How to Implement Continuous Performance Management

What is continuous performance management?

Continuous performance management is the future of performance management. It eschews annual performance reviews in favor of more frequent informal check-ins. The process focuses on motivating employees to have a growth mindset, fostering improved communication and coaching, and celebrating positive actions and results.

There are many elements to continuous performance management, such as:

• Consistently identifying and fixing gaps in employee skills or competency: By continually monitoring employee performance, managers quickly become aware of areas that need improvement. They can then institute additional training or coaching to address these gaps in a timely manner.
• Giving frequent, specific, actionable feedback: With an annual review, much of an employee’s performance, both good and bad, can be forgotten. With continuous performance management, good qualities and outcomes can be immediately recognized. Plus, bad ones can be pointed out and corrected before bad habits are formed.
• Instituting a high-performance culture: Employees know what is expected of them; managers can act as coaches and mentors. They can support their staff in achieving success rather than being distant supervisors whose expectations are subject to speculation.
• Increasing employee agency and engagement: With clear expectations, the necessary training and frequent support from management, employees are freer to take initiative. They can be creative and come up with solutions to meet their work goals.
• Having clear, articulated goals: These types of goals put employees and managers on the same page. Employees know specifically what they need to achieve, so they’ll have less anxiety about how to meet manager expectations.
• Creating less biased employee evaluations: With input not only from the supervisor but also from peers at multiple points, work evaluations are more fair.

Adrian Wade, head of supply chain at BlueSky Solutions, said that his company uses continuous performance management, which has proven to be successful.

“By directly involving employees in this way, they are given ownership of their own progress,” Wade told business.com. “It also allows managers to identify any possible issues early and find solutions before they escalate into bigger problems. This combination of personal accountability and ongoing support is what is really key for successful, continuous employee development.”

How to implement continuous performance management

Continuous performance management incorporates real-time feedback. While doing so, it allocates short-term objectives and encourages frequent developmental conversations with all employees. The practice removes the anxiety of annual performance reviews and other employee-manager interactions.

This method is more effective in getting employee buy-in and helps managers create better performance improvement plans in the workplace.

Follow these six steps to transition to continuous performance management:

1. Talk to managers to discover who is already conducting regular performance discussions.

Having difficulty getting managers to conduct yearly performance reviews with their employees? Then you might feel that continuous performance management is impossible. After all, if managers aren’t motivated to conduct one review, how will you inspire them to hold at least 12?

Your first step is to talk with managers and leaders in your organization to discover how many already carry out informal performance discussions. You might be surprised. Many companies that have introduced continuous performance management found that managers had already incorporated regular informal feedback check-ins to a certain degree.

Managers should be intimately involved in designing your new process and transitioning to continuous performance management. Ask them how they organize formal and informal meetings, how frequently these meetings happen, and whether they have any helpful talking points to get the ball rolling.

2. Get buy-in from senior leadership on continuous performance management.

To successfully implement a new continuous performance management system, you must get buy-in from top management. It’s easier to get the rest of your workforce on board when they see the higher-ups leading by example.

It’s normal to face some resistance from senior leadership regarding an organizational change — particularly one as big as ditching annual appraisals. Take the time to discuss, using research-based evidence, the business benefits of continuous performance management.

Answer questions regarding how the new process will identify high- and low-performing employees. Also divulge how promotions, merit pay increases and employee bonuses will be handled. Knowing that these questions have been considered and are being handled can give leadership a level of confidence in the new system.

3. Sell the benefits of continuous performance management to managers.

No manager will be truly engaged with the new system if they don’t understand its value and how it will improve performance. For this reason, HR must explain the new system in detail; the explanation should include why you’re transitioning to continuous performance management and how it will help everyone improve.

Stress the benefits of a more engaged, motivated and better-performing team to managers. They should also know that, ultimately, regular check-ins are less time-consuming than an arduous annual appraisal process.

4. Provide the necessary training and guidance for continuous performance management.

To get the most out of your new performance management system, provide the appropriate training. Use the time normally spent administering annual appraisals to train managers to conduct quality performance conversations and deliver meaningful feedback. Don’t assume this comes naturally to all managers.

5. Continually communicate the changes that will take place.

Employees and managers may need several explanations and multiple discussions about the switch to continuous performance management. Communication planning is critical when an organization is transitioning to continuous performance management because everyone must be on board.

Don’t rely on a one-off email announcing the change. Organize various methods to communicate the transition, including email newsletters, videos, face-to-face meetings, webinars and fact sheets.

6. Use continuous performance management software.

Technology is an incredible tool for facilitating your transition to continuous performance management. Top-rated HR software can help you schedule and track one-on-one meetings with employees, exchange real-time feedback, and track SMART goals and objectives that will be revisited regularly.

With performance management software, you can track performance discussions and feedback sessions while monitoring pressing performance issues. Such employee data is crucial for monitoring the success of your new performance management process.

Craig Goodliffe, CEO and founder of Cyberbacker, said that his company implements continuous performance management through KPI tracking.

“We have a scoreboard,” he said. “Every week we measure KPIs as a company, and we identify who’s making improvements and who’s not. It tells us where we need to spend our time because we’re behind.”

Benefits of continuous performance management

Continuous performance management brings many benefits to employers and employees, including the following:

• Boosts employee engagement: It’s no secret that you get your best work from engaged employees. Continuous performance management can help with this vital metric. According to research from Gallup, employees who had conversations with managers about their goals and successes in the previous six months were 2.8 times as likely to be engaged in their work.
• Nurtures trust: By continually interacting with employees and giving them feedback, managers show they’re genuinely interested in helping each employee succeed. Frequent communication empowers and encourages your staff and improves manager and employee relationships.
• Provides vital data: In the Gallup survey, nearly one-quarter of employees found their manager’s feedback to be meaningful. Managers should demonstrate expectations and create actionable goals that team members can follow to succeed. Continuous performance management systems give employees a rubric to work from consistently while encouraging feedback. That way, if something isn’t working, it can be adjusted easily.
• Helps employees succeed: Employees get consistent updates on their performance and management’s expectations. If they’re not excelling as quickly as they’d like, continuous performance management brings real-time feedback that can help. Struggling employees can get actionable tips on how to improve instead of checking in once a year to learn how they’ve failed.
• Improves employee retention: When employees feel valued and more engaged with their employer, their job satisfaction improves. Because they are happy at work, they are less likely to look for another job — thereby reducing the company’s need to recruit, interview and train new employees.