What Every Leader Should Know About Employee Performance

Employee performance is the measurement of how well an employee executes on explicit and implicit standards, goals, and priorities.

“…the measurement of how well an employee executes…”

Employee performance is not binary. An employee’s performance isn’t just good or bad: “Yes, you met the targets,” or “Nope, you missed the goal.” Employee performance falls on a scale with lots of shades of gray. To view performance any other way oversimplifies employee contributions and dismisses real life circumstances.

“…explicit…”

Because employees have different roles and responsibilities, employee performance will look different for each employee. Setting and verbalizing the right goals and expectations is a huge (but not the only!) part of employee performance.  

“…and implicit…”

As much as organizations try to avoid ambiguity, it’s impossible for every element of an employee’s performance to be explicitly stated. Yes, organizations should try to shed as much light on their expectations as possible – transparency is a wonderful ambition. But smart employees and managers also understand the unwritten rules of your organization.

“…standards, goals, and priorities.”

Employee performance is about much more than meeting the numeric goal set at the beginning of the year. Did the employee embody the values of your organization? Was he or she a good teammate? Did the employee work efficiently? Did he or she exhibit strategic thinking or financial savvy? To evaluate performance only on stated, numeric goals ignores all the other ways an employee influenced the organization’s success.

As a concept so critical to organizational success, it’s no surprise that employers are constantly chasing a better understanding and measurement of employee performance. This effort to accurately capture employee performance has spawned about as many measurement techniques as there are unique companies; in other words, there are a lot of different ways to measure employee performance. Different scales, different metrics, different goals. But in the end, it doesn’t really matter.

“But in the end, it doesn’t really matter.”

While measuring employee performance is all well and good, in the end, measurement alone can do nothing to increase performance. Think back to those report cards you got in middle school. Sure, getting an A or F told your parents how you were currently performing in your social studies classes. But those grades couldn’t communicate whether you understood the causes of the Boston Tea Party. Same thing applies here: A measurement-only performance process can tell you the current state of your employees, but can’t do much more than that.

Realizing this, most companies have moved beyond basic performance measurement (strictly goal tracking) and adopted the concept of performance management. Performance management is a process that aims to improve, not just measure, employee performance.

Since the idea of employee performance first entered the collective consciousness, it has evolved quite a lot. Let’s walk through the landmark changes in performance management thinking in the last 200 years.

Performance motivation aims to inspire employees to supercharge their own performance. Wondering how to motivate employees? Through realistic and challenging goals, inspiring recognition, continuous coaching, and frequent conversations about performance.

As you move from performance management to performance motivation, make sure these four elements are a part of your performance strategy.

Describe the Vision with Goals

When it comes to individual success and team alignment, goals are crucial. Goal setting shows employees where they want to go; goal tracking keeps individuals motivated and everyone else informed on the way there. Studies show people who set goals are often more successful than those who don’t. A study conducted by a Harvard MBA program analyzed the success of three student groups: 1) those who wrote down goals with written plans to accomplish them, 2) those who had goals in mind but didn’t write them down, and 3) those who set no goals. After 10 years, the study found:

• Students who had goals in mind earned 2X the amount of students who set no goals.
• Students who wrote down goals with plans to accomplish them earned 10X the amount of the other two groups combined.

You can’t argue with those results. So, if goals are so important to performance, what’s the best way to set and track employee goals? First, let’s start with the basics. For goals to be effective, two elements must be thoughtfully and thoroughly considered.

1. Goal setting: Many people assume they know how to set goals – but setting achievable yet challenging goals is a skill. Discuss possible goals with your employee to understand his or her thoughts on the matter. Examine team and organizational goals to make sure there’s alignment. Decide together what goals will drive improved performance.
2. Goal tracking: Employee goals won’t mean anything if they’re forgotten as soon as they’re set. Make sure you and your employee establish a realistic, consistent process for measuring progress. Tracking progress publicly and in real-time leads to increased transparency and alignment across the organization.

Recognition Best Practices

Employee recognition can include a variety of activities that differ based on the workplace and the individual, and it’s important to find the best fit for your organization. Which employee appreciation ideas will motivate performance? Here are four best practices to follow:

1. Encourage social recognition. Any employee should be able to recognize any other employee, bottom line. The total openness of such a program creates community in your office and increases visibility among teams and departments.
2. Ask employees how they prefer to be recognized. If you’re really looking to motivate employees, do the simple thing: ask them. Each employee is different and so prefers a different form of recognition.
3. Recognize for achievements and behaviors. Many organizations fall into the trap of only recognizing employees for formal goal achievements – but recognition should be given so much more. Recognizing behaviors that match company values reinforces those behaviors.
4. Separate recognition from rewards. Though rewards can work, real recognition (not flimsy plaques or cheap trinkets) is most likely to benefit the organization. Specific, authentic praise for a job well done is an unforgettable and momentous event.

Drive Continuous Performance with Feedback

Feedback – whether from peers, managers, or third parties – stimulates learning and growth processes essential to employee performance. Unfortunately, that doesn’t make giving and receiving feedback any easier. But if your organization is serious about motivating and improving employee performance, it better get comfortable doing the uncomfortable. Without a feedback culture, it’s only a matter of time before your organization stalls.

Types of Feedback

Feedback can come in all shapes and sizes; it’s up to you to decide which type is best for each situation.

Giving Motivating Feedback

We’ve all been on the receiving end of great – and awful – feedback, so we know what a difference giving feedback the “right way” can make. If you only remember five things about giving employee feedback, let it be these five!

