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Key Performance Management Tools - Everything You Need to Know in 2020

Performance management tools have undergone a radical shift in a short amount of time. In the past, “these tools” were a once-a-year performance review usually done on a paper form. Employees received feedback from their managers, promotions were awarded, and bonuses were given out. However, all that has changed. Why?

  • Performance management tools and software have advanced
  • Employees expect more out of their companies
  • Communication has become vital
  • Workplaces have a more open-door policy
  • Employees become more valuable over time

And even though millions of people are hired each month, a staggering 3.5 million people in the U.S. alone quit their jobs voluntarily each month which is about 2.4 percent of the entire U.S. workforce. So even though you set out to hire the best applicants, if you can’t get the most out of your employees on the job and for them to be fully vested in your culture long-term, it means little.

What are performance management tools and how do they help?

So what can you do? You should invest in and use the latest performance management tools available.Performance management tools can best be explained as measures for evaluating employee performance. These tools help improve business by boosting your bottom line through increased employee performance. Plus, It aligns department goals, employee goals, and organizational goals.

Why use these tools?

If you think you have a tried and true system for performance management, take a look at your employee turnover rate and comments in exit interviews. Because more common than not, your system can be revamped using the latest performance management tools. Some of the reasons to include the latest ones available are:

  • Communication

If you wait until the end of the year to do an employee review, you may have an employee quit unexpectedly and wonder why they left for a competitor. But had you used the latest performance management tools you would have understood why this valuable employee was upset even before they left. And quite possibly you could have avoided their quick exit.

  • Sets and resets goals

When you regularly check in with employees, you may discover their personal goals have shifted over time. Maybe an employee is looking to be trained in a new software for career advancement or they are looking to move into another department. Using performance management tools can help you set new goals for employees. It can also be a time to reset department goals that may need tweaking.

  • Need for increased training

When department goals shift, it may mean a new product must be learned or it could mean a new software introduced. Performance management tools can be used to identify additional training needs. Whether a manager explains what training an employee will be given or an employee requests additional training, this process only strengthens individual growth which will lead to company growth.

  • Feedback

Performance management tools can help with employee feedback that is both positive and negative. If an employee is underperforming, it’s a great opportunity to find out why. Is it something that is easily fixed? If so, it’s worth keeping an employee to avoid the cost of hiring a new one. And positive feedback is also vital. Yes, money is an important factor in motivating employees, but so is recognition for a job well done.

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Best performance management tools to add in 2020

Now that you know how performance management tools can help grow your employees and your company, what tools are available today? Technology and industry advancements are constantly changing so we’ve pulled together the latest and most innovative tools to consider adding to your company. These tools will boost performance and help reach your company goals quicker and more efficiently.

  • Continu - learning management systems

If you are unfamiliar with Learning Management Systems (LMS), they streamline your learning and development program for the entire organization. The alternative is housing your training materials on an Intranet and emailing employees when to take the necessary training. The issue with this is you may have several versions of the same training materials saved. This creates confusion for employees on which version is the most recent. In return, confusion leads to unnecessary emails back and forth between managers and employees. And communication breakdowns begin.

But by using one of the performance management tools Continu, you can house all your training in one central location. Plus, it can be organized by category, making it easy to figure out which training track an employee needs to take and when. And managers have the ability to see which team members have taken which training and who still needs to complete the training. This cuts out unnecessary communication to and from employees and managers.

In order to see how successful your performance management is, you’ll want to track and analyze your key performance indicators or KPIs. KPIs are a measurable value that tell you how effective you are at achieving the objectives you set. This process will keep you on track for reaching overall goals by making metrics traceable so you can easily analyze how they are working. Plus, you can tweak strategies based on your KPIs so you will make sure these goals are met. By investing in a KPI software program, you can further streamline and automate this process. And by automating it, you’ll have a record of how your merics perform over time.

SImpleKPI is an easy-to-use KPI software that should be considered among your performance management tools. It offers everything you need to monitor and visualize your business metrics. Some of the key features include dashboards for real-time monitoring, reports for sharing and collaboration, analysis features for really understanding the causes behind the swings, track individuals, teams and departments, and easy-to-use management tools to keep your data organized.

