Skip main navigation

Top tips for performance management

Many business leaders are realising that they aren’t getting value from all the time they spend on performance management. What's all the hype?
A manager helps a member of their team with their work on a laptop
© CIPD

What is performance management?

At the CIPD we define performance management as the set of processes that aim to maintain and improve employee performance. The aim is to ensure that all employees contribute positively to business objectives.

As a manager it is your responsibility to lead these activities for your team and manage their performance and development. This will enable employees to be more productive and continuously improve their performance.

Organisations will each have their own framework for performance management. These frameworks will usually include some or all of the following activities:

  • Setting individual ‘SMART’ objectives
  • Regular performance feedback and coaching
  • Learning and development opportunities to support the growth of individuals and teams
  • Formal reviews or appraisals annually, bi-annually or quarterly
  • Performance ratings which may be linked to additional reward or bonuses

The aim of these frameworks and activities is to support managers to deliver what the organisation needs to be successful. This success will be achieved through the efforts of your team.

What’s the hype?

There is a lot of hype about performance management at the moment. Many business leaders are realising that they aren’t getting value from all the time and effort that they spend on these processes.

Think about how much time you currently spend on performance management as a manager.

Deloitte, a worldwide professional services company, calculated that they spent almost 2 million hours a year creating their annual performance ratings. As a manager you want to make the most of the time you and your team spend on these activities. You want to create a high performance culture where people are clear about their contribution to the success of the organisation. In these cultures, performance management helps employees to grow and develop.

Here are 5 practical steps to help you get started.

1. Set clear expectations

It is important that everyone in your team is clear about what is expected of them in their role. They should also understand how their role contributes to the success of the organisation. This could be explained in a job description, as an objective or even a bullet point list.

Start by having a conversation with your employees about their priorities. How are they going to achieve them with your support? Don’t forget, as business priorities change throughout the year, these priorities are also likely to change. It will be impossible to review any individual performance successfully if you haven’t first agreed a set of expectations.

Ideally we want our employees to feel they have a purpose that is aligned with the organisation’s. We want them to feel fulfilled in the work they do.

2. Have regular conversations

Take a moment to think about how often great sports people or teams are coached and receive feedback.
Your role as a line manager is to continually coach and develop your team to check if they are on track and how you can help. Regular feedback is essential for anyone to improve at anything. Employees need to understand what they are doing well and where they need to improve. These two factors will help them understand what to keep doing and which areas they need grow and develop in.
You won’t be surprised to learn that having one quick conversation with an individual once a year isn’t going to encourage high performance!

3. Grow and develop your team

There are many ways that you can help support the growth and development of your team. Developing your people means much more than sending them on a training course. There are so many options available. For example, think about all the bite-size learning accessible online, like this course!
Think about the different individuals in your team. Where do their strengths lie? What stage are they at in their career? What is their reason for working? Can you pair experienced and less experienced members of the team? Do they need to be stretched by contributing to a new project? Or given additional responsibilities? Would they benefit from external influences such as a secondment to another team? Would they enjoy having a mentor or attending conferences? Is there somebody in the team you could develop into your successor?
We are all responsible for our own career and development but your guidance as a line manager is vital to help your team find the right path.

4. Have difficult conversations

A line manager’s role isn’t easy and just as we are human, individuals in our team are human too. Individuals may have times when they are performing well and others when they are not. This could be happening for a variety of reasons both work and personal. We might notice they are late or absent from work. They may not be getting on with team members. Perhaps they are late completing work milestones. Or maybe their standard of work has dropped.
As soon as you notice anything it is important to check in with the individual. This way, you can start working together to tackle the issue and to minimise the impact on them and the rest of the team. It can be as simple as an afternoon of unpaid leave or extra help with new technology. As a manager you must act in a fair and consistent manner with all of the team, appreciating the richness of their individual differences.
What do you think the impact will be on overall team performance if you don’t tackle an individual case of under-performance?

5. Prepare for the end of year review

Many organisations have an end of year review or appraisal as part of their performance management. If you have successfully completed the earlier steps this should be a straight forward conversation. There should be no surprises for you or the individuals in your team. This is an opportunity for you to thank the team for what they have contributed during the year. You can pick up on their key achievements and agree where they need to develop for the future.
It should be a positive and motivating conversation for the individual. They should feel proud of what they have achieved as a result of your support. You can prepare by reviewing notes from previous coaching conversations. This covers any development activities or issues that have come up during the year. If you haven’t done so already, this is also an opportunity to gather feedback from other stakeholders that your team may have worked with.
A common part of this year-end process is to allocate a rating to each individual. Many managers will want to be seen as a ‘good manager’ by their team so can struggle to be honest here. This is particularly true if bonuses are dependent on ratings. Commonly, they may opt for the middle as an easy option.
What do you think the short and long term impact of doing this could be, on yourself, the individual and the team?

In summary, many of these performance management activities and behaviours will be natural to some managers. For others, formal processes will help to keep on track and to practice the skills required to manage their teams.

Try not to see performance management as an extra management duty. Instead, think of it as something to help you do your job. Effective performance management is integral to your role as a manager and will help you achieve the goals of your organisation.

© CIPD
This article is from the free online

People Management Skills

Created by
FutureLearn - Learning For Life

Our purpose is to transform access to education.

We offer a diverse selection of courses from leading universities and cultural institutions from around the world. These are delivered one step at a time, and are accessible on mobile, tablet and desktop, so you can fit learning around your life.

We believe learning should be an enjoyable, social experience, so our courses offer the opportunity to discuss what you’re learning with others as you go, helping you make fresh discoveries and form new ideas.
You can unlock new opportunities with unlimited access to hundreds of online short courses for a year by subscribing to our Unlimited package. Build your knowledge with top universities and organisations.

Learn more about how FutureLearn is transforming access to education