At Actus we try to be all about evidence-based performance management and get beyond the spin that is so prevalent. You may remember that we outlined 4 out of 8 key evidence-based performance management practices in our previous blog: 4 effective performance management practices for managers to use. These recommendations came from a literature research review that we commissioned Dr Nuno da Camara a Lecturer in HR and Organisational Behaviour to undertake for us. (You can download the full research review at the bottom of this blog). This research shows that good performance management practices can be influenced in a variety of ways – by the individual, by HR, and by the organisation.

All 8 of the findings had been shown, through research to increase employee performance across a range of organisations. We focused on the first four activities in our previous blog because they were under the control of the manager. This meant that almost anyone could put them into practice.

This follow-up blog focuses on the other four drivers of high performance. They relate more to Organisational Culture and processes and can be influenced more directly by HR.

Evidence-based Performance Management Practices:

There are 8 key practices in the literature review and we dealt with four in our previous blog. The four that we want to focus on in this blog are as follows:

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1. Communication and Transparency
2. Climate of Trust
3. Rewarding Performance
4. Training Managers

1. Communication and Transparency

The annual appraisal or formal performance management processes are often criticised for a variety of reasons. (Evidence suggests this is important to most people – see point 3). One key criticism centres around the levels of communication and transparency surrounding it. There is no doubt that minimal communication or transparency has a negative impact on the effectiveness of the process. This raises a key question to those who want to ditch the annual appraisal. How can we possibly allocate reward or manage progression fairly without it taking place behind closed doors?

Our view here is to focus on embedding a transparent and consistently well communicated year-round process. Don’t try to fix cynicism by changing the process unless you are sure it is the problem. Consider first how your performance management process is perceived and how consistently it is applied. It may well be that the issue is the application, not the process.

A consistent performance management process is key!

We believe that to allocate reward fairly in line with performance then we need to have a consistent performance management process. This needs to involve both parties and to be both transparent and fair. This doesn’t mean that all staff will like the outcome but they can respect that it is consistent.

This means that if you use ratings, managers should be encouraged or instructed to talk to their team members about certain performance rating whether they are indicative or absolute. Try to avoid decisions being made behind closed doors, although we would encourage a calibration process with ratings. However, if the rating changes, ideally the manager should sit down and explain why it has changed. This takes courage from our managers and it may be that we need to invest in supporting and developing them to communicate openly and consistently. As a result, this will directly affect the way your performance management process is perceived.

2. Climate of Trust

Building a Climate of Trust is our second evidence-based performance management practice which organisations should focus on. Whether a climate of trust is built or not will largely depend on your team of managers and their actions. Therefore, the organisation must focus on managerial behaviours and ensure that they are conducive to building trust.

Are your leaders demonstrating the right behaviours?

For example, if the manager were to say that they really valued holding regular one-to-ones with employees but then constantly cancelled them due to other pressing priorities, then this creates a climate of mistrust. It is really important to have that trust if we want to see high performance amongst our employees. Otherwise, you can go through the motions of various performance management activities which will be ineffective.

Feedback was identified in our previous blog as an evidence-based high-performance activity that is under the control of the manager. However, if the individual receiving the feedback does not believe the manager or feedback giver has their best intentions at heart then it will be counterproductive because no trust exists. It is likely that they will shrug off the comments and continue their business as usual (Mone and London, 2009).

Think about whether your leaders model the behaviours that you are expecting from your performance management process or whether they last to set objectives, give feedback, or generally model good behaviour. Every time someone senior acts in a way counter to your organisational messaging, it breaks trust. Consider how you can call them out or at least hold a mirror up to their behaviour. Perhaps starting with 360 or peer-to-peer feedback. A climate of trust is all about culture. It is nebulous and affected by a great many things but largely the behaviours of managers and leaders. If you are trying to embed good performance management practice then the whole organisation must be aligned to build trust. It is important to consider this from the start.

3. Reward Performance

We mentioned rewarding performance earlier on in this blog and often we consider monetary reward first of all. Certainly, in relation to performance-related pay, this is most commonly a salary or bonus. However, is that the only or even the most effective way to reward others?

It is our belief that when organisations look to reward employees, it does not have to involve money. It could involve days of holiday, sending staff on a development programme or being on an employee panel to take part in shaping the new company culture. There are so many ways in which you can reward people. It is about getting creative and thinking outside the box as to what these rewards could be and aligning them with the interests or motivations of the person in question. People are motivated by different things and often this is not money. Understanding what does motivate them is key, as is using a trusted system that is fair in determining who should receive a reward for their performance.

4. Trained Managers

In the UK, we often hear that managers lack training and little time is invested in fitting them into a managerial role. This can be due to staff receiving promotions into a managerial role with little to no training. This can have a detrimental effect on the teams they are managing, especially if they aren’t a ‘people person’.

Part of the issue here is that many organisations do not place importance on people management. One of our clients suggests that if you’re a people manager with more than 3 or 4 people reporting into you, then you should set a minimum of 20 percent of your time to spend on people management activities. They trained managers in these activities and also helped them to understand why they were important – to deliver engagement, retain and develop staff. So managers bought into this and it made it harder for them to avoid if they didn’t have the people gene as they also came up with an overall manager charter that listed 10 behaviours that were expected. For example, being specific about managers holding a monthly one-to-one with each member of their team rather than just asking them to conduct regular feedback.

Summary

In this blog, we have highlighted that evidence-based performance management can be influenced in a variety of ways – by the individual, by HR, and by the organisation. It may not be achievable to be perfect all of these performance management practices but tweaks in certain places can only help your organisation and people perform better. For more information on this topic, use the buttons below.

At Actus, we offer more than free HR resources and great performance management software! We also have a team of organisational development consultants who are on-hand to help meet your performance management needs or requirements for culture change. In addition, if you would like to find out more about this service, why not get in touch by contacting us here.

The HR Uprising Podcast: What really works in Performance Management

Research Paper: What drives high performance