March 16, 2020

Performance Management Tools to Drive Success

Finance Leadership
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Having a motivated and directed workforce is a significant step for a successful business. You can’t function without your people. On average, it costs over $4,000 to hire a new employee. So, it’s in both the interpersonal and financial best interest of a business to prioritise its workforce and overall performance. That’s why performance management and performance management tools are crucial. 

An employee’s performance is not an isolated event. It plays into communication with management, peers, and even with technology. From ancillary tools like automation software to direct performance management tools, here’s how you can help manage your team’s stellar performance, all the time! 

What is Performance Management?

Performance management is a process of alignment between management and employees. It works to help motivate and direct employees to achieve business goals and objectives.

The process involves:

  • Defining expectations
  • Setting objectives
  • Outlining goals
  • Providing feedback
  • Measuring results 

As you can see, performance management isn’t something that needs to be done just once a year. It’s an ongoing process with regular check-ins. Successful performance management relies on clear communication between management and employees. 

Performance management tools help to execute the following. 

Key Performance Indicators and Metrics

Key performance indicators (KPIs) are defined and quantifiable metrics for assessment. They happen at both an organisational and individual level. 

For example, one key performance indicator for an accounting team regarding invoicing could be the time from invoice receipt until payment. Being able to pay vendors on time means that account reconciliation and approvals must occur. Different people may be responsible for each job. To maintain good relationships with vendors and avoid late fees, your accounting team’s goals should be to pay all invoices on time. However, disparate data and bottlenecks could play a detrimental role. 

However, by using automation, you can ensure that invoices are paid on time and are hassle-free. This is because data automation tools, like SolveXia, can ensure data is accurate and invoices are reconciled quickly with live reporting and analysis. 

Automation and Performance Management Tools 

Automation software can significantly help your business with its performance management goals. Some tools may even be able to synchronise and work alongside your chosen performance management tools. 

How can automation software help you? 

There are several ways. Let’s quickly consider what automation tools like SolveXia can do for your business:

  • Enables better performance: It allows employees to use data and automation to their advantage. Processes flow smoothly, and less human errors are made. That way, performance can reach its potential. 
  • Increases employee satisfaction: Because automation tools free up time, employees can now focus on high-level tasks like analytics. This helps to boost employee satisfaction and see the value in their work. 
  • Aids in collaboration: Automation tools like SolveXia are collaborative with safety guard measures in place so that you can define access controls. People from all over can rely on the same trusted data in one centralised location to get work done efficiently and accurately. 
  • Increase transparency: With processes automated, the software enables management teams to have greater clarity regarding business processes. This is a massive aid in performance management. It makes it easy to see where there are flaws with the system or process, rather than blaming an error on an employee. 
  • Streamlines processes: With automation tools, you can say goodbye to bottlenecks and critical person dependencies. The system can send necessary reports for approval to those who need them and provides real-time dashboards and analytics for better decision-making. 
  • Boosts customer satisfaction: When businesses can optimise their processes with the aid of automation tools, everyone within the business benefits. But, perhaps most importantly, customers reap the satisfaction of quicker response times, fewer errors, increased loyalty and trust, and ultimately, better customer experience overall. 

The Art of Goal Setting

At the start of the year, quarter or upon hiring a new employee, the employee and manager should sit together and define clear goals. Consider setting SMART goals that are - Specific, Measurable, Achievable, Relevant and Time-Bound. Performance management tools can help you identify and lock in goals. That way, employees and management can continue to check back in and see that current work is on the path to achieving such defined goals. 

Time for a Performance Review

It’s easy to get bogged down in the daily functions of work. It can even become a challenge to find enough time for performance reviews. However, a performance review is a crucial step in performance management. Like the name implies, a performance review consists of going over an employee’s work and assessing if goals have been met. Instead of just annual performance reviews, many organisations are moving towards a system that incorporates personal appraisals. 

