Performance Management Software: Why Invest in it in 2024

by Srikant Chellappa Apr 29,2021

The People Strategy Leaders Podcast

with Srikant Chellappa, CEO

We are all aware today that we can’t gauge, monitor, and measure work efficiently with the present performance management systems. Measuring employee performance is one of the crucial objectives for every organization and it directly affects their successes. As a result, on the global front, organizations are doing away with the traditional way of managing performance and are adopting the modern approach by using social performance management through credible performance management software. It is not only comprehensive but also consistent and balanced when compared to the traditional annual or half-yearly reviews.

Also Read: How Performance Management Changed in 2021

An effective performance management software can help you increase employee engagement, boost motivation, and facilitate two-way communication. Not only this, it helps in better management of employees and also increases the efficiency and accuracy of employee performance reviews.

While there are multiple reasons why you should invest in a good performance management software, we have some important ones listed out for you here:

Instant Feedback

You know how important feedback is to driving employee engagement and retention. But for it to be effective, it needs to be shared often and on the spot, be it positive or constructive. Performance management software makes sharing and receiving feedback a lot easier for both employees and managers. It allows for consistent and ongoing sharing of feedback on a real-time basis. Instead of waiting for the performance reviews, managers get to share feedback with their employees anytime and from anywhere. Similarly, it gives employees the flexibility to ask for feedback whenever required. Timely feedback helps good employees become better, and the ones who are not up to the mark, get a chance to improve.

As rightly iterated by Ken Blanchard (American Author) that, ‘Feedback is the breakfast of champions.’

Hence, performance management software not only facilitates two-way dialogue but also improves collaboration, which in turn improves employee engagement and retention.

Also Read: How Important Is Feedback In Today’s World?

Rewards and Recognition

Acknowledgement and recognition goes a long way for employees. Just like feedback, employees feel the constant need to be recognized for their work. Receiving timely acknowledgement boosts employee’s confidence, and they get validation for their work. A good way to keep your employees motivated and engaged continuously is to celebrate their wins with them.

Most of the performance management software in the market have a built-in employee recognition and rewards module, which allows you to recognize and reward your employees instantly for their work. For example, using tools like Engagedly, you can publicly praise or award points to your employees.

Also Read: Employee Rewards and Recognition For An Engaged Workforce

Goals and OKRs

Without some goals to achieve, where would we all be? Goal management is an integral process of all organizations. It helps employees to remain focussed on a common goal and in measuring the overall progress of the organization.

A performance management software enables employees and the organization to set clear, SMART, and dynamic goals for themselves. In addition to this, it allows you to cascade your goals and also align them with the organization’s goals. This helps every individual work towards some common goals and have the bigger picture in mind.


Millennial employees care for feedback a lot more than their predecessors. They not only look for feedback from their managers but peers as well.

The multi-rater feedback has already picked up pace in terms of popularity and is a common module of most performance management software. In this process, employees receive feedback from multiple audiences, which includes managers, peers, subordinates, vendors, and customers. Employees get an overall and balanced perspective of their performance. Moreover, it bridges the gap between what an employee perceives and what others think about the employee. It also allows employees to share feedback about their managers anonymously without the fear of getting subjugated.

We can say that multi-rater feedback not only helps in the self-awareness of the employees but also promotes an open culture in the organization.

Also Read: Know What Features To Look For In A 360 Feedback Software

Reduced bias and Transparency

Today many organizations are choosing to inculcate the transparency factor. And in the core of it all, is a good and efficient performance management tool.

Performance management software offers a great deal of visibility to everyone in the organization. Every stakeholder has a clear view of the progress of goals, feedback, and ongoing projects. Moreover, as performance management software logs in data consistently, it reduces the chance of any biases or favoritism towards an employee. This leads to creating a sense of trust and open culture in the organization.

Also Read: 8 Key Features To Look For In A Performance Management Tool

Reporting and Analytics

In today’s data-driven world where everything is predicted and explained in numbers and stats, where would we be without analytics?

Performance management software provides detailed insights about an employee’s performance in the form of graphs and charts. It helps employees to make decisions about their skills and developmental needs. Additionally, it helps managers and organizations to make compensation and promotion-related decisions during the time of annual or half-yearly performance reviews. Not only this, it also saves the employer’s time during the time of reviews as all the information regarding employee’s performance is already there in the performance management tool.

Given all the above benefits that you can draw with efficient performance management software, would you want to wait any longer? We guess not!

Are you planning to invest in performance management software? Then request for a live demo.

Request A Demo

Srikant Chellappa
CEO & Co-Founder of Engagedly

Srikant Chellappa is the Co-Founder and CEO at Engagedly and is a passionate entrepreneur and people leader. He is an author, producer/director of 6 feature films, a music album with his band Manchester Underground, and is the host of The People Strategy Leaders Podcast. He is currently working on his next book, Ikigai at the Workplace, which is slated for release in the fall of 2024.

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