The Fundamentals of Performance Management
There’s a lot of debate in the HR world about what performance management process employers should use. The annual performance review, once the standard, has fallen out of favor with some employers. They’ve opted instead for more frequent feedback about performance, sometimes involving the employee’s peers in addition to their supervisor. Others, to be sure, still prefer the traditional annual performance review.
The right process to pick depends in large part on what you want to accomplish with performance management and what you’re willing to invest in it. Here are some principles to keep in mind when deciding on your policy and performing assessments:
Performance reviews are often stressful and difficult because the employees don’t know how they’ll be evaluated and they’re worried they’ll be surprised with a bad review. But reviews, however often they’re done, shouldn’t be a surprise. If you give employees regular feedback on their performance and address poor performance when it happens, then the review becomes more of a reminder and summary of what employees are doing well and where they have opportunities to improve.
Setting clear performance expectations and holding employees accountable to them improves efficiency and productivity. It also improves morale. Conversations with an underperforming employee may be challenging, but allowing poor performance to continue unabated can cause widespread frustration and resentment from coworkers whose work is affected by it. Ignoring poor performance only compounds the problem.
Employees are more likely to take ownership over their performance goals if they have a role in defining those goals.
Connecting performance measures to company objectives and values can increase employees’ sense of purpose and engagement by drawing a direct correlation between their individual work and performance and your collective success as a company.
It’s helpful to structure performance evaluation meetings and conversations around the specific expectations set in the job description to ensure that the discussion is directly applicable to that employee’s particular job duties.
Documenting performance evaluations can help you justify pay increases, decreases, or other employment decisions like termination that could be challenged as discriminatory. It’s safest to terminate an employee when you have documentation that justifies the legitimate business reasons for the termination.
How to Evaluate Your Culture
This article is the third part of our series on workplace culture. In the first installment, we explained that every organization has a culture, and every culture has three components—the organization’s rules, traditions, and people. In the second article, we showed you how to identify the culture that you have so you’re able to assess whether it’s the culture that you want. Both articles are linked below. We turn now to the question of evaluating your culture.
The specifics of a good culture vary from company to company, but there are a few general qualities of a good culture that you should aim for whatever your industry and mission. A good culture should be:
- Well-defined and understood;
- Embraced by people in the company;
- In alignment with your mission; and
- Beneficial to the long-term success of the company.
Is Your Culture Defined and Understood?
If you asked your employees to talk about your company culture, would they know what to say? Would they have similar answers? Could they point to a mission or vision statement? Maybe a set of core values and shared beliefs? What about company policies and procedures? In short, do they know how people are expected to behave and interact in the workplace? Do they know the rules? The traditions?
You won’t have much control over your culture if you don’t clearly define it. You don’t need to write down every expectation, but they should be evident in some way. That said, written statements really do help. Add them to your company handbook as a way to communicate those expectations and hold everyone accountable to them.
It’s also good to take time to discuss your culture—maybe in a quarterly meeting or at an annual retreat—that way everyone understands it and knows how they can play a role in cultivating and developing it. By discussing the culture that you have as well as the culture that you want, you can work through any ambiguities and ensure you have alignment and buy-in. And if you discover that your ideas about the organization’s culture are not well-received or agreed upon, that’s useful information to have, as your roadmap for success will look different depending on the kind of culture you have in place.
Is Your Culture Embraced?
If you’ve defined your culture and clearly communicated it to employees, the next question to ask is whether your employees embrace it.
It’s important that the people who work for you believe in the purpose of the company and ways you set out to achieve it. A company that prides itself on honesty and being helpful doesn’t want salespeople who lie about the products and manipulate customers. It wants professionals who value truth and integrity.
When you look at your defined culture and evaluate how much it’s internalized by employees, you may find that not everyone buys into it. This may be expected, but don’t settle for indifference. Make it a point to emphasize that the culture you’ve defined is important to you. To start, the leaders in your organization must live the culture themselves. Interact with employees the way you want them to interact with you.
Remember, though, that culture isn’t set in stone. It’s always developing and adjusting since culture lives and grows out of the way people in an organization think, feel, and act. Each new person you bring in will contribute something new to the culture. New habits. New perspectives. New ideas. So, encourage employees to make the culture their own and encourage them to contribute to it.
Is Your Culture Aligned with the Mission of Your Organization?
Let’s say your culture is clearly defined and most of your employees embrace it. What’s next? Make sure your culture is aligned with the good of your organization. Your organization has a purpose. Does your culture help further the purpose, does it sabotage it, or is it a mixed bag?
When identifying and assessing your rules and traditions, make sure they all work together and don’t undercut each other. Suppose as a company you encourage employees to be innovative, but you also don’t put up with mistakes. What would happen? You’d likely stifle innovation. Employees would avoid sharing new ideas, since they’d be worried they might make a mistake.
Also take a good look at the cultures of each department and each team. These smaller groups will have their own ways of interacting and doing things, and that’s okay, but their micro-cultures shouldn’t fundamentally conflict with the larger organizational culture.
If your overall culture isn’t aligned with your mission, or if the cultures of some departments don’t match the cultures of others, this can create conflict and disorder. If people aren’t united behind your company’s purpose, they likely aren’t all following your rules or traditions, either. And that can create resentment and frustration, hurt morale, and stifle productivity.
Is Your Culture Conducive to Long-Term Success?
Among the most important questions to ask when evaluating your culture is whether it’s conducive to the organization’s success. Your core values and practices might all be in alignment, but what if the values themselves, or the mission or vision, aren’t good for long-term sustainability? There’s a possibility that the core values you defined aren’t really the best ones for you to have. Maybe your current mission and vision won’t take you as far as others could.
One way to answer whether your culture will lead to success is to analyze your recent successes and failures, asking why each happened. For this analysis, you would examine the underlying reasons why people acted the way they did. If, for example, a project failed because there was a breakdown of communication, you’d assess whether the existing policies and procedures for communication played any kind of role. Maybe the rules for how people communicate weren’t clear to everyone. Or perhaps people weren’t sharing information because they didn’t trust one another, in which case you’d want to discover why they didn’t trust one another. If your rules or traditions are causing problems, they may need to be revised or abandoned. On the other hand, if they’re contributing to your successes, look for ways to strengthen them.
Check back next month for the final installment of this series, where we’ll explain how to improve your workplace culture.
