As organizations around the world have transformed their performance management practices from annual reviews to systems with more frequent check-ins, many of the technology platforms supporting the appraisal process have followed suit with their own innovations.
Reinvented performance management systems are designed to deliver more real-time feedback to enhance employee coaching and development and in some cases to disconnect reviews from annual merit increases.
More than 70 percent of companies responding to Deloitte's 2017 Global Human Capital Trends study said they were in the process of changing the performance management process in their organizations. About 83 percent said they had seen the quality of conversations between employees and managers go up as a result of process modifications, and 96 percent said their new processes were simpler and less bureaucratic. The Deloitte study included more than 10,000 respondents from 140 countries.
As appraisal processes have changed, the providers of talent management suites and stand-alone performance management platforms have upgraded existing systems or unveiled new ones to keep pace with the evolution. Many vendor systems now feature tools designed to support more frequent performance discussions and calibration meetings, to capture multidirectional feedback and make it easier to track related learning and coaching activities.
Automated e-mail, document routing, use of templates and new workflow functions make it more convenient for managers and employees to schedule and conduct these new-look performance discussions within the flow of daily work, as well as to recognize colleagues for accomplishments without having to leave core platforms. As business strategies, team objectives and individual goals change more frequently in disruptive markets, the more-agile of these systems can adjust by automatically updating goals and associated learning plans.
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Reducing Administrative Burdens
One concern for line managers about adding more performance discussions throughout the year is increasing the administrative duties of documenting reviews and resulting decisions about coaching, learning or other corrective actions. Vendors have responded by creating features and functions designed to make record-keeping and scheduling easier and more efficient.
"Most every vendor in the performance management market now has functions and tools that support more frequent check-in discussions and changing performance goals," said Stacey Harris, vice president of research and analytics for Sierra-Cedar, the company that conducts the industry's annual HR Systems Survey. Companies large and small are increasingly seeking technologies that support continuous feedback and performance review models, Harris said.
Kyle Lagunas, research manager of emerging trends and talent-acquisition technologies with consulting firm IDC, said the performance management technology market has undergone its own revolution in the last few years. "Vendors have worked to 'productize' proven best practices in performance management," Lagunas said. "In some cases, vendors have even driven the changes in performance management approaches. They understood the process needed to happen differently in today's business climate, with tighter feedback loops, opening those loops to include more co-workers or clients, and with goal systems that can change easily as strategies or team objectives change."
Lagunas said some vendors have built systems to fit company cultures rather than developed one-size-fits-all models. "The providers have essentially said, 'We are not for everyone,' and have developed performance management platforms for certain types of companies or philosophies and branded their systems around that," he said. "They understand that many buyers are looking for how well a platform fits their culture, as well as for cost and other features."
HR leaders looking for systems to support more-informal performance review cultures can choose, for example, from platforms that provide "journals" to allow managers and employees to document the results of coaching and feedback discussions. Rather than use a separate desktop or mobile application to recognize a colleague for good work, employees using these multipurpose platforms can do it through integrations with Outlook, Gmail, Slack and other popular communication tools.
Harris said some next-generation systems are designed around work teams, not organizations, and are more-user-friendly and data-driven than legacy systems. Some of these platforms also can ask for feedback without the need for managers or employees to trigger that action.
Buyers seeking technologies that support more-structured, compliance-driven performance management still have a large selection of systems to choose from, with those platforms featuring detailed forms, traditional rating tools or automated tools geared to complying with legal requirements or internal processes.
For HR leaders seeking systems that produce more comprehensive performance data, there are platforms with mobile-friendly dashboards that can track analytics like the results of check-in conversations, performance against goals, skills assessments and training, or coaching sessions completed. Organizations that still prefer to use traditional performance ratings to determine compensation can find vendor systems that offer adjustable formulas and other tools to calculate employee pay.
Many organizations continue to tinker with changes to their performance management systems, keeping some new elements and abandoning others as they evaluate the results of pilot tests. The same practice goes for industry vendors as they monitor how new features and functions on platforms are adopted by end-users.
"The age of experimentation with performance management is still upon us," said Brian Sommer, president of TechVentive, an information technology and HR systems consulting firm in Batavia, Ill. "Vendors continue to introduce new features and capabilities, but the jury is still out on what will stick and what won't over the long run."
Sommer suggested buyers of performance management systems do their homework so they can separate solutions from features on platforms, a process that applies to evaluating any HR technology. "There is a difference between a feature and a solution in vendor products," he said. "A solution can stand on its own and even have its own market. Features are more likely to become fads. We'll have to see what gets long-term traction and delivers real value for businesses when the dust has settled in the performance management technology market."
Dave Zielinski is a freelance business writer and editor in Minneapolis.
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