Implementing Performance Management In 4 Steps

If you want to improve your team’s motivation, competency, and engagement, a performance management system can definitely do the trick. It’ll help your team members understand their objectives and expectations, and improve their relationship with you – their manager.

However the key is to implement it properly. If you’ve never used performance management with your team before, start by making sure everyone understands how it works and what’s in it for them. By letting them know its a win-win situation, you’ll minimize the potential that they’ll get defensive or dislike the process. Consider inviting your team to participate in deciding how their performance will be assessed – people tend to support what they help create!

So what are the steps of the performance management process and how does one go about implementing them? We read Herman Aguinis’ book on Performance Management so you don’t have to, and will tell you everything you need to know in this article. Read on! 


Step 1: Set Expectations

Meet with each employee to discuss which results and behaviours you expect them to demonstrate. Be as specific as possible to ensure everyone is on the same page. This avoids an “I didn’t know I was supposed to do that” situation in a few months. Don’t  listoff what you want and expect your team members to quietly obey. Instead, ask your employee to participate in deciding what is realistic for her to achieve.



Specify what you expect the employee to deliver. Be sure to clarify:

  • Accountabilities: What are her responsibilities?
  • Objectives: What should she aim for? Objectives should be challenging but achievable. Let the employee participate in setting them. After all, she’s the one doing the job and could know better than you what is feasible and what is unrealistic. Set some deadlines and milestones, and decide together which ones are priorities. Side note: don’t overwhelm her with too many objectives that she may have trouble managing. 5-10 per review period is best.
  • Performance Standards: What minimum quantity and quality of work do you expect? How much money is she supposed to raise? How much time do you expect her to take to accomplish these things?  Performance standards should be observable, measurable, and relevant to the purpose of the job. They should also be achievable.


Results are important, but focusing only on results may give you an incomplete picture. For some jobs, it can be hard to establish objectives. For other jobs, employees may have control over what they do, but not the results. For example, a sales specialist’s figures may vary by her assigned sales territory as well as  her efforts. In such cases, specify what actions she is expected to do, not just the outcomes.   

Development Plan:

You’ve both agreed on results and behaviours. Now what? Take some time to chat about areas that need improvement and set a few developmental goals for the term. Ask the employee how she thinks she can do better, and how she can avoid problems faced in the past. This helps improve and sustain performance, and gives an opportunity to discuss growth. Most people don’t want to work for just a paycheck, so take this opportunity to show how her job is a more enriching and motivating experience. Be sure to specify a few resources or strategies she’ll be given to reach those goals, such as training or useful articles.


Step 2: Observe and Help Them Perform


You’ve set our your expectation, and your employee participated in setting his objectives. Now take a step back and observe. Help him out as necessary, and keep in regular communication.


  • Give Ongoing Feedback: Rather than waiting until the review period is over, be sure to give feedback and coaching on a regular basis.  This ensures the employee develops and helps him reach his objectives. Give advice or concrete criticism as needed.
  • Reinforce: Likewise, make sure he maintains good performance by making it clear it is being noticed. If good performance is not praised, employees will lose motivation. This is especially crucial when an employee exceeds his performance standards or expectations. If you don’t acknowledge it, he will surely think: why bother…
  • Give Updates and Resources: As your project goals change, so may the employee’s objectives. Be sure to update him on any such changes immediately. Give any resources you agreed to provide to facilitate his goals as early as possible so that they have time to help improve his performance Whether its training, tools, or readings, make sure he has what he needs to do his job.
  • Observe and Collect Performance Info: Keep track of examples of good and bad performance on a daily basis. These examples will be used during the performance review to help him learn how to do better or what to continue doing.


Step 3: Assess Their Performance

Now that you’ve observed how the employee did throughout the review period, it’s time to assess her results and behaviours.


Should You Assess Results or Behaviours?

As we explained earlier, for some positions it may be appropriate to evaluate results, for others behaviours, and for some – both. To help you figure out what to assess for what employee, consider this:

  • Assess Results If: Efforts will always give results, results show consistent improvement over time, or if there are several different ways to do the job right and get good results.  
  • Assess Behaviours If: Efforts and results don’t connect in an obvious way, Results take months to develop, or if bad results can come from factors outside of the employee’s control.

How to Assess Behaviours:

While assessing results is pretty straightforward, you may be wondering how on earth to assess behaviours? One option is to simply write an evaluation, describing the employee’s strengths and weaknesses and where she needs to improve. Another option is to do a behaviour checklist. Here you will be able to check off whether the employee showed the said behaviour never, sometimes, often, or always. There are many great options your team can choose to evaluate behaviours. It matter less which one you pick–it matters more that your team has been a part of the selection process and they’ve agreed its a fair metric.

Appraisal Forms:

An important way to assess performance is to fill out a template or complete an appraisal form. You can also invite the employee’s peers to complete one, as this can be a great way to assess teamwork or how the employee acts when you aren’t around. However peer evaluations can be suspect to biases and context, so don’t rely on them as your sole source of information.

Self Appraisals:

Let the employee do a self-appraisal as well or give her a chance to explain how she thinks she did. Self-ratings pinpoint discrepancies between self-views and views of others. It is such discrepancies that stimulate development. Self-evaluations will also minimize defensiveness, help her learn, and ensure she feels the performance management process is fair.



Step 4: Review How They Did

The final step is to sit down with the employee and discuss how he performed throughout the review period.  Here you will share your observations, assessments, and feedback. You’ll also ask the employee for his opinion on what he did well and what he needs to improve on. You can then both brainstorm ways to improve performance during the next term.  You should also discuss his developmental progress and plan for the future.

Clarify which goals you expect him to achieve in the next term. A big part of this step is to adjust his future goals based on his experiences this term. Perhaps you’ll realize that some of his objectives were unrealistic. You’ll need to make sure the next ones are achievable. Maybe the goals were all too easy, and you need to level up the challenge for the next term.

Here’s some steps you can take for an effective review.

  1. Explain what the employee did well or poorly, and give specific examples of wanted/unwanted behaviours.
  2. Ask the employee for feedback about these behaviours and listen to his explanations.
  3. Explain the implications of changing or not changing those behaviours. If the employee did something well, give praise and explain how that benefited the team. If he did something poorly, make sure he’s aware of what will happen if he continues.
  4. Give advice on how he can perform better.
  5. Agree on an action plan.
  6. Set a meeting to follow up and agree on measured behaviours and results.
  7. Adjust goals and objectives for the next term as needed.

How often should the performance management process be done? A review period can be anywhere from monthly to quarterly or even annually. The choice is ultimately up to you and your team’s needs, but it’s worth thinking about the fact that the shorter your feedback loop is, the faster you will be able to improve your team members’ performance.

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