Understanding performance management

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Delve into performance management and get a clear understanding of what it is, the benefits of active performance management and the importance of fairness and consistency.

What is Performance Management?

What is performance management?

Performance management means constantly managing the performance and behaviour of your team members, both good and bad. It is more than just a performance review meeting once a year between an employee and their manager. Effective performance management involves:

  • Setting clear expectations
  • Measuring and monitoring performance
  • Providing regular performance feedback
  • Recognising and rewarding good performance
  • Coaching and helping your team members to develop, learn and grow
  • Managing underperformance
understanding performance management

Benefits of active performance management

When performance is managed consistently with open channels of communication, team members will feel motivated, which can lead to higher levels of performance and output. By having regular performance discussions you can also identify ineffective behaviours immediately and provide a solution before they turn into larger performance management issues.

Importance of fairness and consistency

One extremely important aspect of performance management is that, wherever there are positive consequences (e.g. recognition, praise, rewards etc.) or negative consequences (e.g. negative feedback, warnings etc.) involved, you deal with these situations fairly and consistently. If people believe that they have been unfairly treated, or that others have received special treatment, this can lead them to become disengaged and withdraw effort.

When managing performance ensure that you:

  • Apply the rules fairly and consistently - Every team member should be held to the same standards. If any of your team members underperform or behave poorly, they should be held accountable
  • Distribute recognition and rewards fairly - The efforts of your team members should be recognised and rewarded equitably based on their performance.
  • Explain your decisions - Even though you may have a good reason for applying the rules or distributing rewards in a certain way, without knowledge of those reasons, others may perceive it as unjust and unfair. Providing reasonable and fair explanations can change their perception.

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Next: Setting Expectations