Creating an Ongoing Feedback Loop for Employee Performance Management

by Gary Schafer | Nov 20, 2019 | Performance Management

Performance assessment and management should be two of any business leader’s top priorities. Unfortunately, discussions about specific employee performance often get lost in the shuffle until a serious issue arises.

That’s because the prevailing performance assessment model feels awkward and inauthentic to most of us – whether you’re the one being assessed or the one doing the assessing. Yearly or quarterly appraisals create “heck weeks” for managers during the review window and create anticipatory anxiety for workers that damages their buy-in and daily productivity.

The long-term performance management strategy we inherited from the 20^th century just doesn’t work well anymore. Given the pace of business and the capabilities of technology, we need performance management processes that are more agile, more responsive, and more immediate.

Moving forward, we’ll explore:

The true value and potential of a constant feedback loop around employee performance
How transitioning from a yearly or quarterly assessment system to an ongoing performance management process can be easier than it sounds
Guiding principles organizations can use as they begin to build their new performance management system

Why Constant Evaluation is Best for Business

Instead of thinking about employee performance on a yearly or quarterly term, businesses of all sizes, industries, and developmental stages should begin to transition toward a culture of constant, on-going evaluation.

It’s easy for that statement to produce a knee-jerk reaction because, on its surface, it does sound like more work and more stress. The fact of the matter, however, is that ongoing assessment provides more value and more authenticity.

Let’s explore some of the ways an ongoing performance assessment feedback loop can be beneficial to a business:

Keep Leadership Aware of the Organization’s Pulse

Senior leaders frequently express frustration that they are unaware of individual employee performance issues until they become a business, legal, or HR problem. That’s because the prevailing yearly assessment system leaves them in the dark for months at a time.

When there’s a formal, ongoing, well-documented discussion about performance between each employee and their direct supervisor, it’s far easier for managers higher up in the chain of command to “take the temperature” of each team or department at a glance.

Be Proactive, Not Reactive

Performance management that operates on a quarterly or yearly term basically assumes that everything is going fine. Unfortunately, however, we live and work in the real world, and that means some things aren’t fine.

When you assess each of your employees regularly, you create a framework to proactively identify low-performing employees or teams and shorten the time that bad apples stay in the barrel. Your ground-level supervisors and team leaders gain a vocabulary, a structure, and a support system that they can use to help senior leadership prevent small problems from turning into big ones.

Maintain Open Lines of Communication About Performance

Yearly performance reviews are a tense time around the office because, when someone’s assessing an entire year of your life, it’s hard not to feel like the process is deeply personal, judgmental, and potentially punitive.

An ongoing performance management strategy makes professional feedback and conversations about improvement part of daily or weekly life within each team or department. That means there’s less of that long-term stress the yearly model creates, and the entire conversation seems more casual, with everybody having a voice and staying plugged in.

Engage Your High Achievers

It’s easy to think of “performance management” as “identifying and eliminating underperformers,” but too often, we forget about the importance of recognizing the great work that high achievers are doing on a daily basis.

Many of your employees who quietly, consistently do well are yearning for a grateful, reassuring pat on the back, and an ongoing conversation about performance with specific feedback is a great way to do that. When great talent feels valued and seen in the workplace, they’re much more likely to stick around or develop into leaders themselves.

Implementing Ongoing Performance Management Isn’t as Difficult as it Sounds

Anytime you say something is going to shift from a yearly practice to a weekly, daily, or ongoing practice, employees understandably get concerned that you’re about to create a lot of additional work for them.

Thankfully, however, transitioning toward an ongoing performance assessment and management model isn’t actually as daunting as it seems because a lot of the system you need to create already exists on an informal level.

Let’s explore some of the reasons adjusting your assessment timetable isn’t as disruptive as you might expect!

Much of the Tech Support Framework is Already in Place

Unlike the supervisors and performance assessors who created the annual appraisal system, you have access to modern HRIS, HCM, document sharing platforms, project management software interfaces, and so on.

