Why Your Company Needs Continuous Performance Management

In this new era of work, marked by disruption and upheaval, companies that take a hands-on approach to implementing a continuous performance management process are leading the charge in employee engagement.

So, the key to aligning and connecting your team isn’t just in your communications or the technologies you use — it’s integrated into the way your company manages performance, from onboarding to exit.

Given that, let’s talk about your performance management process.

continuous performance management with Kazoo -- unlock the power of your people

What is performance management?

Let’s discuss what performance management is before going any further.

Performance management is the means by which your organization identifies, measures, and develops the workplace performance of each employee, team, and unit in support of your overall goals and objectives.

Practically speaking, it’s an ongoing, continuous practice that incorporates goal-setting, performance reviews, engagement surveys, and more.

So if your organization were a machine, your performance management system would ensure all of the cogs were well oiled and operating at their highest capacity.

Because your company is a living, breathing, human organization, performance management ensures not only that each employee is working as well as they can now – but also that they’re actively engaged, experiencing career development, and invested in your company’s success.

And now, you can manage it all in one place. Learn:
What is an Employee Experience Platform?what is an employee experience platform? it's when everything is working better, together, including continuous performance management

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What continuous management means in today’s workforce

With Gallup reporting 22% higher profitability in organizations with high employee engagement, human resources professionals worth their salt have spent the past three decades focusing on engagement initiatives — starting with performance management.

More recently, technological developments like performance management platforms and software have majorly changed the game.

Programs and processes that used to be cumbersome or ineffective (like generating engagement surveys, or managing goals) can now be completed with just a few clicks. So it’s easier for HR leaders to collect human data, spot trends, and engage employees, all while maximizing the impact of performance management programs and processes — no matter where your team is working.

What can continuous performance management do for your company?

The numbers don’t lie — continuous performance management pays off.

As Jamie Gruman and Alan Saks point out in their article “Performance Management and Employee Engagement,” the performance management process is the “Achilles’ heel” of an organization — it has the power to make or break employee performance and engagement. 

The accompanying price tag for HR leaders who don’t heed the call is high: Gallup estimates that the cost of poor management and lost productivity in the U.S. is between $960 billion and $1.2 trillion per year.

So, look to the bright side. When performance at a company is well-managed and employees are working at their full potential, organizations reap the rewards. Gallup notes that high-performing teams experience an average of:

  • 40% less employee turnover
  • 37% reduction in absenteeism
  • 48% fewer staff safety incidents than disengaged teams.

This ultimately translates into higher profitability (22%) and productivity (21%). Put another way, each employee costs a typical U.S. company, on average, $1,250. Is your organization making the most of that investment?

This matters. Measure it.
How to Assess the Success of Your Performance Management

how to assess the success of your continuous performance management strategy

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6 components that should be part of your continuous performance management strategy

Gone are the days of the annual performance review. Modern employee performance management is comprised of a web of continuous, ongoing activities that help you assess and guide employee growth and engagement.

1. Employee check-ins

Employee check-ins are the heart and soul of a growth-powering review process. These casual one-on-one conversations are typically between an employee and manager about the employee’s performance, progress toward their goals, and what they need from their manager to be successful on work assignments.

Frequency matters. Perform check-ins weekly to create a comfortable tone and sense of ongoing, evolving conversation. This helps to create a fearless feedback culture where employees feel heard rather than simply managed, and can receive feedback thoughtfully. (Bonus: Check out our guide to creating a feedback culture.)

This helps set up your employee reviews for success: Employees receiving real-time feedback through weekly check-ins are more than 400% as likely to say that their performance reviews led them to do better work than those in workplaces with no coaching culture and annual reviews. This has stellar effect on productivity and employee development.

Want more? Check out our guide for effective 1-on-1 frameworks.

2. Performance reviews

Performance reviews are valuable opportunities to evaluate employee performance in the context of progress toward goalsworking style and efficienciesperformance standardsworkplace behavior, and growth opportunities.

From an organizational perspective, they allow you to assess employee potential and function; for workers, they highlight the areas of potential performance improvement and development opportunities you want your employees to keep top of mind.

When we say annual performance reviews are out, we don’t mean you’re done with performance assessment altogether.

On the contrary: HR leaders at organizations that conduct frequent performance appraisals are 1.5 times more likely to agree that they accurately reflect employee performance, compared with reviews performed only annually. To get the best bang for your buck, your organization should be performing them once per quarter.

Bonus: Check out our Ultimate Guide to Performance Reviews.

3. Recognition and rewards

It’s not just about creating a feel-good company culture: As we note in the Science of Employee Recognition and Rewards, 80% of employees note that they feel motivated to work harder when their boss shows appreciation for their work. This means a little recognition can give your company a big productivity boost.

If recognition and rewards aren’t an active part of your performance management cycle, look for ways to integrate verbal praise, leaderboards, and rewards systems. Showing appreciation for goals met, values demonstrated, and good work keeps employees engaged and working toward your company’s goals.

4. Goal setting and management

The importance of setting goals is neither secret nor new – as long ago as 1968, goal-setting thought leader Edward Locke demonstrated that over 90% of the time, setting specific, challenging goals led to higher performance than setting vague or low-bar goals. And if you’re here, you’ve probably sat through more than your fair share of seminars on SMART goals (and if you haven’t, check out our article, How to Write SMART goals!). The real question is, how is your organization putting those principles into practice?

To make sure goals are driving employee engagement, work with managers to ensure their team members’ personal goals are closely aligned with the organizational goals, and that progress toward these set goals is part of their regular check-in conversation and performance evaluation. Support this with a solid goal management software for transparency and accountability. Check out our Definitive Guide to Setting Goals at Work for more.

5. 360 feedback

Traditionally reviews have been top-down, featuring only a manager’s feedback on employee performance. But it’s far from a complete picture. That’s why you should be using 360 reviews. These incorporate feedback gathered from the employee, their peers, direct reports, and managers.

These varied perspectives allow employees to get a full picture of their strengths and opportunities for growth. 360 reviews also require more self-awareness on the part of the employee, and a greater sense that their perspective is valued – a shortcut to boosting employee engagement.

6. Engagement surveys

With Deloitte reporting that 87% of organizations cite engagement as one of their top challenges, tracking employee engagement should be top of mind for HR professionals. So your organization should be listening closely to employees and using data to drive decisions.

Employee engagement surveys measure employees’ commitment to your mission, trust in leadership, and value they place on their work. So administer these regularly – say, once a month. Because this shows employees that your organization hears and values their voices. And, it allows you to track trends and identify and address potential problem areas in your organization as they develop.

Learn how a platform changes the game:
Why Your Company Needs an Employee Experience Platform

why your company needs an employee experience platform

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What to look for in performance management technology

Ready to turn your organization’s performance management process around and optimize employee engagement? Here are a few things to consider when looking for performance management resources in the post Covid-19 work landscape:

  1. Business/solution fit. Before getting into the specifics, make sure that your technology provider fits with your company and its needs.
  2. Tools and resources. Then, what does this technology offer? What features will drive engagement?
  3. Integrations and support. Finally, select an easy-to-use performance management platform that will integrate with your existing technology.

Technology should fit your business, not the other way around


So, with these resources in hand, you’re ready to lead the pack. Because with a strategic performance management process, you’ll reap the rewards in employee engagement, productivity, and business results.

Check out our comprehensive guide, 5 Steps to Change Your Performance Management Process. Then,

Learn how Kazoo can help


This piece originally appeared as a Kazoo guest post in G2’s learning center