Progressive organizations are calling time on traditional performance management approaches.
Instead, they're focusing on performance development - otherwise referred to as continuous performance management - which ultimately sees periodic, formal performance reviews replaced with ongoing feedback discussions.
Discussions that unlock an employee's potential.
The challenge, however, is that moving an organization away from a culture of traditional performance management, towards one of continuous performance development can be an uphill struggle.
But that's not to say it can't be done.
Just take a look at global companies such as GE, Adobe, Accenture, and even Google that have made the switch and are reaping the rewards.
So, how can your organization do the same?
In this article, we'll explore the difference between the two - performance management vs performance development, before sharing eight steps you can take to develop your managers as coaches, and help them create an ongoing performance development plan.
Performance management & performance development: What's the difference?
We’ve all experienced performance management in the form of the annual performance review. A charade where employees are expected to be motivated by a once yearly conversation about their salary, and managers are expected to carry them out regardless of how ineffective they are.
However, a Gallup report shows that what employees actually want from managers is regular, ongoing feedback and communication on their performance and development. They want the opportunity to learn and develop on the job, with accountability, job clarity, and priorities.
But just what is the difference between management performance and performance development?
While performance development is of course an approach to performance management, albeit a continuous one, when we talk about performance management, we're usually talking about it in the traditional sense.
In fact, only ten years ago, about 75% of companies used a ‘competitive evaluation’ performance management model, which saw them rate or rank employees, then force the distribution to remove those at the bottom.
Unsurprisingly, teams that operated within these traditional systems struggled to inspire or develop employees. This was because this outdated model frequently led to misaligned employee expectations, an ineffective and infrequent feedback system, unfair performance evaluations, and a lack of accountability.
Now while significantly fewer organizations are using ‘competitive evaluation’, many are still relying solely on annual, or six-monthly, appraisals as their only form of providing employee feedback.
At Saberr, we believe that the future lies in making sure your teams are having regular, honest, and useful discussions about performance.
These continuous discussions help to support employee performance development, and ultimately require managers to be coaches. In fact, helping managers get into the habit of consistent coaching conversations with their reports should be the primary aim of any new performance management initiative.
Organizations that transform their managers into coaches are better equipped to manage employee expectations, to deliver coaching, and to create accountability. According to Gallup research, employees whose managers involve them in goal setting are 4x more engaged than employees whose managers do it for them.
By creating a culture of performance development that encourages consistent employee improvement, helps employees own their own performance, their personal development and ultimately their career.
How to create a performance development plan
"Understand people's motivations and ambitions to help them take a step in the direction of their dreams", says Kim Scott in her book Radical Candor.
Performance development is an ongoing process and not a one-off meeting, and there are a number of things that managers should do to ensure they’re best equipped to have these performance-related conversations with their direct reports.
Below, we’ve outlined eight suggestions for how to create a performance development plan.
1. Determine the best meeting cadence for one-to-one performance discussions
Regular one-to-one’s are the most effective way of developing employees. Sure, ad hoc conversations by the watercooler may spark innovative ideas, but they aren’t conducive to performance development.
These one-to-one’s need to be frequent - ideally weekly - scheduled meetings between a manager and each of their direct reports. More specifically, they should be a structured check in with a predetermined agenda, so that both parties know what is being discussed beforehand.
But what does a good one-to-one look like?
While these meetings can serve different purposes, a standard one-to-one agenda template for a 15-minute check in might look like:
- Highlights of the last week
- What, if anything, is stressing you out?
- What are you focusing on next week?
- Are there any blockers towards achieving your goals?
- Is there anything I can do to help?
Need more inspiration? Check out these nine additional one-to-one meeting agenda templates, each designed to support your managers in having better conversations around goal setting, career development, reviews, and even feedback.
2. Keep compensation conversations separate from evaluations
Often, the objection to a shift in a less formal performance development system is that compensation is normally tied to performance appraisals.
However, results from a McKinsey survey show that 'effective performance management is more likely when organizations separate compensation conversations from formal evaluations'. And we agree with this.
After all, to have a truly honest coaching conversation where failures are talked about and learned from, compensation shouldn't be involved as it prohibits employees from feeling safe to make mistakes in the name of progression, or even asking for an honest view of where they might improve.
