business that can often cause emotional reactions. For this reason, you should make it a fully transparent procedure and explain every single aspect of your strategy – from KPI analytics and problem-solving to compensations and career planning.

6. Don’t Be Afraid to Change the Plan

Performance management is not supposed to be a fixed system, but rather a flexible process that embraces changes whenever needed. Therefore, you should not be afraid to change the plan when you notice it can be better.

Best Performance Management Tools

The year is 2019 and you certainly don’t have to deal with performance management using the ancient pen-and-paper technique. There are all sorts of digital platforms to help you out here and we will present you the best solutions currently available.

  • ProSky

ProSky is an all-in-one talent software that handles employee performance management by using Career Pathways. Everything from employee hiring, onboarding, evaluations, and in-house mentorship can be taken care of using tools built into the platform allowing companies and employees to grow together.

  • Workday

Workday is an all-encompassing performance management tool that covers everything from business planning to human capital. The platform is suitable for all types of organizations, but the sheer complexity of features makes it perfect for medium and large enterprises. 

  • KissFlow

KissFlow is a professional performance management tool with a wide range of simple and intuitive operations. The platform is designed so as to visualize workflows, boost collaboration, and maximize employee productivity. As such, it is ideal for smaller and medium-sized teams.


Performance management has the power to boost employee productivity, but it can also have a counter effect and slow down your team in the long run. For this reason, it is essential to design an adequate strategy and start creating performance reviews that can really make a positive impact on your team.

In this post, we tried to help you by discussing the basic elements, concepts, and skills related to performance management. This is an excellent starting point for all HR units, so do your best to remember our suggestions and use them in your everyday work – they could make your organization much more productive and efficient very soon.

Justin Osborne is a content marketer and writer at Best Essay and custom paper writing service, he loves to share his thoughts and opinions about education, writing and blogging with other people on different blogs and forums.