What Are The Latest Trends in Performance Management?

2018 was a year of a major evolution in performance management. Organizations across all business sectors shifted from traditional HR practices of annual appraisals to simpler and effective performance management system that is ongoing throughout the year. 

Year 2019-2020 highlighted five new performance management trends that the organisations are focusing in upcoming year:

1. Employee Well being

As Josh Bersin has stated, well being is still a big part of HR. Productivity is suffering when stress level are high; employees feel overwhelmed and they’re getting less work done. Detecting and addressing mental issues early on is becoming important. Organizations such as Cydesdale and Yorkshire Banking Group have begun including wellbeing questions within their regular manager and employee coaching conversations in order to spot and address potential mental health and workplace stress issues.

Deloitte’s 2018 Global Human Capital Trends reports emphasized on the need for organizations to be social enterprise rather than simply business enterprise. Even the employees are now becoming more vocal when it comes to well being. Care for employee mental health and well ­being will be one of the biggest performance management trends to watch out for, with employers putting programmers in place relating to financial wellness, mental health wellness, mindfulness and stress management.

2. Feedback will need to Be Supported By Regular Coaching Conversations

The performance management debate has focused heavily on the importance of frequent, real-time feedback. If companies want to achieve genuine performance gains, frequent feedback needs to be accompanied by regular coaching conversations, during which the manager and employee step back and reflect on the feedback that has been given, using it to discover strengths and highlight areas for development.

At work, such coaching conversations allow an individual to address and develop in terms of personal and professional development. The performance management trend towards coaching conversations and continuous learning has been driven in part by the increasing recognition of the power of growth mindset and continuous learning, something that Microsoft CEO Satya Nadella has heavily pushed at Microsoft with resounding success.

3. Performance Management will become ​“Meaningful” and ​“Human”

One of the major criticisms of performance appraisals or performance reviews is that they are contrived and not authentic. This is changing rapidly and the number one objective that HR professionals are now telling us they want to achieve for their performance management system is for managers and employees to have more meaningful conversations about performance and development.

The most successful organisations have done 5 things:

• Started with ‘Why’ — emphasized the personal benefits for employees and managers in having meaningful coaching conversations
• Used experimental training to prepare managers for having honest conversations
• Provided a clear framework for having conversations with suggested coaching questions and prompts
• Used specialist performance management technology to reinforce the framework, provide visibility, build new habits and change behaviors (read more on this here)
• Created accountability and led by example from the top of the organisation.

4. Performance Management Will Focus on How to Make Employees and Managers More Effective

Highly engaged employees are loyal employees who will go the extra mile to get their work done. As a result, employee engagement technology has growing significantly recently.Many analysts including Josh Bersin have predicted that there will be new trend — the optimization of productivity and performance, on both an individual and team basis. In other words, now that we have measured engagement, it is time to take action and improve it with the aim of making employees more productive.

According to Gallup, the biggest factor in terms of employee engagement is an employee’s manager. With this in mind, performance management and performance management technology will need to focus more on supporting and empowering people managers to be more effective, and enabling employees to bring their best selves to work. This, combined with well being initiatives, will play a vital role in boosting employee productivity.

5. Artificial Intelligence (AI) Arrive in Performance Management

AI is already having a big impact in recruitment and learning — there has been a significant innovation in tech within these areas. For organisations that have made the move to continuous conversations and feedback, have started to use AI to draw out themes from large amounts of qualitative data being gathered from feedback, goals and conversations. Software are being used to coach employees and managers in real-time based on the feedback being received, and even helping in predicting future high performers based on patterns, the content of feedback that is requested and received, and goals being set and achieved.

AI in HR has improved people decisions, and the growth of AI in HR will ultimately provide unbiased data that will guide decisions such as who to promote, and offer insight into who requires additional training to enable better performance while combating workplace bias. Artificial intelligence, virtual reality, bio-metric monitoring and other HR technology trends are becoming less futuristic and more grounded in reality.

Alongside these tech innovations is an increased focus on the people aspect of HR — the experience an employee has with a company, better ways to conduct performance reviews and new work habits.