Like we said earlier, a performance appraisal used to be a one-time year-end regular review. This is where bonuses were awarded and compensation set for the next year. The issue with these former reviews were viewed negatively by employees. Instead of being a “check up” on how employee progress was going, it was viewed as an integration on what employees were doing incorrectly, and focused on past behaviors versus how to make corrections for a better future.

Now, the performance appraisal process has evolved. Gone are the days of a one-time sit down with an employees. Now, feedback and communication is ongoing. Employees and managers regularly check in with each other to discuss performance. And if there are issues, instead of taking termination, additional training is added or a plan is put in place on how to solve the problems at hand.In addition to changes the process, investing in a software like AppraisalSmart is important. It’s an innovative solution to managing employee performance appraisals and reviews. This web-based software Includes things like 360 degree feedback, online job descriptions, and additional ad-hoc appraisal capability that take reviews to the next level. AppraisalSmart makes the performance appraisal process more dynamic and focuses on developing employees versus punishing them for areas of improvement.

  • 15Five - management by objectives

If you are not familiar with management by objectives (MBO) they are objectives that agreed on by both managers and employees. Again this mindset of including employees in the bigger picture goes back to this new shift in performance management. By talking about department goals as a cohesive group, you gain buy-in from employees and a knowledge that everyone knows what it will take to achieve these objectives. In the end, more objectives are met versus missed. And employees feel involved from the start versus an afterthought.

One of these performance management tools is 15Five. They offer a complete employee performance management and team motivation solution. You can create and track individual, department, and company-wide organizational goals and objectives. This software will help advance employee development and achieve set company goals through an online and tractable platform.

Performance management tools will mean little if you don’t have a performance management framework in place. A performance management framework is a plan put in place from when you hire an employee to when they exit the company. The goal is to create an environment that fosters growth both for the employees and the company that is in line with the goals set. The issue is most companies don’t spend the time to create an effective framework and don’t have the performance management tools in place to properly track the progress.

By using a company like Betterworks, you can create a customized performance management framework. They call their approach Continuous Performance Management™ (CPM) which increases employee engagement and drives better results for your business. Some of their key features include BetterWorks is a centralized dashboard where employees, managers, and departments can collaborate to create and work towards measurable, quantifiable goals. It utilizes the S.M.A.R.T (Specific, Measurable, Attainable, Relevant and Time-bound) goals approach and OKRs (Objectives and Key Results). They also offer key integrations with other leading enterprise software so that goals created in their system can be shared.

You may think employees are only motivated by money, but that’s not the case. In fact, a report titled The 7 Key Trends Impacting Today’s Workplace found that money ranked 7th to other factors like a desire to do a job well, feeling encouraged/recognized and personal growth. So if you're still focused on motivating employees through a yearly bonus, there are better ways to get the best out of your workforce.

One of these factors mentioned in this survey was feeling encouraged and recognized so if you don’t put a companywide emphasis on rewards and recognition, now is the time to make the shift to do so. You may think of a reward as cash-based, but really it can be anything from a work-from-home day each week to a trip given to a gift card to a local restaurant.

And if you are not sure how to budget for these sort of rewards as one of your performance management tools, consider using a company like Blueboard. This company specializes in employee rewards and recognition. By using their software, you can set a budget, choose which rewards you want your employees to have, and then have employees choose their rewards directly from their platform.

Performance management tools would not be complete without mentioning the value of coaching.  Hiring a coach for your employees brings a lot of value. This person can help you drive your key points across to your employees. A coach can act as an extension to management. And much like a therapist, a coach can connect with employees on a personal level to find out what is motivating or holding them back. Employees may open up easier to a third party than they would to a direct manager.If you think hiring a coach may be too costly, a great alternative is using coaching software like BetterUp. This software offers virtual coaching. Basically they use evidence-based assessments and machine learning to ensure employees are matched to one of their coaches who is perfect for their individual needs. And since employees can meet their coaches over their computer screens, this performance management tool can be easily incorporated into busy work schedules.

The future of performance management

Performance management is becoming more collaborative and less of a one-time review by management. Since employees expect more out of the companies they work for and managers want to keep valuable team members, performance management tools are vital to future success.

Adding these key tools will help you stay at the forefront of performance management and will help you measure the success of these implemented changes. By getting high performing employees, it will drive both personal growth and that of your company. And when both are functioning well, it will mean better goal achievement and a larger stake in the marketplace.

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