What is Agile or Continuous Performance Management?
Performance management is one of the most critical aspects of people management. Modern organizations worldwide have recognized the inherent shortcomings of traditional, annual appraisal-based performance management. Given the considerable investment of time and resources involved, this approach is no longer sustainable. As a result, organizations are embracing agile or continuous performance management as an alternative. This shift aims to enhance employee engagement and cultivate a culture of high performance.
What is Agile or Continuous Performance Management?
Agile or continuous performance management is the future of performance management. As its name implies, it is a continuous process that happens throughout the year, comprising goal-setting aligned to business priorities, ongoing feedback and check-in meetings for employee coaching, and periodic reviews for analyzing employee progress. Unlike conventional performance management, which relies on yearly appraisals, this strategy embodies a comprehensive and ongoing process.
When seen as a continuous process, performance management becomes less burdensome and more effective in achieving its intended purpose. Its focus lies in nurturing a growth mindset among employees, enhancing communication, and recognizing positive actions and outcomes. By embracing real-time feedback and promoting frequent career discussions, this method eliminates the apprehensions associated with annual reviews and other interactions between employees and managers. This not only ensures employee engagement but also empowers managers to formulate more effective performance enhancement plans for their teams.
Benefits of Agile Performance Management
Agile performance management is more about employee growth and development than an organizational exercise. It is about cultivating a culture where people are comfortable giving feedback across the organization and is dedicated to unlocking the full potential of both individuals and the organization as a whole.
Agile performance management brings many benefits to employers and employees, including the following:
- Stronger organizational alignment: Unlike traditional yearly goal-setting, agile performance management focuses not only on long-term strategic goals but also on short-term tactical objectives, making them more achievable and flexible. This flexibility enables easy adjustments to changes in business priorities in response to unforeseen circumstances.
- Increased employee engagement: Engaged employees yield superior results, and agile performance management plays an important role in driving this engagement. According to Gallup research, employees engaged in conversations with their managers about their accomplishments and objectives were 2.8 times more likely to feel engaged in their tasks. Additionally, when employees receive regular feedback from their managers, their engagement level triples.
- Enhanced employee-manager trust: Through regular feedback and check-in meetings, managers demonstrate a genuine commitment to each employee’s success. Frequent communication empowers the workforce and improves manager-employee relationships.
- Better employee retention: A sense of value and increased engagement with the employer lead to better job satisfaction among employees. This elevated job satisfaction translates to reduced attrition rates, as content employees are less inclined to seek alternative employment. Consequently, the need for new employee recruitment, interviews, and training diminishes, thereby positively impacting the organization’s resources and efficiency.
Implementing Agile Performance Management
Implementing agile performance management first of all requires executive buy-in. After years of following traditional performance review processes, executives may not understand the importance of agile performance management. If senior leadership does not actively participate in the performance management process, or take responsibility for it, managers and employees will doubt its value.
Additionally, managers need to be trained to conduct meaningful and engaging conversations. It wouldn’t be right to assume that all managers are equipped to do this naturally. According to a McKinsey study, 74% of employees believe the effectiveness of performance management is directly linked to their manager’s ability to give feedback and coaching. When managers lack the skills to coach effectively, the investment in performance will go waste. Also, to set goals and objectives, measure progress, and improve performance, managers have to create them in a more agile and collaborative way, give people lots of feedback, and coach them to succeed.
Leveraging Technology
Utilizing the right technology can serve as an invaluable partner in seamlessly executing your performance management strategy. It is also an incredible tool for facilitating the transition to agile performance management and streamlining various processes. Software solutions like Peptrics can seamlessly organize and facilitate check-in meetings and real-time feedback exchange, and oversee the progress of goals and objectives.
Performance management software empowers leaders to keep track of performance discussions and feedback while simultaneously addressing critical performance concerns. This data becomes instrumental in evaluating the efficacy of the new performance management approach. To be truly effective, the agile performance management process necessitates collaboration, frequency, and real-time interaction, departing from retrospective assessments. Monitoring the process’s efficiency is equally vital, and agile performance management software aids in achieving this by enabling:
- Timely feedback: Facilitating prompt feedback delivery, avoiding the delay until the next scheduled interaction.
- Action item tracking: Capturing action items from check-in meetings for follow-up, preventing them from getting lost or forgotten.
- Collaborative goal setting: Allowing collaborative goal setting that aligns with overarching organizational goals.
- Visibility of check-in meetings: Providing people leaders with insight into the frequency of check-ins and feedback across the organization.
- Data collation: Empowering people leaders to gather performance and talent data without the need for formal performance appraisals.
Even though adopting agile performance management requires commitment and effective communication strategies, the potential benefits for employee engagement and organizational success are substantial. Agile performance management when implemented successfully can enable organizations to stay competitive in times of uncertainty and build a high-performance culture. Peptrics’ Align-Assess-Coach framework is an easy-to-implement agile performance management process that empowers organizations to make the transition with minimal effort. Sign up for a free account to overhaul your performance management system today!
