Did you realize that on average it costs $3,500 to recruit an employee? That’s to recruit a worker earning $8 per hour. Imagine how much it costs to recruit and integrate highly qualified workers!

The fact is that you can save a lot of the expense and disruption of recruiting new employees by being a more effective performance manager. Performance management software keeps employees focused on achieving the company’s goals.

Many performance managers run into the same problems time and time again. If you’re finding it a struggle, read on to discover how to become more effective.

Employees Don’t Understand Their Role

Many employees can do their jobs and even do them well without actually understanding where they fit into the bigger picture. They need to understand that their performance impacts the overall performance of the company. 

To get employee buy-in, you need to engage them in the dialogue about the company’s growth. Seek their input and make them feel included.

When you do this, they will feel a sense of personal responsibility. They’ll understand that their role is crucial to the success of the whole enterprise.

Not Regular Enough

The problem with an annual review is right there in the name. Once a year is nowhere near regular enough to assess employee performance meaningfully. To see meaningful employee improvement, you need to have regular, two-way dialogue.

Start by increasing the frequency of your formal reviews – quarterly or even monthly is ideal. Then structure the reviews around real, achievable targets. It’s not enough for performance managers to set targets – you need to understand how your employee can get there.

This is where coaching comes in. If you don’t feel confident in setting SMART goals and coaching employees to reach them, access some training for yourself. It’s unrealistic to ask your employee to achieve something when you don’t know how you can achieve it yourself.

Give your employees lots of opportunities to speak during reviews and in between. These conversations should be a safe place for them to share concerns, ask for feedback, and get your support with their development. 

Reviews Focus on the Past 

There are a couple of traps that you can fall into in a performance review. 

One is the so-called halo effect. You evaluate the worker’s performance based on the last few weeks – what sticks in your mind. Whether there were triumphs or failures before that, they tend to be swept under the carpet. 

The problem here is that you are not building meaningfully on past performance. Whether they recently did great or struggled, you’re only addressing the here and now. Looking back over their performance over the last few months can give you a better idea of their overall level.

Preparation is key for these discussions. Using a performance management system like Mesh can help you to access these records and conduct reviews that matter.

Another trap is focusing solely on the past in reviews. There is nothing either of you can do to change the past, so solely focusing on it can be frustrating, especially if things didn’t go too well.

So spend most of the review looking to the future. Discuss questions such as:

  • What are your goals and aspirations?
  • How do you see yourself progressing? 
  • What obstacles can you foresee and how can you overcome them?

Listen carefully to the responses and see how they fit in with the general direction of the company. An open discussion can guide the employee to goals that align more fully with the company. This can help you to achieve buy-in, while still meeting the employee’s personal ambitions.

Goals Aren’t Clear

Many a performance manager has struggled with setting SMART goals that are truly SMART.

It has been an accepted performance management and self-development tool for years. Yet all too often, goals that are set for employees are not really clear and achievable.

The best SMART goals are set in collaboration with employees. No one likes to have goals presented to them on a plate, and that’s not the way to achieve buy-in. You can set either project-focused goals or performance-focused goals.

Most goals set in reviews will be performance-focused. For example, I want to make more sales.

The SMART goal format allows you and your employees to talk about how you can get there. 

  • Specific – What is your sales target?
  • Measurable – Improve my leads to deals closed ratio by X%
  • Achievable – I will do this by attending training/shadowing employee X who has a higher turnover rate
  • Relevant – My job is 50% sales, so for career progression, I need to develop these skills
  • Time-Bound – I will achieve this increase in 6 months

In the end, you have a measurable goal and a road map for achieving it.

Tackling Underperformance Too Late

Performance management systems should lead to consistent performance improvement. But of course, in real life that is not always the case. And if underperformance is not tackled quickly, the results can be damaging to a team’s morale.

It’s not easy, but a performance manager must sit down with any employee who is underperforming as quickly as possible. They may not be aware of the problem, or there may be extraneous factors you are not aware of that are affecting them. 

This can be a difficult conversation but it gives you a chance to put measures in place to improve their performance. Do this promptly, otherwise, you might start losing strong performers who don’t want to pick up the slack anymore. 

Not Celebrating Good Performance

Not every business needs an “employee of the month” scheme. But the reason these work in certain settings is because they acknowledge the efforts individuals are putting in.

Financial recognition is another route you can explore. But there are more cost-effective ways of celebrating hard work. These include greater flexibility in working patterns, training opportunities, and extra vacation.

Be the Best Performance Manager You Can

A great performance manager knows that reviews and feedback should not be reserved for once a year.

Create a culture of continuous development. Have regular, open discussions and set SMART goals that are truly meaningful. This will help all employees to keep moving forward and achieving the vision of the company.

If you’d like more hints and tips on how to improve your business, head over to our Business section today!