Original source: https://hrwize.com/performance-management-improved-retention/
Performance management’s purpose goes beyond ranking people once a year to define their bonus. As a vital part of any company’s HR management process, the performance management process contributes to the alignment between business strategy and individual goals and expectations. It represents an opportunity for employees to receive feedback and get clarity on potential development and growth. So how come performance reviews generate so much dissatisfaction with managers as well as employees, becoming a dreaded meeting for both?
The client’s desired changes
In our client’s case, they were a medium-sized organization who wanted to move away from the standard performance management model of annual or semi-annual performance appraisals. They wanted a lighter process focusing on a few key indicators (rather than a detailed form). Performance management had to be regular and forward-focused, rather than looking in the rear-view mirror. Employees had to be involved and actively contribute to the process, rather than the current top-down approach. Our client felt that these changes would allow for more meaningful discussions between employees and managers and boost employee engagement.
New performance management with HRWize
The HRWize team designed a more frequent performance management process that promoted interaction. Thanks to the increased frequency, managers recognized good work immediately, proactively identified performance hurdles and secured help for their employees quickly. The form was simplified, limiting the monthly questionnaire to only four questions that were worded simply and personally. A specific section allowed employees to record their own achievements before managers added their own comments. The performance review meetings between managers and their employees took place monthly, for 15 minutes.
In this case, the HRWize software allowed us to adapt the client’s evaluation forms easily and provide access to both managers and employees for their particular sections. To encompass a variety of points of view on the employee’s performance, we introduced electronic requests for 360 reviews that could be completed within the software. We were also able to run reports and compile analytics at the company level.
When quantifying results for the new performance management program, we learned that the client’s turnover rate had been reduced by almost 10 percent. The regular meetings created a deeper relationship between the employees and their direct managers, enabling them to clarify expectations and see the progression towards results. Recognition became much easier to pinpoint and highlight. The development and training possibilities became easier to plan. Our client gained a deeper understanding of the needs of the organization’s roles and what it took for employees to prepare for next steps in their careers if they so desired. All of these results led to a dramatically improved retention rate as well as a positive engagement in the company.