Automating performance management processes makes it easier for companies to alignemployees’ individual goals with corporate objectives. It makes measuring performance andassessment simpler and more consistent, and allows companies to see clearly their best andpoorest performers. Such insights are invaluable in a climate where headcount reduction issadly a necessity for many companies, which equally want to retain their talent.When considering the merits of automating performance management though, it’s reallyimportant to convince senior executives to look beyond the bottom line and appreciate theother, in some cases less tangible, benefits too. By embedding an effective performancemanagement process, companies are demonstrating a willingness to invest in employees.This will impact directly on retention of high performers, who are keen to plan and developtheir career.Also, we’ve found many instances where, by going through the automation process, companieshave taken the opportunity to reassess existing practices. This results in standardisation andconsistency of performance management processes, is impossible to achieve with an offlineprocess as too much is open to interpretation by line managers in different business units.
Time to reappraise the appraisal
A large proportion of employees – approximately 40% – remains dissatisfied with theirappraisal process.2In addition, it seems that line managers too share concerns regarding performancemanagement processes. Research shows that 61% of managers don’t believe existingappraisal processes are driving greater performance.3 These figures should worry businessleaders as ineffective appraisals will lead to a dip in employee satisfaction, which has a directcorrelation with business performance.Companies must get the basics right. Crucial to engaging employees is ensuring they haveclear goals and objectives. Yet 30% of private sector employees don’t know what theircompany’s objectives are. Individual and corporate objectives should be aligned – if anemployee understands what is expected of them and how this fits in with company objectives,they are more likely to be engaged and motivated to perform. Furthermore, alignment of objectives is also crucial in ensuring your business strategy is ultimately successful.
How do managers and their subordinates benefit?
An automated system can make a huge difference in simplifying performance managementby making it more transparent, giving all involved greater confidence in the process.Employees are clearer on what’s expected of them and can see how their objectives supportorganisational goals, resulting in increased engagement.With less time spent on functional processes, line managers are free to focus on careerplanning, coaching and development for direct reports, making it easier to identify, nurtureand develop talent. A cautionary note here though – it’s important that an online system isn’tseen by employees or managers as a barrier to face-to-face discussion. It should aid andinform, rather than replace, performance-related conversations.
1. How automating performancemanagement helps people processes
A huge number of employeesare dissatisfied with performanceappraisals. Our research shows this is due to thelack of clarity andinvolvement insetting goals.
- Performance ManagementReview: An analysis of the ETSEmployee Survey. ETS plc, 2009.