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Performance Management – Part 3: Increasing Fairness in Your Process

Posted by Yen Phuong Nguyen on

Not many organisations are willing to invest in a performance management system; various small to mid-sized businesses choose to ignore it altogether. Technology-enabled performance management if not implemented correctly tends to fail miserably.

Increasing Fairness in Performance Management Process

One of the many root causes of such failure is mistrust due to unfairness. The mistrust, in turn, can lead to employees turning their backs to the organisation, a tighter control over the business processes, and rows and rows of written documentation which could over-complicating everything and does not yield any real values.

Read more: Part 1 & Part 2 of the series 

Increasing fairness in your organisation’s performance management process

The first question that managers need to address is whether the organisation already has a clear definition of “what is fairness?” A clear definition acts as a foundation that the employees’ perception can base on.

Each of your staff will have their own rendition of fairness. In order to “standardise” the concept on the organisational level, your performance management system needs to satisfy a list of criteria.

Align the employee’s personal goals with business goals

In order to gain trust, your expectation about the employees’ performance needs to be clear. Paint the big picture that the organisation is trying to achieve and how their role fits into the picture.

Infographic: The power of expectation

Allow your employee to be involved in the goal making process. Forcing the targets and KPIs from the top management down can backfire; your staff may feel demotivated, and they may disengage in their daily work.

As time goes by, the business goals will change to meet up with the demands of the current market and so does your employee’s goal. Thus, revisit the goals throughout the year, not just once at the year-end period. This prevents any effort go unnoticed or meaningless targets which can cause the employees to lose trust.

Read more: KPIs - the key to identifying your top performers

Managers can be trained to become coaches

Managers are the ones that interact with the employees on a daily basis, therefore, they fully aware of the capabilities and the development needs of their employees. They can match the employees’ capabilities with the current business target to motivate them or readjust if the goals are out of reach.

As a coach/ manager, they give frequent feedback or review if the employees have shown poor performance, or need some motivation to keep their spirits up. However, many managers lack the leadership skills to conduct meaningful performance conversion, consequently, they act awkwardly during uncomfortable situations.

As a result, whether a company’s performance management process is effective or not, the majority of pressure lies on these managers. Developing the managers to become coaches can help assist your employees further and they can also act as the employee’s representative during the much needed time.

Read more: 5 principles of effective organisational coaching

Reward your employees accordingly

It is common to motivate and recognise your staff through compensation or rewards. The question is: how to benchmark your reward for each individual fairly without causing any commotion?

You may be able to pick out the very top performers and distinguish them from the poorly performing ones. However, the middle-range performers also need the attention. It is risky for companies to have too gaping compensation policies as many will see this as unfair.

Read more: Motivation - How does it work for sales?

Cirque de Soleil has an effective resolution to combat this issue. Every Cirque de Soleil performer is guaranteed a base salary which is annually adjusted to match with the market rates. Their pay is consistent, and the differences among employees are usually small. As such, the unfairness is avoided. And for their middle-range performers, Cirque de Soleil rewards them with more than just mere monetary incentives. They are given explicit praise, personal coaching or special assignments.

Spot bonuses for great effort or outstanding contribution during the year is also an effective way to avoid inflating the company’s salary scheme and to show your employees that the system is responsive.

Thinking of improving your company’s performance management system? Let’s TRG Talent help you! Our solutions can help you to effectively identify the high performers, acquire insights into their interests, behaviours and thinking styles in order to motivate and develop them fully.

Furthermore, these insights are useful for individuals as well as for your entire team and can be used to measure the differences between each member, thus, increase their level of engagement and productivity.

To find out more about our Talent Management solutions, visit our website or request a demo today!

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Topics: Talent Management

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 Rick Yvanovich
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