That means your supervisors have many ways to measure how their team members are doing that don’t involve looking over their shoulders or having unnecessary, distracting conversations. Our tech-enabled work environment is constantly capturing insights about how individual employees work and achieve differently – it’s just about using that data to its full potential.

By the same token, technology platforms make it easy to house performance management or assessment information in an easily accessible way, so visibility is maximized for supervisors and employees alike.

Team- and Department-Level Leaders are Just Formalizing What They Already Do

Many supervisors, managers, and team leaders in your organization are already making constant performance assessments about everybody they work with. When you transition toward a formal ongoing assessment model, you’re just empowering those leaders to turn those insights into action in the workplace.

When you change models, you’re not creating new anxieties for your managers, you’re providing them with a framework to document their concerns and use them as a basis for authentic discussion about what needs to happen in order for organizational performance to improve.

Employees Want to Know How They’re Doing

Contrary to popular belief, most employees are hungry for feedback. Feedback makes people feel more secure – even constructive feedback – because there’s nothing worse than not knowing how you’re doing.

For many employees, timely feedback can be the difference between feeling underappreciated or feeling entirely bought-into the organization’s mission and vision.

Many business leaders assume buy-in and morale are major hurdles to having more serious conversations about employee performance, but if employees know they have an authentic voice in the system, they will engage.

How to Transition Toward an Ongoing Performance Evaluation Model

So now that we’ve obliterated the myth that ongoing performance management is challenging, creates more work, and harms morale, let’s take a look at what each business needs to do to create a successful, powerful assessment system.

Provide Training to Turn Your Managers into Professional Assessors

For your ongoing performance evaluation system to work well, your supervisors, team leaders, managers, and other assessors need to be really good at giving targeted, thoughtful feedback, brainstorming solutions or improvement plans, and talking to employees in a way that feels supportive and positive yet firm.

Not everybody naturally knows how to do all those things. While some of your supervisors might have gone to school for business management, others have probably risen through the ranks or achieved their position by demonstrating other key skills.

Getting performance management right requires ensuring that each assessor is well-versed in best practices for performance assessment, feedback creation, and so on. That will most likely require some professional training from an outside consultant, but great coaching is the fuel that powers strong performance.

Create a Data-Driven Assessment Process

In order for any assessment system to truly work, it must be fair and based in a shared, objective understanding of the facts. That means your approach to performance management needs to avoid over-reliance on qualitative, observation-based manager feedback and focus on the data.

Thanks to the backend data from those HCM systems, project management applications, and other tech-enabled work platforms we discussed earlier, it’s easier than ever to gather data about work completion times, project success, and other relevant measures of performance. If you bring in a performance management consultant or similar professional, they can also help you identify other easy-to-access data points that can tell powerful stories.

Build in Both Accountability and Mutual Protection

A bad or incomplete performance management system can potentially get your business into a lot of trouble.

On one level, poor performance assessment leaves you vulnerable to sagging business or employee disengagement. On the other hand, bad performance management practices can also lead to wrongful termination claims and other legal issues.

As you design your ongoing performance management system, it’s crucial that you back up your new practices with appropriate, legally compliant policies and provide employee training to guarantee awareness of best practices and key accountabilities.

You need to be sure you’re building something that will hold up to outside scrutiny, display your company values in a positive manner, and help everybody appreciate the weight and importance of the work they do on a daily basis.

Key Takeaways

As we move into 2020, we must augment our practices to reflect the faster pace of business and the increased urgency of success and profitability at scale.

