What’s the Best Way to Measure Employee Performance?
This piece is originally published in the latest edition of Performance Magazine. Here is the response of Alina Miertou, a Senior Management Consultant at The KPI Institute, to the question “What’s the Best Way to Measure Employee Performance?”
I wouldn’t say there is a “best way to measure employee performance management given that performance management practices should be customized for the context they’re being implemented.
However, we can still see the traditional approach in employee performance management based on bi-annually appraisals of the KPIs, behaviors and skills, and competencies in numerous organizations. Clearly, there has been a trend developed in the past few years, and this is abandoning the traditional performance appraisals in favor of recurrent feedback and more informal check-ins.
One of the reasons for the change we see in employee performance management comes directly from the employees, with the workforce dominated by millennials. The management style is forced to accommodate their expectations, such as participation, flexibility, creativity or focus on creating an impact through their jobs. A study done by PWC in 2011 stated: “Millennials tend to be uncomfortable with rigid corporate structures and turned off by information silos. They expect rapid progression, a varied and interesting career and constant feedback.”
The second most important reason comes from the business needs. In a world full of information that is changing rapidly and facing a growing employee retention issue (for example, all the organizations I have worked with this year had at least one objective regarding retention and improving their brand as an employer), we can no longer afford to base our employee performance management on punishing or rewarding past behavior or past performance.
We are challenged to always be on the lookout for ways to improve performance and grow the talent pool available in the organization. A growing number of organizations (around more than a third of US companies) are choosing a less rigid and more frequent performance review rather than a formal appraisal score.
Alina Miertou facilitates the Certified OKR Professional Live Online Course of The KPI Institute. The course is designed for professionals who want to understand how to deploy and use OKRs. Some of the learning objectives are to distinguish objectives, key results, and initiatives; identify the different types of OKRs; and determine the advantages of stretched goals. Learn more about the course and its schedule in the following months here.