For more than half a century, managers have been following the same approach to employee performance management. In a more varied and fast-moving world of work, is it time to make a change?

The Annual Appraisal Problem

Since the mid-20^th century, annual or six-monthly appraisals have been central to employee management. Once or twice a year, employees sit down with managers and evaluate how they’ve been doing. This has been made more effective through the establishment of clear targets and a growing focus on aligning with core company objectives. But it’s far from perfect. These occasional, arduous appraisals have become a source of dread for employees, who see them as a time of judgement. And they’re a heavy burden upon managers because of the time and effort involved. Furthermore, with up to a year between appraisals, objectives often move, while employees feel unsupported in their work and on-going goals. Modern businesses are expected to be agile in their approach to the rest of their business, shifting quickly and flexibly in line with changing circumstances. But employee performance is still managed through a framework that’s monolithic and cumbersome.

So what’s the alternative?

A More Agile Approach to Appraisals

A more modern approach is to adopt a continuous performance management framework. This is a faster-paced approach to employee management, one that’s more responsive to events. So what does this mean?

• Instead of yearly appraisals, managers meet regularly with employees to assess how their progress.
• Check-ins take place every month or two.
• Regular conversations as part of the daily routine help you keep track of progress.
• Both sides record achievement towards goals on an ongoing basis, rather than hastily throwing the evidence together just in time for an annual review.
• Continuous performance management integrates the process of appraisal into the regular routines of working life, instead of turning it into a huge, time-consuming standalone task.
• It lets you regularly evaluate both the relevance of objectives and progress against them.
• This creates a different dynamic between managers and staff. The barriers between them are broken down through regular, small scale interventions.
• This encourages a more nurturing, coaching environment, with a focus on helping staff meet objectives rather than judging them against those goals.

As a result, it can make performance management easier and more effective for everyone involved.

The Benefits of Continuous Performance Management

This approach to people management brings a range of benefits.

It makes the business more agile – Regular meetings mean that you can set employee objectives against both short- and long-term goals, calibrating them as the aims and strategy of the business shift.

Regular meetings keep employees focused on their goals – Receiving frequent support in place of occasional judgement means that they are also more likely to achieve those objectives.

Aligned to business goals – Regularly evaluating employee objectives and keeping them aligned to business goals makes them more useful and applicable.

More achievable business objectives – The wider aims of the business are more likely to be achieved if individual efforts can be focused on them.

Increased staff engagement – With its emphasis on coaching employees, continuous performance management fosters a sense of achievement and ownership over the work being done. This contributes to greater engagement with work, more robust morale, and better results.

Closer working relationships –  The system also generates closer relationships between team members and line managers. Regular check-ins mean that managers are more aware of the challenges their teams face and the progress they are making.

Performance issues address sooner – This allows problems and failures to be identified and addressed early on. The problem can be nipped in the bud, saving months of unproductive work.

Implementing the New Approach to Employee Performance Appraisals

So, how can you go about introducing this approach?

1. Engage with managers. They are the ones who will have to make it work. Show them the benefits and ask how they could help implement the system. Give them ownership over the new process.
2. Make sure that you’ve got appropriate systems in place to support the new framework.
3. Advice and training will be essential for managers not used to running regular check-ins.
4. A suitable way to record progress is also important, whether it’s a tailored HR system or something as simple as a template in Word to record the results.
5. Give guidance to team members, showing them how they can demonstrate regular progress against their objectives, and encouraging them to seek support through the check-ins.
6. This approach is about encouragement and coaching, but at first employees may see it as something intimidating.
7. Encourage everyone to focus on achievement in their meetings, to create a positive atmosphere.
8. Allow them the freedom to change objectives as they become irrelevant to the organisation’s goals, instead of forcing them to stick with aims that should have been abandoned months ago.

Continuous performance management is a more agile and effective approach to employee management. With careful implementation, it can bring huge improvements to your business.

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