Five ways performance management can help to raise productivity

How does your organisation assess the productivity of its people? Are there formal targets that people need to meet or is it a more informal affair, and left to individual managers to decide whether their people are doing as much as they possibly could?

Recent research from the CIPD suggests that productivity is an issue organisations are pretty complacent about. In its latest Labour Market Outlook survey, the vast majority of employers (88 per cent) said their organisation’s productivity is average or above average relative to their peers. This is despite the fact that 40 per cent of employers say they are not actually measuring productivity at all!

Evidence from the ONS (Office for National Statistics) suggests this is a dangerous attitude. Latest figures indicate that productivity rates – which took a hit after the financial crisis – are continuing to worsen, with output per hour on the decline.

Performance reviews – and in particular a focus on managing under-performance – are identified by the ONS as one of the most effective ways to improve productivity. So, what can organisations do to make sure the performance review process has a real impact on individual and corporate productivity?

1. Focus on strengths-based performance management

There’s a body of evidence to suggest that focusing on people’s strengths is a far more effective way of raising performance than trying to ‘fix’ their weaknesses. That’s not to say that critical skills gaps should be ignored, but looking at what people are really good at and finding ways for them to do more of it will help managers raise the performance bar. Performance reviews provide a great forum for finding out what lights people’s eyes up, how you can capitalise on their strengths and how their responsibilities might be adjusted so that they are able to play to their strengths. It’s also a great opportunity to find out what’s really getting in the way of people achieving as much as they could – and to talk through what changes would give them the headspace to concentrate on the important stuff.

2. Train managers in the art of (performance) conversations

There’s a tendency to assume that if people have reached the heady heights of management, they must be capable of holding good quality conversations with their people. As anyone who has been on the end of a woolly, demotivating appraisal will tell you, this isn’t always the case. Managers often simply don’t know how to help their people get better – and frequently sweep poor performance under the carpet, because it’s the easy thing to do. If organisations want to up the ante on productivity, they need to equip managers with the knowledge and skills to conduct open and honest appraisals, where both parties come away clear about what’s expected, what needs to be achieved and excited about future challenges.

3. Develop ‘connector managers’

Recent research from Gartner says that ‘connector managers’ (those who focus on connecting their employees with the right people at the right time) typically have the highest performing teams. The depth and quality of a manager’s network, however, is not an issue that often comes up in their own appraisal conversations. Managers need to be encouraged to think widely about who in the business (or indeed outside it) is best placed to help their people achieve their objectives, rather than assuming they have to come up with all the answers themselves. HR can create a platform for conversations about who can remove barriers and speed up progress, who has previous experience employees can draw on and who can quickly help them develop new skills.

4. Ensure feedback is timely

People’s productivity is unlikely to improve if they have to wait six months or a year to find out what they could be doing better or differently. The most effective feedback is in the moment (or as near to it as is possible). HR practitioners have a role to play in encouraging a culture of continual feedback so that people can be clear about exactly what is expected and can learn quickly from mistakes or build on successful approaches.

5. Focus on working smarter, not harder

As Dropbox’s Adrienne Gormley says in a recent HRD Connect article, if organisations want to make a real difference to productivity, they need to look at how to reduce the amount of “work we do to manage our actual work”. Cloud HR systems, such as Cezanne HR, allow HR teams to quickly and easily digitise HR data and processes, cutting down admin overheads and removing friction across a host of different processes – from onboarding to performance reviews.

Obviously, raising productivity isn’t just about the people. There are a host of factors that contribute to how well organisations perform. However, by starting with employee performance, HR can create a forum to talk about what’s getting in the way of doing great work – input that can be used to drive and inform other changes across the business.

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