Recently a HR.com member wrote in the executive coaching forum, “I'd like to hear from people who have successfully got buy-in and support from leadership on your Performance Management program. HOW did you do it?”
The way to gain support for a program is to explain the benefits in business terms; build a business case.
A well-functioning performance management program is essential for business success, especially when the economy is hyper-competitive. Research which proves this point can be found on some of the following websites: Institute for Corporate Productivity, Gartner, IDC, Halogen Software, Successfactors, Taleo, CedarCrestone, Watson Wyatt.
A well-functioning performance management program allows decision makers to see which skills and strengths employees possess and to communicate strategic goal changes quickly. A performance management program gives much needed information about which employees are working on which projects, and about which projects are on track and which ones need reviewing. Perhaps even more importantly, a performance management program clarifies expectations for employees and gives them the feedback they want about their performance, how to improve and which training to pursue.
Benefits can be seen at three levels: improved organizational success, structure to make managerial tasks easier, and improved employee satisfaction. At the organizational level, benefits include timesavings, improved accuracy, accountability, productivity and employee retention. Performance management improves communication and individual focus and performance. At the managerial level, benefits include timesavings, reduced conflicts, improved accountability, efficiency, communication, performance and employee satisfaction improves. At the employee level, expectations become clearer, self-assessment becomes more accurate, performance improves, visibility into career paths improves and job satisfaction goes up. Performance management positively affects job satisfaction, employee retention and loyalty by giving employees clear feedback and expectations.
Benefits of a performance management program include:
-better alignment between employee’s day-to-day actions and strategic business objectives
-support for compensation and promotion decisions
-improved identification of learning and training needs
-documentation to support cutback or layoff decisions
Technology-based performance systems make the process even easier and allow access to performance related data that is difficult to achieve when a paper-based system is in place.
Furthermore, the costs of not having a performance management plan in place must be considered. When expectations are not clear and are unlinked to strategic objectives, time is wasted, employee engagement drops, and evaluation criteria can be inconsistent. A lack of a performance management system means that documentation to support decisions related to layoffs, promotions, compensation and rewards may not be complete. Unclear performance expectations can lead to poor morale (especially amongst top performers). Incomplete performance documentation can result in a lack of transparency, haphazard training and development and legal issues.