1. Give them a heads up. Feedback is more painful when we don’t see it coming. Let the receiver know that you want to give him or her some feedback. Try not to give the receiver so much time that he or she dwells, but enough time that the receiver can mentally prepare.
2. Coach, don’t evaluate. Provide guidance and mentorship, rather than finger pointing and criticism. Remember – you’re on this person’s team! Explain to the person why you want him or her to succeed.
3. Have a conversation. Make sure the conversation goes both ways as opposed to a one-way dump. The recipient should be free to ask follow-up questions, describe the circumstances, and ask for help.
4. Check your language. Avoid using matter-of-fact phrases such as, “You’re too sensitive,” or, “You’re not good at taking constructive feedback.” Instead, use “I” language to share your opinions (but keep in mind that saying things like, “I feel like you’re too sensitive” is cheating).
5. Provide solutions. Explain what you’d like to see. Help the receiver by giving specific steps or a path to improvement. Set goals to monitor and evaluate.

Build Coaching Relationship with One on One Meetings

One on one meetings give employees and managers a dedicated, consistent, and frequent time to discuss employee performance. Not only does this time provide space for growth and development, but it encourages timely problem solving and a forward-thinking mentality (rather than the “review” mindset of an appraisal).

The Best One on One Meetings

Just conducting one on ones doesn’t ensure that they’ll be successful in improving performance; the one on ones have to be conducted effectively. Here are the best practices for a successful one on one meeting:

1. Give one on ones top priority.
   The number one rule for conducting one on one meetings that motivate employees is to make them a top priority. This meeting is another touchpoint for managers to learn about employees, invest in employees’ career goals and development, and show they care about employee concerns.
2. Schedule for consistency; allow for spontaneity.
   In order to be effective, one on one meetings need to happen on a regular and consistent basis. Set a reoccurring meeting for a period that works for you and your employee. Once your schedule is in place, let employees know they can schedule a one on one meeting with you anytime to discuss concerns or opportunities as they arise.
3. Opt for a change of scenery.
   Manager-employee one on ones are all too often held in the manager’s office, creating the manager-talking-at-the-employee dynamic we suggest you avoid. Head to a neutral zone and conduct your meeting over lunch at the employee’s place of choice, a local café, or at the picnic tables outside your building.
4. Stay on topic.
   As difficult as it is to avoid, don’t get sucked into discussing updates on tasks and projects. Use your time together to discuss topics that don’t receive enough love in the office on a day-to-day basis, like team camaraderie, resource constraints or needs, work environment issues, professional development opportunities, and career path. Use our one on one meeting template to guide your conversations.
5. Take detailed notes.
   You should leave each and every one on one meeting with detailed notes. Be sure to track both what was discussed and the tone/mood/body language during the discussion.
6. Don’t make it about you.
   One on ones are about the employee, not the manager. While effective one on one meetings need to be a two-way conversation with dialogue from both the manager and employee, keep the subject matter focused on them. If you do become the topic of conversation, your employee should be discussing what you can do to better coach and develop them.
7. Be a coach.
   Ask the right questions that encourage employees to reflect on their past growth, analyze their current status, and envision their future success. Challenge them to explore ways they can become a more productive and efficient worker and a better teammate and leader. Push them to make commitments and set goals for progress.
8. Leave with actionable next steps.
   Be sure to leave your one on one meetings with a list of actionable next steps. Although you might have scribbled to-dos throughout your notebook, dedicate the last section of your one on one meeting notes for decisions/next steps. Your action steps should directly relate to the items discussed, like finding/organizing new growth opportunities or alleviating employee concerns.

While we see companies left and right dropping the traditional performance appraisal methods, it might not be on the horizon for your organization. The switch to a more engaging and continuous performance management process can be a hard sell and an intimidating process for even the most progressive of organizations.

Luckily, performance appraisals can still be conducted in an engaging and motivating way. If you don’t see your organization scrapping more traditional methods of performance management any time soon, be sure to keep these concepts in mind:

1. Treat employees like individuals.
   This is the overarching rule for a more motivating performance review. While employees in the same field may need the same tools to succeed, each individual’s wants — which drive performance — will be different.
2. Open your door for frequent conversations.
   Just because you’re stuck with the annual review doesn’t mean that’s the only time employees and managers should discuss performance. Encourage employees to raise questions or concerns whenever they have them.
3. Discuss more than checkmarks.
   Yes, the traditional performance appraisal will include a list of overgeneralized goals and numeric ratings. But make your appraisal about more than this: move beyond the obligatory performance review questions and actually have a discussion. Evaluate the “why” behind the metrics and hash out more future-facing topics (such as long-term career vision and skills gaps to be developed). A progressive performance review template can help with that.

If you’ve learned anything from this article so far, let it be that motivating employee performance is far from easy. It can be done – absolutely – but motivating long-term performance improvements is not a one-time initiative. Thankfully, you don’t have to go it alone.

Many organizations turn to some form of HR tech to support them in the journey. The software can go by different names – employee engagement software, performance management system, employee motivation tech – but all the systems should be able to support the four essentials (recognition, goals, feedback, one on ones) that we discussed above.

Here’s a bit more detail on what to look for in a software provider:

Is Quantum Workplace Right for You?

We think it might be. If you’re looking to motivate employee performance in your organization, check out our all-in-one employee engagement software:

Employee performance is essential to the success of your organization, and as we’ve seen, good understanding of and communication with employees drives that performance. Despite traditional thought, improving employee performance isn’t a one-time project or an initiative that you “win” – employee performance is a continuous process of incremental listening, adapting, and improving. It requires deep knowledge of employees and commitment to working with them to motivate performance.

“To win in the marketplace you must first win in the workplace.”

-Douglas Conant, Campbell Soup Company CEO