Performance reviews play an important role in an employee’s work life. They decide if an employee had worked well enough to get a promotion, a raise, etc. Most people are conscientious about how they handle performance reviews. After all, nobody wants to be the bad guy, even if an employee’s performance isn’t up to par.
An effective performance management system helps identify employees’ issues and find solutions for the same. This will improve their quality of work and in turn, increase productivity.
However, there are certain performance management mistakes, whether they are made knowingly or unknowingly, that HR administrators, managers, and CEOs should avoid making as much as possible.
Pulakos and O’Leary emphasize in their paper:
Done effectively, performance management communicates what’s important to the organisation, drives employees to achieve results, and implements the organisation’s strategy. Done poorly, performance management not only fails to achieve these benefits but can also undermine employee confidence and damage relationships.
5 Performance Management Mistakes to Avoid
Not Setting Clear Expectations
One of the biggest mistakes that can affect the entire organization is not having clear expectations from your employees. It is important to set clear goals and have your employees understand those goals. When goals are clear, both to the manager and employee, it becomes easier to meet goals. Not having clear goals or expectations can literally lead to everything being a muddled mess.
Your Process Doesn’t Help Employee Development
Your performance management process should help your employees understand their strengths and weaknesses. It should help them improve themselves and know how to achieve their organizational goals. Your process should make your employees feel fulfilled. Most performance management processes tend to focus on the financial aspect of performance reviews when in reality, it should be the opposite.
Holding on to Low Performing Employees
Another big mistake employers make is not letting their low-performing employees go. Low-performing employees become millstones over a period of time and create a lot of resentment among other employees. It’s alright to give employees first and second chances, but beyond that, you need to decide if those chances are worth it.
Hoping For The Best – Waiting for Performance Appraisal to Give Feedback
Managers often make this mistake; they wait for performance appraisals (which are at the end of the year in most cases) to give feedback about their employees’ performance. In order for feedback to work, it needs to be fresh and current. Stale feedback helps no one. Think of it in terms of food. Which do you think gives you better nutrition, freshly made bread or stale bread which is over a year old?
Limited Performance Incentives
One of the most important things about performance reviews is giving incentives. When employees work hard and accomplish their tasks as expected, there’s nothing wrong with rewarding them with some incentives. Incentives are not just monetary. They might be perks and privileges, basically anything a manager thinks their employees might appreciate.
An effective performance management system is beneficial to every organization. It helps managers to guide employees on the right track and recognize the right talent. The lack of such a system in an organization would lead to performance management mistakes, which will result in financial and productivity losses.
Jacqueline Martinez is the Director of Marketing at Engagedly, where she leads initiatives to fuel the marketing-to-sales pipeline through strategic content management, revenue operations, and thoughtful mentoring. She is a growth-focused marketing executive with extensive experience driving multi-million-dollar revenues across SaaS, technology, real estate, oil & gas, and financial services industries.