Proactive, ongoing performance management has the potential to strengthen any business and foster healthier discussions about work between employer and employee. Just remember:

Constant assessment creates a feedback loop that keeps employees, ground-level managers, and upper leadership on the same page when it comes to talent and performance management
Regular feedback sets low achievers up for improvement and provides high achievers with the recognition they need to thrive
Making the transition to ongoing feedback isn’t as difficult as you might think as you’re just formalizing and validating the work that many of your managers are already doing in an unstructured way
Rolling out your new assessment system requires appropriate educational support for both assessors and individual employees to ensure strong coaching and good buy-in
Feedback should be based in measurable data, not just qualitative observations or feelings

How to Hire Top Talent on a Startup Budget

by Gary Schafer | Jun 28, 2018 | Compensation, Human Resources

Whether you’re pre or post-funding, hiring top talent on a growing business’ budget is challenging. Larger organizations can offer candidates lucrative salaries, stability, and expensive perks. However, there are several strategies you can use to hire great talent while keeping costs down.

In today’s post we’ll explore five ways you can build a top team on a budget. We’ll cover:

Leveraging independent contractors, interns, and part-time hires
Seeking out non-traditional employees
Offering low-cost high-impact employee benefits
Offering equity
Aligning compensation with company performance

Leveraging independent contractors, interns, and part-time hires

Independent Contractors

In cases when you can put off bringing in a full-time team member, an independent contractor or freelancer may be the best option. For example, you might contract a developer to mobile-optimize your website or build an app for your product. In these cases, hiring a full-time team member doesn’t make sense. Contract employees allow you to leverage a wide range of talent without committing to hiring a full-time employee.

Consider contracting commission-only salespeople or manufacturer’s reps if you’re not ready for a full-time sales hire. Another great idea is to hire freelance marketers to write and promote content for your blog or to execute your social media strategy.

Sites like Upwork and Guru can help you find freelancers to fit your budget.

Part-time

If you need extra help but aren’t quite ready to bring a full-time staff member into the role, a part-time hire may be a great option. There are many highly-skilled individuals looking for part-time work. A part-time hire allows you to get the help you need while also remaining payroll-friendly.

Interns

While interns may require guidance and coaching, there are several areas they have natural strengths in. As part of Generation Z, most interns are highly skilled in social media and online presence. If you partner with local colleges, you can find interns in nearly any field from marketing, to accounting, to software development. You may choose to make your internships unpaid or paid. Paid interns can receive an hourly wage or stipend. It’s important to understand that although interns can be valuable, low-cost team members, they will need significantly more guidance than traditional employees.

Seek out non-traditional employees

When recruiting talent, may business owners make the mistake of overlooking non-traditional employees. Non-traditional employees might include those who are not currently working, those looking to re-enter the workforce, older employees, or employees who are outside of your industry.

While non-traditional employees are often overlooked, these individuals present a unique opportunity for your business. Often they are extremely eager to work and will go above-and-beyond for your business. It’s also not uncommon for their salary expectations to be more in-line with what a startup can afford.

You can leverage LinkedIn to source and outreach to non-traditional employees.

Offering low-cost high-impact employee benefits

People, especially Millennials, are willing to sacrifice a higher salary to work somewhere they truly enjoy working. Making your company a great place to work can be your secret weapon in the struggle to hire and retain the best talent. Offering attractive employee benefits and team perks is a great way to improve workplace satisfaction and attract top talent to your company.

Some business owners have the misconception that they need significant funds to afford expensive employee perks. However, there are many low-to-no cost methods you can utilize to transform your company into a sought-after workplace. Some great options include:

