5 Ways Performance Management is Revolutionizing HRM

Chirantan Patel

Chirantan Patel

Senior editor

Parul Saxena

Chief editor

Last updated: February 12, 2021


Possible Work : No. 1 In Performance Management Software

Importance of Performance Management Software

Performance management is an ongoing process in the most successful organizations. A continuous or frequent review system is time-consuming for both the managers and the HR team. However, this is essential to review the employee’s progress or negative performance and not keeping a regular tab has a direct effect on the productivity. To solve these issues, performance management tools play an integral role in revolutionizing the human resource in companies of all sizes.

Often manual performance evaluation leads to errors as it’s difficult for the HR to remember the entire year’s data. Performance management is critical in evaluating the data and coming up with quick error-free results that are satisfactory to both the employee and the management team.

Role of a Performance Management in HR

As a tool to initiate and communicate feedback between the employee and the management, the role of a performance management system include:

  • Gives the employees’ clear idea about the goals they are expected to accomplish. This makes the employee understand the contributions they are to make to the organization.
  • The managers can share quick inputs with the team members by continuous feedback without having to wait for monthly/yearly appraisals.

Let’s have a glance at  the following ways

5 Ways Performance Management is Revolutionizing HR

1. Synchronizing SMART Objectives with the Organization’s Goals

The Smart Objectives include – Setting goals that are basically Specific, are Measurable, Achievable, Relevant and also Time-bound. Often in an organization the superiors set goals which are then handed over to team leaders and then reach the employees. This process is time-consuming and leaves a window for errors.

With performance management, the HR can directly assign organizational goals and objectives to the concerned employees or have the employees set their goals. Greater transparency and more efficient communication are an added benefit.

By integrating performance management in HR, the employees are judged on the basis of goals, rather than the tasks listed in job descriptions. They can work in a manner that suits their strengths leading to a shift in focus from tasks to long term goals.

Leading companies such as Adobe and General Electric have adopted performance management as a part of their HR to focus on immediate goals instead of annual objectives.

2. Frequent 1:1 meetings and check-ins

In 2016, companies such as Adobe, Deloitte, General Electric, Accenture and Cargill have ditched annual employee reviews and once-a-year performance appraisals. They gave up the “yank and rank” approach to introduce a revamped performance management process.

Some analysts predict that by 2017 performance ratings and annual reviews will be completely outdated. These are the performance management trends in HR being adopted by companies in 2016:

  • Regular check-ins and constructive feedback at a frequency suitable to the work cycles.
  • Touch-point conversations wherein the progress is reviewed against the near-term goals set by individuals. This approach leads to discussions about the achievements rather than annual reviews.
  • Frequent check-ins put performance development at the heart of HR instead of performance rating. Future focused conversations lead to actions that help the employees grow and progress further instead of retrospective past performance.
  • The team is better accountable for the day-to-day performances and the most efficient members can be quickly rewarded.
  • More realistic and near term objectives are set with performance reviews that focus more on further development rather than assessment.

3. Timely feedback

Recently General Electric came up with a performance management app wherein managers and colleagues record their feedback at their convenience.

With performance management, the HR is able to share feedback between employees and management in a timely manner. Frequent feedback are more effective than yearly reviews. The ratio of feedback should be 3:1 for positive to constructive.

With timely feedback the slackers can quickly be spotted and their weaknesses can be worked upon. Similarly the over performers can be rewarded and asked to share their strategies with the fellow team members. The transparency in an organization increases as a result of performance management. Adobe has seen a surge in the productivity of employees after introducing this approach since 2012.  

4. Simplified performance management

Every HR professional has their own tale of dealing with performance management documents. Before introduction of tools to measure performance, HR teams had to spend days to analyze the employee data. Based on the insights gained, they’d chalk out the action to be taken which left chances for errors.

With the introduction of performance management tools and HR software for businesses, the HR team can come up performance reports of all employees within seconds. This gives them an insight into the further action and training that each individual needs.

Quick, accurate and satisfactory performance related reports lead to greater transparency in the organization.

5. Integrating performance management with HR

Performance management helps the HR analyze, automate, simplify and organize the activities related to employee performance. Regular performance reviews lead to better productivity among team members.

With these advantages performance management is no longer a standalone HR initiative, it has to be integrated in the day-to-day workings of an organization. Employees can set specific goals and the managers can review the progress at the defined time intervals. Based on how well the goals are accomplished, managers assign bonuses and appraisals.

Performance management is revolutionizing HR by providing constant communication between the workforce and management.

Chirantan Patel
Chirantan Patel is the Product Manager at Softwaresuggest & Callhippo, an Inc. 275 company that researches and analyzes software to educate, advise, and connect buyers and sellers of business technology.

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