A Blueprint for Bringing Out the Best in Today’s Workers

Performance management is the backbone of any successful organization, regardless of size.

For small and medium-size businesses (SMBs), efficient performance management is even more critical. While larger corporations can have extensive resources and dedicated HR departments to handle these matters, smaller organizations often must do more with less. However, this doesn’t have to hinder your ability to foster a high-performing workforce. In fact, it may encourage more creative and personalized solutions to effectively handle performance management, ensuring productivity, and promoting a culture of growth, engagement and retention.

RETHINKING PERFORMANCE MANAGEMENT

Traditional performance management methods often involve annual reviews and rating systems that may not be suitable for today’s employees. The workforce in smaller organizations is typically more dynamic, requiring a different approach; this can be true when dealing with certain workers entering the workforce.

Research shows that companies that conduct regular feedback experience 14.9% lower turnover rates than others.

Frequent check-ins between managers and employees are critical. This allows for quick adjustments, maintains open communication and builds strong working relationships. Regular check-ins also reveal potential issues before they escalate. Embrace continuous feedback as a cornerstone of performance management. Smaller teams can more easily adapt to real-time feedback. Managers should aim to provide feedback on an ongoing basis, highlighting achievements and addressing areas for improvement promptly—and take immediate action to course-correct before they escalate. Of course, all the feedback in the world is meaningless if there isn’t a clear target to hit. Unlike larger corporations, where employees might be working on a specific aspect of a project, smaller businesses often require employees to wear multiple hats. This means establishing well-defined objectives or goals that align with the company’s strategic vision is vital.

INDIVIDUALIZE DEVELOPMENT

Reaching goals can be difficult if your employees don’t receive training not only to master their job’s tasks but also to keep improving upon their weaknesses.

Unlike enterprise-level businesses, smaller ones have the advantage of being able to tailor development to the employee’s unique skills and career aspirations. Create personalized development paths that address your employee’s growth areas, aligning them with the organization’s long-term goals. Remember, there are three phases to employee training and development that your performance strategy need to address and it should begin on day one.

? New in role—In addition to learning the technology, company procedures and goal setting, this is also a time for honing existing skills so employees can grow their expertise.

? Competent in role—While this is a time to reinforce what they know, it is also a good time to allow your employee to take on additional responsibilities and gain more in-depth knowledge about the job, business and overall industry.

? Subject matter expert—This is a time to continue learning about the industry through events, certification courses and other learning opportunities. Also, this is a great point for those who want to move into leadership positions to get specific development opportunities in people leadership, budget management and more.

THE NEW, AGILE PERFORMANCE REVIEW

Performance reviews are standard practice, but like other aspects of your business, modernizing them can make them more effective particularly as you work with a growing number of employees who have experienced continuous feedback, coaching and open dialogue. With the ability to communicate in real-time through technology, today’s workers are probably more used to constant constructive feedback than before. Instead of the traditional annual review, you can opt for quarterly or even monthly check-ins to ensure that employees are on track and aligned with their goals—or skip them all and utilize an agile performance management strategy. In today’s agile environment, continual communication between you, your managers and your workers should keep employees engaged and aware of the good things they are doing as well as what might need tweaking along the way.

TAKE AN EMPLOYEE-BUSINESS, STRATEGY-CENTERED APPROACH

Your business can differentiate itself by putting employees alongside your business objectives at the center of your performance management strategy. By doing so, you can foster a culture of engagement, loyalty and productivity that connects employees’ passion and purpose to your business goals. Here’s how to achieve an employee-business centric approach:

? Employee voice Value employee input and opinions. Your business can create a more open and inclusive atmosphere where employees feel comfortable sharing their thoughts and concerns as part of a two-way performance management system. Regular surveys, suggestion boxes, or one-on-one meetings can help gather feedback and ideas. Additionally, employees can help management understand how to effectively merge corporate goals and personal goals into their performance and how leadership can support them.

? Consider employee skills and passions Traditionally, reviews compare production to individual and company goals and discuss missed opportunities or deficiencies. Instead of solely addressing weaknesses, highlight an employee’s strengths and help them leverage them for better performance. Perhaps during a review, you may realize that the person is better suited to help the company from another department or that you can best utilize their natural talents by tweaking their job description in line with business objectives.

? Take a 360-degree approach Another trend growing out of group dynamics is that some workers are accustomed to 360-degree reviews. These reviews involve peer, subordinate and manager feedback, providing a well-rounded view of an employee’s performance. They can be particularly valuable in smaller businesses like yours, where teams often work closely together. Keep in mind, though, if poorly executed it can cause significant erosion of trust and loyalty.

LEVERAGING TECHNOLOGY AND DATA

Your business can leverage technology and data to streamline performance management processes. By investing in performance management software, you can utilize tools that simplify the process of setting and tracking goals, providing feedback and conducting evaluations. These tools can reduce administrative burdens, allowing more time for focus on employee development. While your day-to-day performance can be improved through the power of technology, so can your overall decision-making. By tracking performance metrics and employee feedback, you can identify trends and areas for improvement. Data-driven decisions can lead to more effective performance management strategies. One way you can leverage technology is to use data to personalize training and development plans, ensuring that resources are allocated efficiently, and employee skills are continually enhanced. However, there is more to it than that. Performance management often involves administrative tasks, such as scheduling evaluations or reminders for feedback. Automation can free up valuable time and ensure consistency in these processes.

TRAINING AND DEVELOPMENT

In the rapidly evolving business landscape, learning and development are critical. You can foster a high-performance culture by prioritizing ongoing training— whether through mentoring, shadowing, cross-training, live training, or online and video options.

? Build training into your budget. Investing in classes or speakers, offering incentives for experienced employees to mentor or utilizing outsourced HR services can be effective means of providing employees the training and resources they need to stay current in their roles. This investment not only benefits the individual but the entire company as well.

? Implement cross-training initiatives. Small organizations often require employees to have a broad skill set. Cross-training enhances employee skills and strengthens the team by ensuring that multiple individuals can fill critical roles.

? Encourage mentoring and coaching. Personalized guidance from experienced team members can accelerate employee growth. SMBs should facilitate mentorship programs to provide employees with valuable insights and support.

? Create a feedback-driven culture. Feedback should be an integral part of the learning process, helping employees understand where they need to improve and where they excel.

? Understand the desired outcome. Develop ways to measure the effectiveness of your training so you can continuously improve upon it. Performance management presents a unique set of challenges for SMBs. And as with many aspects of business, moving away from “the way we’ve always done it” could be the key to getting the best out of today’s workforce.