Flexible scheduling: allow your employees to work non-traditional hours. For example, an employee with a flexible schedule might work 10:00am-6:00pm or 8:00am-4:00pm. Another example of flexible scheduling is to allow your employees to come in late or leave early on some days without taking PTO. Many employees see flexible scheduling as a huge value add as it allows them to take care of their families while also balancing their workload.
Remote working: allow team members to work remotely, either some of the time or all of the time. Offering a remote working arrangement doesn’t cost your business anything but is seen as an attractive perk by potential employees.
Casual dress: nowadays most employees don’t want to put on a suit every morning to go to work. Offering casual dress and a relaxed work environment can make your business a more attractive place to work for younger talent.
Standing desks: having standing work areas in your office requires a small financial investment up front but can be a huge value-add to your employees. Many Millennials realize that “sitting is the new smoking,” and appreciate a work environment that encourages healthy behaviors.
Bring your dog to work: if your office space accommodates it, allowing employees to bring their dog to work is another no-cost way to appeal to great talent. For employees with a dog, being able to bring their dog with them to work not only gives them piece of mind but also saves them significant costs on pet care.
Food and drink freebies: offering your team free snacks, soda, or coffee can help boost morale and make your company a great place to work.
Team meals: whether it’s once a week or once a month, offering a free catered meal to your team is an attractive benefit.
Corporate responsibility: give employees dedicated paid time off to volunteer on a monthly, quarterly, or yearly basis. Nowadays, employees are looking for a workplace that affords them a greater purpose in life. Instilling opportunities for volunteerism can make your company more attractive to purpose-driven employees.

Offering Equity

While larger companies attract employees with lucrative salaries and stability, startups afford their employees the opportunity to directly reap the rewards of the company’s financial success via equity in the business. Equity is a unique bargaining tactic startups possess that larger organizations don’t, and it should be leveraged accordingly.

If a particular candidate is risk-for-reward driven, they will often forgo a higher salary now for the promise of potentially greater financial rewards in the future. Not to mention, financial equity aligns your team with the company’s long-term objectives. As such, aim to actively involve these team members in important business decisions moving forward.

Aligning compensation with company performance

Another strategy to hire great talent when your cash flows are tight is to offer a lower salary upfront, but with the promise of incremental salary increases in the short-term future. For example, you might offer an employee 60% rate of market compensation up front but include the opportunity for 80% market salary within one year if a financial company milestone is met.

You might also structure employee salaries with a below-market base but the option for a significant year-end bonus if your company’s financial goal is met. Aligning compensation with company performance keep costs down and aligns employee interests with company goals.

Key Takeaways

In today’s post we explored several ways you can hire great talent on a budget. Some key takeaways include:

In cases when a full-time hire doesn’t make sense yet, contractors, part-time hires, and interns can be cost-effective options
Non-traditional employees can be skilled hires willing to accept lower salaries in exchange for experience at your company
You don’t need a large budget to offer high-impact employee perks like flexible hours, remote work, or causal dress
Equity can entice top talent to forgo a larger salary up front in exchange for the opportunity for future gains
Structure incremental performance-based salary increases into employee compensation

What methods do you use to attract and hire great talent on a tight budget? Drop your ideas in the comments box below.

A Simple Yet Effective Employee Engagement Survey You’ll Actually Use [Template]

by Gary Schafer | May 4, 2018 | Employee Engagement, Employee Retention, Human Resources

Employee engagement is key to your employees’ morale and productivity, which has an important impact on your bottomline. Understanding what employee engagement is and how to leverage effective employee engagement surveys is a great place to get started with creating a more engaged workforce. In this post I’ll explore why employee engagement is important, then outline a highly-effective employee engagement survey template, and finally provide step-by-step instructions on how to get started with quantifying and improving your company’s employee engagement.

What is employee engagement?

Employee engagement is the level of enthusiasm, dedication, and connection employees have to their organization and their work there. Employee engagement measures how motivated employees are to exceed performance expectations and indicates how committed employees are to staying with the organization for the long-term. Employee engagement is the direct results of company culture, management practices, and the overall work environment created.

Why is employee engagement important?

Employee engagement is important because engagement can have a big impact on your workforce’s productivity, which affects your bottomline. Several studies have correlated an engaged workforce with a multitude of business benefits. A survey of over 24,000 businesses conducted by Gallup found that companies in the top quartile of engagement average 18% higher productivity and 12% higher profitability than companies with poor engagement. An additional survey of over 600,000 employees conducted by the UK government found that companies with high employee engagement increased income by 19.2% while companies with low engagement saw revenue drop by 33% over the same period.

