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  • Stacey Baez

Key Elements of Performance Management

The elements of establishing good performance management are simple but integration into a business’s fundamental operational process is more challenging than it seems. In an ideal world, an organization establishes metrics and targets from high level objectives down to daily activities that are continuously monitored and measured.

Metrics propel performance by creating checkpoints, during the process, to continually improve. When a measurable goal is not met, you make changes. When a goal is exceeded, you repeat successful processes.

The first step in measuring performance by adopting results approach is to identify the various areas in which an individual is expected to focus, the accountabilities.

Performance Standards – Define the standards of performance objectives, such as: Quality, how well the objective is achieved. Quantity, how much, how many, how often, and at what cost? Time, due dates, schedule, cycle times, and how quickly?

Adopt a behavior approach - This involves identifying competencies, measurable clusters of knowledge, skills and abilities that are critical in determining how results will be achieved. Identify indicators that allows us to understand the extent to which each individual possesses the competency in question. These indicators are behavioral manifestations of the underlying (unobservable) competency. Then choose the appropriate measurement system. You can distinguish between superior and average performance or measure what is needed to perform to minimum standard.

Customer satisfaction - Customer survey data results guide this metric. The product or service should do what it was meant to do and satisfy real customer needs. Each company can develop a score unique to its business by weighing each variable based on its importance. Variables may include customer survey results, revenue generated from clients, repeat or lost clients, and complaints.

Turnover Rate - Looking at the types of turnover and the underlying causes of it gives context to your company’s turnover rate and helps you to understand its implications. If you're a stable business that is neither growing nor shrinking, you can use the following formula: Number of people who left / current employees. Because you're hiring to replace, it will give you a pretty accurate look at what percentage of your employees are leaving each year.

Absenteeism - It’s widely known that motivated employees are likely to take fewer sick days or casual leaves, due to their genuine involvement in the job. A low absenteeism rate means HR and infrastructure investments are realized, leading to high organizational performance.

Sales Growth - In order to measure sales growth in an actionable fashion, track the individual performance of sales employees against their targets and territories. Be flexible, see what’s working, what isn’t, and readjust as necessary to ensure better productivity from your sales employees.

Team assessments - Provide an in-depth evaluation of a team’s ability to meet goals, as well as identify challenges. Additionally, communicating with the people with whom an employee works on a day-to-day basis c

an give you valuable insight on how an employee is performing.

Next, simplify the process. Make performance reviews a fast, frequent, and effective practice. Maximize productivity and efficiency in the workplace.

Build forms - Create performance evaluation forms to elicit feedback, using questions and surveys that collect the exact information you need.

Automate - Schedule the review to send automatically and set notifications to ensure the cycle runs consistently and efficiently.

Set goals and objectives - Set well defined objectives that are clearly communicated and track progress against initiatives.

Create reports and dashboards - Customize reports and charts specific to the individual and group goals and objectives so their priorities remain in the forefront daily.

Communicate Effectively - Ensure information is current and communicated efficiently so teams will always be equipped with the knowledge they need to maintain course towards their goals and objectives.

The reason most people never reach their goals is that they don’t define them, or ever seriously consider them as believable or achievable. So, step on the scale and take an inventory of your current status. Determine which metrics will best guide your business goals and then get to work.

Winners can tell you where they are going, what they plan to do along the way, and who will be sharing the adventure with them. -Denis Waitley

About Our Guest Writer

With a Master Degree in Human Resources and Labor Relations as well has SHRM-CP certification, Stacey Baez has over 10 HR experience and is an Adjunct Professor with NYIT’s School of Management in HR, and Stonybrook Universities School for Professional Development and is Co-Director with the Dispute Resolution Institute of NY, an educational think tank focusing on managing workplace issues and resolving conflict where she develops and presents customized training program for organizations. Feel free to contact at

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