KPIs of Performance Management Systems

Most companies act as if an effective performance management system simply tracks and measures its employees’ performance.

Those companies are wrong.

In today’s workforce, employee engagement is a huge undertaking. Simply focusing on a performance management system to consistently track and manage performance appraisals for their own sake will only lead to unengaged, unmotivated employees.

Creating an engaged workforce is critical to your organization’s success. Companies with unengaged employees end up wasting money, time, and worst of all, talent.

Still not convinced? Look at these statistics:

• Highly engaged teams show 21% greater profitability to their company
• Disengaged employees cost U.S. companies up to $550 billion a year
• 89% of workers at companies that support well-being initiatives are more likely to recommend their company as a good place to work

So, how does employee engagement impact your performance management system?

Successful businesses gain an advantage when there is ongoing dialogue and input aligning employees’ goals with businesses. In fact, 89% of HR leaders agree that ongoing feedback and check-ins are key for successful outcomes.

When searching for a performance management system, you want a system that engages, inspires, measures and coaches.

These systems should also have these five components:

Clear metrics and ratings: A performance management process shouldn’t simply be designed to measure and track success. There’s more to employee performance software that provides easy measures of success with custom ratings and benchmark goals. In order to stimulate growth and success, you need an objective set of metrics to evaluate everyone by the same criteria. You should also understand that some criteria have more weight than others.

Positive employee experience: Employees shouldn’t dread the performance management system simply because of navigation issues or archaic practices. Rather, find a software that’s intuitive to use with e-signature, cloud-based and has a self-service portal that issues alerts, emails reminders or displays progress bars so that goals are clear and always on an employee’s mind. In fact, if you link your performance management software to an employee experience platform, employees can track, modify and visualize their ambitions right from the landing page.

Compatibility between systems: Systems should be social. Software is not intended to live or play on its own. Rather, find a solution that are not only is compatible with your current human resource management system (HRMS), but one that engages with your current employee management system. Look for systems that can integrate with office productivity goals, seamlessly transfer data through the cloud to your existing software, and makes performance management social.

Mixes performance management strategies: Companies like Apple, Google, and Netflix are 40% more productive than the average company by using a mix of employee performance management strategies that focus on organizational structure and trust-building. It makes sense! No two individuals are alike, nor should they be expected to perform based on the same feedback and measurements. Find a system that can be flexible and uses a mix of measurements, analytics and coaching.

Provides opportunities for development: Employees want to be challenged and want to engage in opportunities for professional development and self-growth. Find a system that first identifies, empowers and rewards leaders with incentives and simple progress tracking. Then, find a performance management system that also provides – or integrates with – a system that can provide learning content to connect employees to information and expertise based on their interests, position and ambition.

About CEM Business Solutions: Based in Montvale, NJ, CEM Business Solutions is a Microsoft Gold Partner with nearly 20 years of experience offering integrated, high performance solutions to enhance business objectives. Since 2003, our dedicated consulting team has rolled out more than 350 implementations across 20 countries and 3 continents.