Research by CultureAmp also indicates that engaged employees are 20% more likely to recommend their employer on Glassdoor—a critical component to attracting top talent. Their research also showed that engaged employees are 30% less likely to be actively looking for another job.

Engaged employees:

Have higher job satisfaction
Are more committed to the company and its long-term goals
Are more likely to become high-performers
Are less likely to turnover
Want to succeed and want the organization to succeed
Are more willing to go the extra mile to help the company
Support the company’s mission and believe in the vision

Companies with high rates of employee engagement enjoy results like:

Decreased turnover rates
Increased productivity
Increased efficiency
Increased profits
Better ability to attract and retain top talent

Even with all the above benefits, many companies are not doing a great job at creating an engaged workforce. Studies by Gallup found that only 33% of employees are engaged at work. They also uncovered that organizations with a poorly engaged workforce experienced 30-50% higher turnover rates than companies with engaged employees. The good news is that there are several steps you can take to improve employee engagement at your company. This process begins will implementing highly-effective engagement surveys.

How to Get Started With Employee Engagement Surveys

Engagement surveys get a bad rap for being ineffective. This is usually because they’re too long, poorly designed, ineffectively distributed, or lack high-impact questions. However, with the right approach, engagement surveys can provide increased insight into your workforce’s engagement, productivity, and job satisfaction. Effective engagement surveys transform anecdotal employee experiences into hard data, which will allow you to strategically approach, monitor, and refine your employee engagement efforts.

Before customizing your survey questions, your first step should be to identify benchmark engagement levels. Data without the context of industry-relevant benchmarks will not provide useful insights. Because employee engagement varies widely with company industry and size, take these into account when researching benchmarks.

When designing your questions, remember there are several facets that play into an employee’s overall engagement level. These include employee opinion on management, overall work environment, relationships with coworkers, opportunities for advancement, and understanding and belief in the company mission. A good employee engagement survey should include questions that determine satisfaction in each of these areas.

Don’t forget that an employee engagement survey only matters if you plan to act on the results. In advance of conducting your survey, establish buy-in from leadership and put time on the calendar to review survey results.

Here are some key things to keep in mind when designing your employee engagement survey:

Before designing your survey, pinpoint industry-relevant employee engagement benchmarks
Establish buy-in from leadership before conducting an engagement survey
Include questions that cover all facets of employee engagement
- Opinion on management
- Work environment
- Relationship with coworkers
- Job enablement
- Opportunities for advancement
- Understanding company mission

12 High-Impact Employee Engagement Survey Questions (And Why They Work)

1. On a scale of 1-10, with “1” being very unlikely and “10” being very likely, how likely are you to recommend [Company Name] as great place to work?

A Net Promoter Score is a single-digit figure that summaries a customer’s satisfaction with your company. In the context of an employee engagement survey, you can reframe this question to uncover your employee workplace satisfaction, therefore creating an “internal” net promoter score. An employee’s likelihood of promoting your company as a good place to work is a strong indicator of their overall engagement level.

2. I receive recognition for a job well done.

Receiving praise and recognition is one of the strongest influencers of workplace satisfaction and employee engagement. It’s important to help employees understand how their work impacts the rest of the organization. This question can gauge employee satisfaction with the amount and quality of recognition they receive.

3. I trust my immediate supervisor/manager.

Trust is a crucial foundation for any productive manager/employee relationship. Employees and managers don’t have to be friends—but for it to be a positive relationship there must be a basic level of trust. Employees who don’t trust their manager will struggle to perform optimally and become engaged.

4. I trust the upper management/leadership team.

Similar to the previous question, an employee’s trust in upper management is critical for an engaging work environment. A high level of trust in company leadership indicates employees believe in the leadership team’s company vision and their ability to achieve it.

5. My coworkers are committed to doing quality work.

This question indicates an employee’s perception of the overall work culture. Environments where all employees are held accountable and motivated properly are the best for employee engagement. If employees perceive that their coworkers are not being appropriately held accountable, this can create a toxic work environment. The above question will gauge your employee’s perception of the work dynamic between employees.