3. Ensure that managers are regularly discussion goal progress
If your employees don't know where they're going or how they're getting on, it can be difficult for them to meet expectations, let alone contribute towards business objectives, team vision, or even their own performance development plan.
By regularly discussing progress towards goals, managers stand to not only motivate their teams, but also ensure that their team members are prioritising the right things, and on track with their own performance development.
4. Create action points based on meeting outcomes
There is no point in managers creating a performance development plan if there are no action points created based on the outcomes of a meeting. After all, if employees don't know what the next steps are, or what they're accountable for, no action will be taken.
The best meetings end with actions or reflections. And tools like Saberr can help.
5. Train managers to provide constructive feedback
A performance development plan may look good on paper, but its success lies in your managers' execution of it.
Here's the thing: According to Forbes, almost 60% of employees believe that the way their managers deliver feedback hasn't helped them improve their performance.
But for your managers to provide constructive feedback and coach their employees, you need to train them.
Fortunately, there are tools that can help. Saberr's digital coaching platform, for example, develops your managers in the flow of their day-to-day work, helping them to develop the habits and behaviors needed to lead high-performing teams.
6. Leverage employee strengths
Psychometric testing is widely used in recruiting, but it shouldn't be limited just to this. In fact, by using a psychometric profiling tool with your existing employees, managers can gain a far better understanding of the individuals within their team.
An understanding that helps them identify areas of improvement, leverage employee strengths, and even redefine roles and responsibilities within the team when necessary.
7. Consider team performance
Performance development isn’t just about individual performance. In fact, we believe that humanity's greatest achievements are the result of teamwork. So, while developing individuals is important, managers also need to consider team performance as a whole when creating a performance development plan.
The question is how? How can managers evaluate and improve team performance?
In short, by working with their team to collectively reflect on what's gone well, and what can be improved on.
This approach to discussing difficult topics and working together to solve problems is a great way to embed performance development into the day-to-day work of team members. Plus, by creating a collaborative, self-improving environment, you not only stand to improve performance, but you can also improve levels of psychological safety within the team.
8. Give managers the tools to support employee development
When establishing a performance development culture within your organization, don't presume managers will know how to actually have the continuous performance discussions that are needed. Or that they'll know how to coach their teams.
If HR can facilitate a great leadership development program for managers, then the incremental impact of the program will last for years.
Which is why you need to be equipping these managers with the right tools and support. A tool that enables them to provide feedback, to access meeting templates that help them structure their conversations, and to develop the habits and routines that lead to high-performance.
Performance development plan examples
Performance development is, in theory, all well and good, but a picture paints a thousand words. So, seeing large, global companies who have made the switch, shifting their focus from telling employees what they should be doing at work to helping them develop their skills as individuals, can make the process seem much more accessible.
Let's look at some examples of organizations that have shifted towards a culture of feedback:
A great example of an organization getting continuous performance management right is Adobe. In fact, since implementing a check-in system that encourages managers and employees to regularly discuss both expectations and career development, they've been able to save 100,000 manager hours every year.
Another example of an organization that's shifted to a culture of performance development is GE. In fact, the company has stopped using performance reviews and ratings altogether, in favor of ongoing check-ins between managers and their employees. Why? To encourage an acceleration in performance.
“Traditionally, performance management, as we would call it, was really a look back. It was formal, it was usually once a year, sometimes twice. But it was always looking backward. And I think in order for any type of performance development system to be worthwhile, it really needs to be about trying to go forward. And that’s really what our shift has been about”.
Google has never needed to work on improving performance management. They were early adopters of the employee goal setting philosophy using objectives and key results to incentivise employees, and have used this high performance development model since the beginning.
These examples show that simple changes like getting teams to have a shared goal and encouraging regular coaching conversations along the way to reach this goal can help you develop performance.
How Saberr supports performance development
Saberr helps develop managers as coaches by helping them with high performance team management. More specifically, we give them the tools and support to have continuous performance conversations with their teams, and ultimately develop as coaches.
To find out more about how Saberr can help you make the switch to performance development, get in touch today.