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3 Ways Your HRMS Can Help You Optimize Performance Management

3 ways your HRMS can help you optimize performance management

In most organizations, managing employee performance falls into one of two camps: either it’s trapped in a cliché of once-a-year assessments by managers according to a system that hasn’t changed in years, or it is constantly tinkered with, changing every year or two as competency frameworks are adjusted, technology introduced or new feedback mechanisms trialled.

Neither of these scenarios is likely to result in good performance management, and for sure neither help boost employee confidence in the process.

So. If change is needed to stay up to date, but users also appreciate some familiarity and certainty, the only option is to make changes but make them count. When looking to optimize your performance management while maintaining this tricky balance, an HRMS can help.

1. Performance Management ‘In the Moment’

One significant change that an HRMS can facilitate is more frequent feedback on performance. In fact, rather than saving up information for that annual review, the constant recording of performance-related data can enable managers to give feedback to employees in real time: credit or correction where it’s due and when it’s due. The more immediate feedback is, the more likely the individual is to find it useful and actionable, meaning it is more likely to positively impact performance. After all, it’s nice to be noticed.

Another useful source of feedback is the individual’s peer group, including colleagues and key internal and external customers. An HRMS is ideally suited to facilitate 360-degree feedback and with silo-crossing communication tools and gamification, this type of feedback can also happen in real time and even be fun and motivational.

2. Longer-Term Performance Management

The other side of the performance management coin is managing the process long-term. At this point, we’re on the brink of talent management; but setting aside your high-performers and stars of tomorrow, all employees can benefit from a perspective that goes beyond a year.

First of all, there’s simple recordkeeping. An HRMS employee database with integrated performance management functionality provides a performance history for the entire tenure of each employee – a bigger picture with the opportunity to look at trends, patterns, or one-off blips.

This longer perspective can also connect performance management to career planning. The right HRMS can help set out career objectives, identify the support needed to achieve them, and monitor progress. 

The right HRMS can help set out career objectives, identify the support needed to achieve them, and monitor progress.

Apart from any other benefit, this helps retain millennial employees for whom career growth and development is often a key issue, laying out a clear path for them to follow. As this latest generation settles into management positions, becoming more numerous in the workplace than the previously-influential Baby Boomers, such needs must be considered.

The scope of performance can also be widened in another direction: that of the team. Subject to setup and integration between systems, an HRMS can potentially access employees’ electronic communications and contributions. By mining such data with particular types of transaction in mind – such as those between team members and colleagues – team performance can be analyzed more deeply, identifying any barriers to greater efficiency of working; effectively it becomes a ‘whole team’ feedback tool.

3. Better Use of Data

Effective feedback relies on facts. Saying to someone “I feel you can do better” is meaningless, especially compared to an approach that lays out a specific development direction, the need for which is demonstrated by specific past events. As already mentioned, an HRMS can collect sufficient data that the rationale for any feedback or proposed development is solid. In fact, the more information kept on the system, the clearer the steps to improved performance are likely to be. All that’s needed is the interpretation of the data. Surely, AI-managed performance is not far away…

Naturally, the other key use of performance data is analytics and reporting. As strategic decision makers seek data-driven insights, performance management data can be accessed and incorporated into deeper insights into activities from recruitment to compensation and reward, as well as breaking down the contributions to the wider corporate performance against agreed KPIs and other goals.

Company Performance Reports

About the Author

Dave Foxall has worked as HR Manager for the Ministry of Justice for a number of years and is a regular HRMS World contributor. He writes on a broad range of topics including jazz music, and, of course, the HRMS software market.

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