Personal Appraisals

Personal appraisals provide more frequent feedback for employees. They can happen weekly, monthly or quarterly. Performance management tools can help keep these organised and stored so that both employees and management can track performance over time. 

360 Degree Feedback

Like automation tools, performance management tools are collaborative. Some tools allow for feedback to come from the entire organisation, including peers. Rather than just a top-down approach to feedback from management to employee, everyone can provide insight into the inner workings of a business and its people. 

Competency Management and Skill Assessment

Some positions have stricter requirements and necessary skills than others. Performance management tools can help track licensures and certification to keep up with rules and regulations. This is especially important when it comes to industries like finance or healthcare. The ability for technology to lower compliance risk is a great benefit these days. 

Development Planning

Employees generally appreciate a plan or roadmap for how they will be able to grow with your business. This is also a part of performance management. Tools can help outline the future and provide career planning maps for your team. 

Performance and Productivity Analytics

Are current business processes working, or is there a need for process improvement? By utilising productivity analytics, managers and business leaders can measure outputs. 

Management by Objectives

Management by objectives (MOB) is like drawing a game plan according to how you want to score the shot. It means that management defines objectives and then sets out the plan on how to achieve each objective. It’s a reliable way to get everyone aligned with accomplishing shared goals. 

Performance Management Frameworks

There are performance management frameworks that are designed to define and monitor performance. The Balance Scorecard (BSC) was developed by the Harvard Business Review and helped businesses to do the following:

  • Clarify and communicate business strategies and goals
  • Monitor progress and track when goals are accomplished 
  • Define action plans to ensure that the company can reach its goals 

Reward and Recognition Programmes

Everyone loves incentives and rewards for a job well done. When employees are rewarded for good work, a company culture of motivated employees develops. Whether you decide to offer bonuses or only verbal recognition, a little bit can go a long way. 

Personal Development Plans

Personal development plans (PDPs) are tailored roadmaps for individual employees to set out future goals and performance measures. They may involve outlining what type of training courses are needed or the type of support they need for success. PDPs help to breed a company-wide culture that is geared towards high achievement. 


What is a Performance Management System?

A performance management system is a tool to help track employees’ work overtime. Successful leaders use performance management systems to communicate department-wide and ensure that everyone is on track to achieve organisational goals. 

Benefits of a Performance Management System

Performance management systems are useful to organisations in all industries. They help to take the strategies mentioned above and elements and organise them in one place. The benefits include: 

  • Enabling continuous performance management 
  • Increasing the frequency of feedback 
  • Ensuring fairness
  • Identifying training needs
  • Automating review processing 

Top Features of Performance Management Systems 

If you’re considering implementing a performance management system in your business, these are the top features to make sure are included: 

  • Past performance: The ability to build historical data and previous feedback so managers can track growth and improvement. 
  • Feedback mechanisms: A way to capture 360-degree feedback. 
  • Rating system: An established rating and scoring system so that businesses can customise how they rate and review employees.
  • Development plans: Both managers and employees should have the ability to outline their development plans and future goals.  

Performance Management Systems: By the Numbers 

The proof is in the numbers that performance management is a key to better business. Here are a few key statistics:

  • Managers who receive feedback on their work show 8.9% boosts in profitability 
  • Companies who provide regular employee feedback have 14.9% lower turnover when compared to companies without feedback
  • 69% of employees would work harder if they received any sort of recognition or praise
  • 92% of respondents believe that negative, but constructive feedback can lead to improved performance 

The Bottom Line

Both performance management tools and automation software can play a pivotal role in enhancing your business’ operations. When employees have a clear direction, technology on their side, and consistent reviews from their managers, they are more motivated to work towards their goals. Automation tools such as SolveXia can assist in helping promote both employee and customer satisfaction through smoother workflows

While it’s not always easy to focus on the small details on business, as well as leave time for the bigger picture, it’s paramount to give the right amount of attention and care to your human resources. After all, it is the people within your organisation who keep it running day in and day out. 

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