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What are the key considerations for a performance management strategy in a new business?

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Performance management is the process of setting goals, measuring progress, providing feedback, and rewarding achievements for employees. It is essential for any business to align individual and team performance with organizational objectives and values. However, for a new business, performance management can be challenging due to limited resources, changing priorities, and uncertain outcomes. In this article, we will discuss some key considerations for designing and implementing a performance management strategy in a new business.

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Vivek Gupta

Experienced HR Practioner | Project Management & Advisory | Certified SHRM-SCP
Luke Hextall

Leading People @ Polar Analytics ???? | Talent100 2024 | I talk about People Experience ??, Remote Work ?? and Talent…

1 Define clear and realistic goals

One of the first steps in performance management is to define what success looks like for your new business and your employees. You need to set clear and realistic goals that are aligned with your vision, mission, and strategy. These goals should be specific, measurable, achievable, relevant, and time-bound (SMART). They should also be communicated and agreed upon by all stakeholders, including managers, employees, and customers. By defining clear and realistic goals, you can create a shared understanding of what is expected and how to achieve it.

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Luke Hextall

Leading People @ Polar Analytics ???? | Talent100 2024 | I talk about People Experience ??, Remote Work ?? and Talent Acquisition ??.
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Don’t over complicate it at the start. Many companies won’t have a clear levelling framework and titles across an organisation become unbalanced. Build a small framework of competencies that are consistent for all roles across the business (think your values). Then, add areas of scope, impact and execution that are tailored to each individual role. From here you have a start. You can then drive quarterly goals (1 professional and one development) and tie them in with expected BAU outputs (eg: close $X of new business). Gather feedback. Iterate.

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2 Choose appropriate performance indicators

Another key consideration for performance management is to choose appropriate performance indicators that can track and measure the progress and results of your goals. Performance indicators are quantitative or qualitative measures that reflect the performance of a process, activity, or outcome. They should be relevant, reliable, valid, and comparable. They should also be balanced, covering both financial and non-financial aspects of performance, such as quality, customer satisfaction, innovation, and learning. By choosing appropriate performance indicators, you can monitor and evaluate the performance of your new business and your employees.

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Cleber Guerreiro, PRINCE2, PMO-CP

Gerente de Projetos | PMO | Portfólio | Opera??es | Processos | Excelência | Planejamento Estratégico | Engenheiro
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You’ve gotta zero in on setting sharp goals that line up with the company’s big picture. It’s all about laying down metrics that truly spotlight how the team and individuals are standing out. Plus, you need to foster a vibe where feedback and growth go hand in hand. Say we roll out a quarterly review system that doesn’t just look back but also gears up for the next leg, we’ll keep the squad on their toes and dialed into the business’s forward momentum.

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3 Provide regular and constructive feedback

A third key consideration for performance management is to provide regular and constructive feedback to your employees. Feedback is the information that you give or receive about the performance of a task or a behavior. It can be positive or negative, formal or informal, verbal or written. Feedback is crucial for performance management because it helps employees to understand their strengths and weaknesses, to improve their skills and knowledge, and to motivate and engage them. You should provide feedback that is timely, specific, objective, and actionable. You should also encourage feedback from your employees, such as their opinions, suggestions, and concerns.

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4 Implement fair and consistent rewards

A fourth key consideration for performance management is to implement fair and consistent rewards for your employees. Rewards are the outcomes or benefits that employees receive for their performance. They can be intrinsic or extrinsic, monetary or non-monetary, individual or team-based. Rewards are important for performance management because they reinforce desired behaviors, recognize achievements, and retain talent. You should implement rewards that are aligned with your goals and performance indicators, that are transparent and equitable, and that are flexible and varied.

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5 Review and improve your performance management strategy

A final key consideration for performance management is to review and improve your performance management strategy regularly. Performance management is not a one-time event, but a continuous cycle of planning, executing, reviewing, and improving. You should review your performance management strategy at least once a year, or more frequently if your business environment changes. You should assess the effectiveness and efficiency of your goals, performance indicators, feedback, and rewards. You should also solicit feedback from your employees and customers on how to improve your performance management strategy.

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6 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?

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Vivek Gupta

Experienced HR Practioner | Project Management & Advisory | Certified SHRM-SCP
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Here are some key considerations for developing a PM strategy for a new business: - Ensure performance metrics and expectations map to the startup's objectives and desired values. -Don't over-engineer the process initially. Focus on high-level OKRs and continuous feedback. Add complexity gradually as needed. - With small teams and rapid growth, development needs outweigh evaluation. - Lean towards lightweight, flexible tools vs. complex systems. - With overlapping roles, track contributions across areas. Discourage siloed thinking. - Measure outputs, not just activities - Metrics for engineers, designers and marketers will vary. Define performance distinctly. - Allow for failure - Connect to values - Involve the team

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What are the key considerations for a performance management strategy in a new business?

1

2

3

4

5

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1 Define clear and realistic goals

2 Choose appropriate performance indicators

3 Provide regular and constructive feedback

4 Implement fair and consistent rewards

5 Review and improve your performance management strategy

6 Here’s what else to consider

Performance Management

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What are the key considerations for a performance management strategy in a new business?

1

2

3

4

5

6

1 Define clear and realistic goals

2 Choose appropriate performance indicators

3 Provide regular and constructive feedback

4 Implement fair and consistent rewards

5 Review and improve your performance management strategy

6 Here’s what else to consider

Performance Management

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