According to a number of industry surveys, many employers are eager to upgrade their performance management systems. They’ve concluded that their existing systems—which often revolve heavily around annual performance reviews—are both laborious and largely ineffective.
In contrast, the best performance management systems are actively inspiring employees to perform at higher levels. How do they do it? By providing workers with an ongoing stream of personalized feedback, coaching and recognition, while inviting workers to contribute input. These more collaborative systems enhance employee engagement, while offering year-round opportunities for skill development.
Despite offering increased benefits, advanced performance management software is simultaneously streamlining the workflow for busy HR professionals and field managers. That’s significant! According to a recent survey of more than 350 CHROs, 85% were committed to simplifying their performance management process.
So what should employers look for when evaluating performance management software, which may be part of a new human capital management system? They can start by focusing on the following six key components.
1. An Automated, Streamlined Performance Review Process
While some employers are eliminating annual performance reviews, many see value in them—provided the process is simplified and supported by additional performance management tools.
An automated performance review process vastly reduces the amount of time spent preparing, routing and re-routing documents. To accomplish this, the best performance management systems give employers timesaving tools, including:
- Customizable performance review templates and job descriptions
- E-signature capabilities
- Automatic notifications/reminders that keep the process moving
- Employee self-evaluations
Another benefit of automating the entire performance review workflow is that it creates consistency throughout an organization, ensuring employees at every level and location are following the same process.
2. A Comprehensive 360-Degree Feedback Program
360-degree feedback—performance-related input collected from an employee’s coworkers, direct reports, vendors and/or customers—is an important component of holistic performance reviews.
The best performance management systems make it easy to collect and collate 360-degree feedback. They allow HR professionals to draw from expertly-prepared survey questions as well as create their own. They’ll send status updates to keep all parties on point—and best of all, once all data is submitted, generate a summary report that offers valuable information to both employees and managers.
3. Goalsetting and Goal Management Capabilities
Do your employees know what you expect of them? Do they know where they fit in with the company’s goals? Don’t make assumptions. According to a Gallup poll of more than two million workers, only 50% reported knowing what their employers’ expectations of them were, let alone the bigger picture.
For this reason, the best performance management software provides clear goalsetting and tracking capabilities. It allows organizations to set and communicate goals for individual employees and departments—as well as company-wide—while providing tools for tracking progress at every level.
4. Easy, Anytime Journaling Capabilities
More managers are holding informal performance-related “check-ins” with employees on a regular basis. It’s important to capture key talking points of those discussions as they occur.
As a result, the best performance management systems allow managers to enter performance-related notes with minimal fuss at any time, while uploading relevant attachments to individual files.
Not only does this truly contribute to performance development, it creates a more accurate picture of an employee’s year-round activity as it occurs, making annual reviews more complete.
5. A Compensation Translator
The vast majority of employer’s link performance to compensation—a move that’s been proven to be effective. Yet, perplexingly, not all performance management software (or human capital management systems, for that matter) makes this connection. This creates more work for HR and payroll and at worst, can create inequities across organizations.
The best performance management systems, however, include a compensation translator (also called a dashboard) that can automatically weigh an employee’s pay grade, performance review rating, etc. and provide automated compensation recommendations.
Not only can this speed to the pay raise approval process (a surefire crowd-pleaser), it ensures consistent compensation methodologies are followed throughout the company.
6. A Portal to Online Learning Content
Offering opportunities for skill development is one of the best ways employers can inspire employees to higher levels of performance, while preparing in-house talent for advancement within the company.
That’s why the best performance management systems don’t just allow employers to upload their own training media for employee consumption, they provide access to outside libraries of online courses and learning content.
In doing so, employers demonstrate that they are eager to invest in their employees’ skill development and growth. It gives employees a viable reason to stay with the employer, while offering a path to career advancement. Since some industry experts are suggesting “performance management” be relabeled “performance development,” it’s a great step in the right direction.
Learn about EPAY Systems' Performance Management Solution
If you’re looking for the best performance management software for you hourly workforce, you owe it to yourself to learn about EPAY’s human capital management system. Our performance management solution includes all the crucial elements described above. In addition, our HCM system is designed to simplify the HR workflow, while giving employers powerful tools that optimize the hourly workforce. Learn more: schedule your personalized demo.