• Dr. Vishalli Dongrie, Partner |
4 min read

The last couple of years have brought in a myriad of changes and compelled organizations to rethink how they operate.  At the outset of COVID, what started as a stop-gap arrangement eventually morphed itself as the new-normal.

There are multiple factors that one needs to consider while redesigning performance management philosophy. With the change in the ways of working, evolution of new families of roles and the new operating model, organizations and managers will need to reassess the way performance is evaluated. Managers face a huge challenge to inspire and manage the performance of their employees. They would have to unlearn traditional ways of managing employees. The major challenges for the managers and organizations today are:

  1. Reducing proximity bias while evaluating performance.
  2. Contextualizing goal for different families of roles like GIG, neo- GIG, hybrid.
  3. Restoring trust among the employees through frequent and transparent communication.
  4. Managing performance when there is limited supervision and oversight.
  5. Being more empathetic towards team members and peers.
  6. Coping up with the need for frequent check-ins.

The challenges of the new ways of working may lead to dissatisfaction and disengagement if these are not addressed properly. The people performance system needs the required upgrade to ensure that all the challenges and risks are mitigated.

Organizations, today, need to constantly rethink how they will manage people’s performance if they want to thrive in the age of new beginnings. Here we are listing down key characteristics of a smart people performance system:

Hyper-personalization at the core

Employee experience lies at the center of design philosophy of new age PMS.  Organizations must introspect into their existing performance management systems from an employee experience standpoint.

Restore faith in people’s performance practices

  1. Customized and frequent communication: As the proportion of virtual and hybrid teams grows in organizations, communication will become the key factor for instilling trust and inspiring confidence among employees. Organizations will adopt a frequent and suited style of communication for different groups of employees to nurture trust and keep them engaged in their respective roles.
  2. Reduce bias through a multi-rater process: A multi-rater performance management system will be enabled where stakeholders shall be identified during the goalsetting stage, based on their impact and contribution to critical outcome-based goals. They will not just provide feedback but also be involved in providing performance ratings. The multi-rater system also reduces biases and ensures fairness in performance assessments.
  3. Calibration of performance ratings: The distribution of performance ratings of employees will also have to be reconsidered in new-age people’s performance management to align with new ways of working and new families of roles. Project and virtual cohort-based normalization for different workforce segments will be enabled to ensure parity among the employees irrespective of their mode of work.

Focused team to create an inclusive people performance system

Emergence of people-centric performance center: With the rise in people-centric data, and the emergence of a heterogeneous workforce, if an organization aspires to design a sustainable people-performance system, it must consider a holistic view inclusive of the needs of stakeholders. To do that, employee resources and performance centers as a shared service model will emerge to manage people’s performance.

Leveraging digital

  1. Fully integrated user-friendly system: With increasing digitization, new-age people performance management will not just be paperless, but it will be device- agnostic and it may be accessed using handheld devices on the go. It will have an intuitive, user-friendly interface and a human-centric design of the tool that is easy to understand and adapt to.
  2. Leverage data for actionable insights: A modern performance management system should capture a large pool of data, which may be populated on real-time dashboards to measure the progress on outcome-based goals for continuous performance tracking. The other aspect is leveraging these data points and conducting people analytics for improved productivity, going digital to track performance, provide feedback on a real-time basis using advanced analytical models.
  3. Inculcate feedback by work groups to improve the performance management process: AI-based chatbots could be leveraged to gather feedback along the performance milestone journey.

It is pertinent for organizations to assess the current PMS and its effectiveness with respect to a new way of working and revitalize to ensure higher efficacy, such that it leads to greater engagement and better performance of the individual and organization.

A version of this article was published on 17 March, 2023 by The Economic Times Insights.com