By Chloé Gesret, Top Employers Institute
By Chloé Gesret, Top Employers Institute

Performance Management: it’s time for a better conversation

Organisations have known for some time that employee engagement and business performance are closely and positively linked. To know this is one thing, to harness it is quite another. Research among our 1,500 certified Top Employers organisations globally shows how important performance management conversations have become in this respect.

The table below shows that there is a clear recognition of the close relationship between the two when our Top Employers are asked what it is that they want from performance management.

The case for ongoing performance management, rather than annual performance reviews, is already much discussed and well established. Less well known, however, is the changing nature and tone of the performance management conversation itself.

There is a clear change of tone coming into performance management conversations in order to get the best outcome for employers and employees alike. Recent research published in the Harvard Business Review highlights the rapid growth of both awareness and action around workplace wellness - and its positive impact on performance. While there had previously been an expectation that wellness programmes reduce absenteeism within a year or two, the research concludes that they are not, on their own, proving as effective as had first been first hoped.

Instead, employers are making the link between well-being and performance more explicit. They are shifting their focus to organisation-level approaches for reducing stress and improving well-being, as a way of improving both employee engagement and business performance. It follows, therefore, that well-being is now becoming a regular part of the performance management conversation. For example, one of our Top Employers discusses well-being during performance reviews and encourages employees to speak freely about how they are feeling. Questions asked of employees include: “What are your expectations towards your manager?”; “What are your expectations towards the company?” And “What about your work life balance?”

Our research shows other important and related changes taking place in the way performance management are being conducted. Over 4 in 5 (84%) of our Top Employers consistently recognise the contribution of employees as part on an ongoing formally defined part of the performance management cycle. Recognition is crucial – and needs to be offered consistently throughout the organisation by well-trained and aware line managers. And nearly three-quarters (74%) of Top Employers now consistently offer extensive behavioural training to ensure that employees understand, practice and become comfortable with their role in the performance management process. 

This is all part of an emerging performance management “bargain” between employer and employee – one in which the latter takes on increased responsibility for their own development. Another of our Top Employers uses performance management conversations to help employees to shape their personal development plan with their manager, based on the 70/20/10 model of learning of doing /learning from others /classroom learning.

Behaviour within teams is also becoming increasingly important in performance management conversations. In over seven out of ten of our Top Employers (71%), employees can expect to have goals related to team performance and/or network contribution. Engagement is about how connected employees feel to those they work with, as well as with the organisation, and a clear sense that their contribution is valued by these colleagues. And for employers, leveraging the power of teams, when so many teams coalesce together these days from differing disciplines and locations onto specific projects, is becoming increasingly important. 

A commitment by business to changing the nature and scope of performance management conversations is essential – and good for leaders too. When handled well, leaders can use performance management conversations to introduce a more modern, enabling style of leadership, where he or she impact and support by asking the right questions in the right subject areas and at the appropriate time of the year.

The change in tone in performance management conversations to those that include more insight into well-being, recognition and expectations are just some of the changes we have seen emerging. To educate and encourage leaders and managers to evolve the way they talk about performance to reflect these changes is time well spent for them, their teams – and their organisation.