Performance Management

What is Performance Management?


Performance management is an important strategy that focuses on the tasks that employees perform, how they behave during the execution of these activities and the results generated from them, in order to create a work environment where everyone can develop their skills, fully and satisfactorily

In this way, organizational performance management is configured as a process, where each daily activity is an opportunity for advancement. Thus, the capabilities of this management go far beyond occasional periodic evaluations, as the analysis is carried out on a daily basis, giving the manager greater control and an accurate view of the performance that each employee presents.

The fundamentals of performance management are found in the following characteristics: evaluation, monitoring, control, planning and improvement. Being a great way to know how to measure employee productivity and also to increase it, aiming at retaining talent in the company.

Therefore, performance management in companies proposes to form a link between individual and group performance, their results and a gratification for them, generating more satisfaction and motivation to the employee.

It is worth remembering that the goal here is for all employees to be able to leverage their skills. That’s what makes a healthy and productive company!

With this in mind, it is important to keep in mind that performance management is closely related to the company’s principles and culture, and it is important for the company’s organizational objectives to be gradually achieved, through an increase in overall performance in all. the sectors.

With that in mind, you might be thinking:

What is Organizational Performance Management?

Performance Management

Organizational performance management is a facet of administration and business whose main objective is to unify any and all tasks that are performed within an organization, so that productivity and staff are optimized.

Thus, there is a strong importance of key performance indicators related to all activities.

Performance management is a process that aligns organizational goals with joint personal growth related to the tasks performed by employees. Finally, the union of the two concepts enhances the reach of business purposes.

A clear example of tools that promote performance management is QRPoint, which has several features integrated into a single system. With it you are able to keep all your HR processes organized and optimized.

In addition, with all tasks united in one place, the HR sector is able to focus on the main source of growth for companies: the people in the organization!

So, with such a great possibility of increasing productivity, you must be wondering what precisely the role of task management is, so check it out below!

How does Performance Management become an advantage for your company? 

In principle, having a tool that unifies tasks makes employees better understand their responsibilities within the organization.

On the other hand, managers know precisely the strengths and weaknesses of each employee and, consequently, employees are and feel motivated to improve their performance in the company.

Another benefit of Performance Management is the recognition of talents within the company itself, which ends up becoming easier when perceiving the individual development of each employee.

Even so, one of the strengths of performance management is the strengthening of the company’s values, those that are involved with the organizational culture.

In this sense, when the company’s culture is understood, as mission, vision and values, it is much easier to perceive problems from an early stage, identify future problems and avoid them through an early diagnosis.

In addition, this tool allows for the strengthening of the solid base to outline all performance goals and also brings improvements and precision in the planning of hiring and selection processes.

Undoubtedly, performance management is one of the factors responsible for reducing employee turnover. Anyway, the gains are numerous and don’t stop there, after all, the main advantage sought is the improvement of the company’s general performance, beyond just profit.

Therefore, another important aspect measured through performance management is its ability to remain in the market generating profit in the future.

How does Performance Management relate to the Balanced Scorecard?

It is often said that for a company to remain in the market, it is enough to be in good financial health. However, other aspects must be evaluated to remain in the market, as well as performance management.

Thus, the Balanced Scorecard was created , which dictates certain perspectives, based on cause and effect, that your company must measure jointly, in a balanced way. Are they:

1- Financial perspective: with a view to growth and profitability based on the business cycles of growth, stabilization and harvest.

2- Customer perspective: dealing with customer satisfaction, loyalty, retention, acquisition and profitability.

3- Internal processes perspective: targeting the innovation process (creation of goods), operational process (production of such goods) and the after-sales service process (such as support)

Perspective on learning and growth: regarding the capacity of each employee, as well as their training, alignment and level of satisfaction.

These advantages, together, are able to take your business to the next level, keeping you away from the dreaded stagnation! However, when it comes to performance management, many questions can arise. One of the most common concerns performance evaluation.

What is the difference between evaluation and performance management?