6. My coworkers respect each other.

This is another question to help gauge the work environment. It’s important that your team is establishing mutual respect. If your workplace is filled with gossip, harassment, or other negative sentiments it can quickly create a toxic work environment. Use this question to gauge how positive the relationships between employees are.

7. In two years, I still see myself working at [Company Name].

This question can give some insight around your employee retention rate. If employees don’t envision a future with your organization, this indicates unhappiness with the workplace environment and an absence of transparent future career opportunities.

8. [Company Name] motivates me to go above and beyond what I would in a similar role elsewhere.

This question gets at your employee motivation levels. In organizations with high employee engagement, employees are motivated to go above and beyond because they believe in the mission of the organization and understand their important part in achieving this vision. If your employees do not feel motivated to go above and beyond you should identify opportunities to increase performance.

9. I have access to the tools, resources, and training I need to do my job well.

This question gets to the heart of job enablement at your organization. The point of this question is to understand if employees believe they have the resources they need to perform their job at the highest level.

10. I understand what I need to do to be successful in my role.

This question pinpoints if your employees’ job expectations are clear. If employees have a clear understanding of their success metrics, it gives their day-to-day work direction and purpose. It also instills a feeling of upward mobility which helps keep employees on board. If employees indicate their job expectations are unclear, this can indicate a poor relationship between management and employees.

11. I believe there are good career opportunities for me at [Company Name].

This question also hones in on employee perception of future opportunities. If employees perceive good future opportunities for themselves at your company they’re more like to be high-performers and much less likely to look for another job. If employees do not believe there are good opportunities for them then there could be a lack of transparency around growth opportunities or underinvestment in employee training and development.

12. Is there we could be doing better at [Company Name]?

In an employee engagement survey it’s always important to provide an open-ended question. The point of this question is to provide employees an opportunity to give candid, anonymous feedback. While this feedback won’t be quantified, it can provide some anecdotal evidence towards areas of your engagement strategy that could be improved.

How to Use This Employee Engagement Survey Template

Customize the questions with your company name. Also feel free to further customize the questions, omit ones that you don’t believe are relevant to your workforce, and add your own questions. Just remember to keep the survey relatively short (15 or less questions is ideal for maximum impact).
Determine how you will distribute your survey. The easiest way to distribute an engagement survey is digitally. Google Forms or SurveyMonkey are both great options for distributing your survey and analyzing the results.
It’s important to note that the most effective engagement surveys are completed anonymously. If the surveys are anonymous, employees are more likely to be honest and give candid feedback. No matter which platform you opt to send your survey through, make sure your survey does not require employees to entire their name or email address.
Distribute your survey via email. Including a note from the leadership team about the purpose of the survey can help drive forward your engagement vision. Make sure to follow-up with your employees several times to remind them to complete the survey.
After you’ve collected responses, analyze the results. Gather your leadership team to discuss the findings from your survey. Compare your engagement levels to industry benchmarks. Based off the results to specific questions, identify the biggest areas of opportunity for improvement. Create a plan of action as to how you’ll address these areas.
Set a timeframe for when you will distribute another engagement survey to measure changes in engagement (three to six months is ideal).

Key Take-aways

As you can see, employee engagement surveys can be effective if they’re done right and include high-impact questions. Here are some key take-aways from today’s post:

Employee engagement creates a happier, more productive workforce.
Establish buy-in from your leadership team about the importance of employee engagement.
Always compare your engagement data against industry benchmarks.
Use short, high-impact surveys (and make sure they’re anonymous to receive honest feedback).
Use the results of engagement surveys to discover areas of opportunity and create an action plan for increasing employee engagement.

Do you already use an employee engagement survey? Will you start regularly distributing and analyzing engagement surveys? How important do you think employee engagement is in the modern workplace? I’d like to hear your thoughts—drop them in the comments box below.