How do you align your performance management system with your compensation and reward system?

1 Define your objectives and criteria

The first step to align your PMS and CRS is to define your objectives and criteria for both systems. What are the strategic goals and priorities of your organization? How do you measure and evaluate employee performance and potential? What are the desired behaviors and competencies that you want to reward and develop? How do you communicate and align these expectations with your employees? By defining your objectives and criteria, you can ensure that your PMS and CRS are aligned with your vision, mission, and values, and that they support your business strategy and culture.

2 Design your PMS and CRS accordingly

The next step is to design your PMS and CRS accordingly, based on your objectives and criteria. How do you structure your PMS and CRS to reflect your organizational needs and realities? What are the components and features of your PMS and CRS that support your objectives and criteria? How do you balance the different types and levels of compensation and rewards, such as base pay, variable pay, benefits, recognition, and development opportunities? How do you differentiate your PMS and CRS based on employee roles, levels, skills, and contributions? By designing your PMS and CRS accordingly, you can ensure that they are relevant, flexible, and adaptable to your organizational context and challenges.

3 Implement your PMS and CRS effectively

The third step is to implement your PMS and CRS effectively, with the involvement and support of your stakeholders. How do you communicate and educate your employees and managers about your PMS and CRS? How do you train and equip them with the skills and tools to use your PMS and CRS effectively? How do you monitor and evaluate your PMS and CRS to ensure that they are working as intended and delivering the desired results? How do you solicit and incorporate feedback from your employees and managers to improve your PMS and CRS? By implementing your PMS and CRS effectively, you can ensure that they are understood, accepted, and utilized by your stakeholders.

4 Review and adjust your PMS and CRS regularly

The final step is to review and adjust your PMS and CRS regularly, based on your performance data and market trends. How do you collect and analyze your performance data to assess the impact and outcomes of your PMS and CRS? How do you compare and benchmark your PMS and CRS with the best practices and standards in your industry and region? How do you identify and address the gaps and issues in your PMS and CRS? How do you update and modify your PMS and CRS to reflect the changing needs and expectations of your organization and employees? By reviewing and adjusting your PMS and CRS regularly, you can ensure that they are responsive, competitive, and sustainable.

5 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?