Firstly, the difference between evaluation and performance management is that evaluation is a tool with which past results are analyzed, in a timely manner.

Management, on the other hand, is an innovative and broad process that enhances and manages the performance of employees, with evaluation as one of its phases.

Therefore, the evaluation is the final stage of the performance management cycle. It is important because it fulfills the function of establishing what will be the reward offered to the employee based on their results. In addition, it also marks when you should start a new cycle, contributing to the development of each team

In addition, the evaluation also has the characteristic of being a less inclusive process, as it is applied by the company’s human resources sector, together with the main managers of each area, constituting a top-down analysis of the employees.

Therefore, performance appraisal approaches also have the contrasting characteristic of having more stagnant processes in relation to performance management.

Usually, it is done through questionnaires to be answered taking into account the behaviors and results of employees.

It’s time to get to work and set up a performance management scheme for your company! Check it out below:

How can metrics relate to Performance Management?

Performance Management

In principle, the relationship between metrics (KPIs) and performance management occurs with such metrics being part of a whole, which is management. In this way, alas are useful for measuring and compiling objectively and concretely how employees are performing.

They are divided into several types; the main ones are:

quality KPIs

They serve for the manager to have a systemic or holistic view that helps in understanding failures that may have occurred in any part of the business processes.

strategic KPIs

They help to monitor, comply and measure the results of the strategic plans drawn up by the company at the beginning of a period of time (annual, for example), providing an overview of the current context.

Profitability KPIs

They provide a basis for analyzing the company’s liquidity ratio, as well as increased costs, cash flow, growth percentage, providing data for a good monitoring of such characteristics.

capacity KPIs

They measure the relationship between the time spent in the company’s activities and the amount of what could be produced in that period.

But just having control of metrics does not generate results, if there is not a good methodology being applied when transforming this data into action.

What are performance management cycles?

First, the performance management cycles are the pre-defined timeframes where an employee productivity assessment period takes place.

However, the cycles begin with the demarcation of performance expectations and end with the evaluation of such performance.

In that sense, their goal is to keep the feedback happening at a pace that favors the company’s growth. Studies have shown that employees who contact the goal quarterly are at least 3.5 times more likely to have better results.

However, despite the tendency to switch from annual reviews to quarterly or monthly, the daily leadership method is what can bring you the best results.

After all, leaders who encourage daily achievements through recognition of effort and success and feedback on activities that need to change or that are going well have had very positive results.

This can be done through regular fortnightly conversations of short duration, just so that the employee can understand how their performance is going, receive feedback on progress and achievements during training, or any other guidance that needs to be done to better direct them to the common goals.

What are the 4 stages of the performance management cycle?

1. Setting expectations

In principle, expectations must be aligned between managers and employees, each one must be clear about their obligations to fulfill.

In other words, being detailed here is crucial, both when putting the expected results on the table and when solving any and all doubts on the part of the employee.

In addition, the proximity between the team and the leader at this moment is a catalyst for success! It is very important that there is no doubt on the part of employees regarding the goals, their role and the planning carried out.

2. Follow-up

This is the longest phase of the cycle, here the manager fulfills the important role of inspecting the activities, leading the employee and judging whether the tasks being performed are generating purpose for both the employee and the company.

Fostering a feedback culture here is crucial. This makes the end of the cycle not necessary for a constructive evaluation to occur. This done correctly generates security on both parties, motivating the employee when the answer is positive.

3. Performance evaluation

Here comes the entire evaluation process that has already been discussed in this article. Evaluating potential, behavioral, sentimental, technical, etc., depending on HR’s choice and objective.

At this point, the use of software facilitates data collection. From them, the manager must make an analysis that will serve as a basis for the last phase of the cycle.

4. Development interventions

Here’s a step-by-step guide on how to do it. Here, the planning of practices takes place with the aim of developing both individuals and teams. Such actions should be based on the company’s growth goals for the next cycle, encompassing the organizational objectives.