Performance Management: Redefined
Performance Management: Redefined
Kali June Faulwetter
Batuhan Tamer UsluJunior Consultant
Future of Work, All Industries

Performance Management: Redefined

Performance Management: Redefined
Kali June Faulwetter
Batuhan Tamer UsluJunior Consultant
9/7/2022 - 5 minutes

Traditional performance management models are not being employed as often as they were in the past. They were (and are) being used to make important decisions about employees. Yet, they are not concerned with either the improvement of performance or the management of it. Both the understanding of performance and performance management are improving. The changing dynamics of the world affect the improvement areas. The power that digital provides helps to stay up to date with and implement these changes. Being digital is a necessity to understand redefined management.

Dumping Numb Strategies

The world is changing quicker than ever. Adapting to and understanding changes are two of the most important aspects in such an atmosphere. Being able to do so creates a crescendo effect for companies. They will become increasingly more vocal. The better you understand, the better you adapt.  The better you adapt, the louder and more remarkable you become. But there is a step that is required to switch from understanding to adapting: A strategy. For businesses and their employees to perform better, a functional strategy is crucial.

The difference between past and present is that these days a strategy requires a lot more to be considered a mature one. A linear progression from the beginning to the end of a project with lots of planning is now way too slow. In addition to not being able to adapt at such high speed, "If you want to make God laugh, tell him about your plans" is a good way to explain what is wrong with traditional strategies and management.

The new way of developing strategies should be more adaptable since lots are more reliable are unpredictable. This is mostly caused by digital. Software development brought a new perspective, one that shows how ineffective a man/day calculation can be. So, the traditional shift to a better and more adaptable alternative: agile. This involves focusing on not planning everything beforehand, but instead focusing on continuous delivery and accepting possible unknown outcomes as a part of the nature of a strategy. The interest in agile methodologies such as Kanban and Scrum is, thus, increasing. They allow different units of a project to work simultaneously, rather than completely wrapping up before the next phase begins. Thus, it is directly affecting the business performance.

 

The Right Way to Monitor Productivity

The pandemic was one of the most important challenges that pushed the world to be more digital. Most companies started to apply hybrid and remote working practices during the lockdowns. Arguably it was both positive and negative in different aspects, yet it is certain that it affected the already-quickly-changing world.

A more digital working world has sparked great interest in monitoring the performance of the employees in a more detailed way. Since observation-based monitoring is not entirely possible with remote working, data-based performance observation is the preferred alternative. Even though numbers can objectively tell a lot, they sometimes can be risky and deceiving if not analysed correctly. It is a more efficient way of monitoring, yet proper communication and transparency are crucial to keeping the trust of the employees. So, there is a great opportunity arising as a result of the digital monitoring alternatives, but only if the data-based approach is combined with versatile approaches to non-numerical performances of employees and keeping the employees' trust. Data says a lot, but not everything (at least not yet).

 

Non-Dehumanising Analysis

Data is now being used more than ever for performance analysis (just like everything else). Intelligent technologies are providing some dependable alternatives for manual, observation-based analysis. Employee behaviour is more traceable and observable with the help of digital footprints and records, so an objective approach to increasing productivity sounds quite possible.

Even though digital creates an evidence-based alternative for analysis, it may also negatively affect the performance of employees. Analytics can often be confused with a step towards automation, especially if the employees are treated like pieces of data. Encouraging employees for their personal growth and motivating them, remembering that data is not reflecting everything is an important part of performance management.

 

Setting Effective Goals

Effective goal setting supports effective performance management. For better performance management, the goals should neither be too aggressive nor too easy to achieve. To be able to set the goals more effectively, it should be remembered that the subject of that goal is the employee. Even though monitoring and analysis tools are more efficient than ever, they are highly unlikely to know as much as the person whom the goal is set for. So, the opinions of the employees are quite important while setting the goals.

While doing that, the traditional way of checking the results at the very end is not the most efficient way. Regular check-ins, meeting the changing needs of employees, coordination, and creating the conditions for the employees to keep themselves accountable for results should be the focus for your business to perform better. As mentioned earlier, working agile can be a good alternative to having observable outputs for regular check-ins.

 

Understanding Motivation

There are lots of different factors that affect employee motivation. Satisfaction with the job, including the position, wage, promotion opportunities, working hours, etc. are good examples. This feedback, both observation-based and data-based, can be another example. They are the first factors that come to anyone's mind. But it should not be forgotten that not all motivation factors are common for everyone. Culture is an important aspect to consider.

The local culture of a company and its employees is quite important to understand the source of motivations. For example, motivation in western cultures tends to be more ambition-based and individualistic, whereas in eastern cultures it is more tranquility-based, holistic, and harmonious. People or organisations based in countries with a hot climate tend to be more relaxed.  Robert N. Levine mentions these effects of the local culture in his book "A Geography of Time". He gives the example of Brazil by saying to be 3 hours late may be perfectly acceptable. He also says in Japan, the sense of long-term is a lot different than in western countries. What he says are cultural adjustments are some requirements. So, understanding the local cultural differences is an important part of understanding the employees' motivation, thus, understanding performance management.

Organisational culture is affecting employees more than ever since remote working became a common option. The flexibility of working and development-oriented nature of businesses are now a part of their organisational culture. Also, they are some important determinants of belongingness. Remote working in particular is also affecting the local cultural effects. It is making global a new culture and causing geo-cultural contrasts to fade.

 

How to adapt?

Everything is changing, and so should we. MIT Sloan states "The future of performance management is more data-driven, more flexible, more continuous, and more development-oriented" 

To be able to adapt to the future, businesses should be more digitally mature. We are here to help you with that. Check out our Digital Maturity Index to be prepared.

 

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