Performance Management

Performance Management consists of a system or process whereby:

1. Work is planned and expectations are set
2. Work performance is monitored
3. Staff ability to perform is developed and enhanced
4. Performance is rated or measured and the ratings summarized
5. Top performance is rewarded

It is so rare to have decent performance management in companies nowadays, that when managers go out of their way to provide honest feedback and actually improve the performance of their workers they should be handsomely rewarded and recognized.

This post is a collection of best practices and topics on Performance Management that I learned over the years (and lost the references). Subsequent posts in this subject will be more clearly written and better organized but, even as it is, I hope that this will be useful to me and to some of my readers.

Pre-conditions

Most of the performance management process happens during meetings. But before we delve further into the meeting per se, I should stress that in the beginning of the first meeting (or even before it starts) the employee should clarify/review his role:

• What is the job description (as defined by your manager) and is there a difference between it and what you actually do?
• What are your manager’s expectations for your career?
• Does your manager fully understand how much you do now? Has your job changed at all in the last 12 months? Have you taken on new duties, been delegated a new task by someone else?

If there are differences between what the employee thinks it should be doing and what the manager expects, the appraisal will not be an accurate reflection of the individual. The appraisee should clarify expectations as soon as possible. Because of that, the first performance management meeting should be made a few days/weeks after the employee arrives.

Performance Management is continuous

Overseeing performance and providing feedback is not an isolated event, focused in an annual performance review. It is an ongoing process that takes place throughout the year. The Performance Management process is a cycle, with discussions varying year-to-year, or even month-to-month based on changing objectives.

The cycle includes Planning, Checking-In, and Review.

• To begin the planning process, you and your employee review overall expectations, which includes collaborating on the development of performance objectives. Individual development goals are also updated. You then develop a performance plan that directs the employee’s efforts toward achieving specific results to support organizational excellence and employee success.
• Goals and objectives are discussed throughout the year, during check-in meetings. This provides a framework to ensure employees achieve results through coaching and mutual feedback.
• At the end of the performance period, you review the employee’s performance against expected objectives, as well as the means used and behaviors demonstrated in achieving those objectives. Together, you establish new objectives for the next performance period. As such, after the first meeting, the Review and Planning always happens simultaneously.

These meetings should focus on the next steps, in the future, what the employee should do. They should not be a moment focused on capturing and giving feedback about last year. They can, and should, be a discussion about what happened, but only as long as it helps to frame and give context to the necessary changes in job and to talk about the skill requirements that will be used to implement the business strategy.

Objective Setting

Every employee should have a set of objectives and performance expectations aligned with the business goals, his job and career preferences. The main purpose of the performance management meeting is the discussion of these goals, to give the employee clarity about what is expected of them at work, what is the company strategy and how they fit into the big picture.

The plan can focus on skills aimed at job mastery or combine job mastery with professional development skills:

• Job mastery skills are those that are necessary to successfully perform one’s job.
• Professional development skills are the skills and knowledge that go beyond the scope of the employee’s job description, although they may indirectly improve job performance.

In the process, staff members also turn more generic goals into personal developmental goals that will increase their ability to contribute to the success of the organization. The accomplishment of these goals should provide a foundation for their career success whether in your organization or elsewhere, so they ought to be motivated and excited about achieving them.

Frequent one-on-one

Later during the year, regular feedback meetings should be scheduled, ideally once a month. During these one-to-ones you would be expected to check in the progress to attain the goals, expectations and objectives previously set. But in addition to that, the manager should be giving feedback, using coaching skills, and checking that the employee is totally understood and has all the necessary support and resources to accomplish his work. Moreover, both parties should make sure that the goals remains SMART (Specific, Measurable, Attainable, Relevant and Time-bounded). Notes and development actions should be written, communicated and used as evidence to upper management that the meetings were being regularly held.

Verifiable Expectations

Performance expectations should be verifiable. Early in the performance management cycle, the manager, with input from the employee, should identify how and where evidence about the employee’s performance will be gathered. Measurable (quantitative) expectations are the easiest ones to verify. Frequently, however, expectations cannot be put into measurable terms easily or accurately. If that’s the case, consider developing qualitative expectations, which can generally be made verifiable by spelling out the criteria to be fulfilled, behaviors to be demonstrated, and/or target dates to be met.

There are many ways to verify performance; some of the most common are:

• Specific work products (tangible evidence that can be reviewed without the employee being present)
• Reports and records, such as bug counts, code reviews, financial records, etc.
• Checklists that can be completed by a client or supervisor listing specific, observable criteria that need to be met in order for an expectation to be considered complete. Criteria usually require a “yes” or “no” answer, such as: “complete the [x] certification process by [x] date.”
• Direct observation
• Rating scales that define, as precisely as possible, behaviors at different levels of performance (behaviorally anchored rating scales).
• Commendations or constructive or critical comments received about the employee’s work

But what happens to the ‘Appraisal’?

In many companies, the end of year appraisal is where the employee finally discovers what the boss expected. It’s usually a discussion on whether the employee should be promoted, what are his strengths and improvement opportunities. But using the practices above, because of the previous planning and constant feedback, the (in)famous appraisal happens without surprises for both parties. The employee already know what is expected of him and it should be fairly easy to objectively verify if all goals have been achieved. As such, in 15 minutes both parties can “fill out the forms”. Or, in some companies, they can abolish the yearly appraisal altogether.