Rethinking Performance Management for the Digital Workplace

Performance management is transforming in the digital workplace to support more frequent, contextual and transparent feedback to employees.

The idea of abolishing the annual performance review has been discussed, adopted, reversed, reinstated and modified many times across thousands of organizations over the past 50 or more years, and continues to make the news today.

According to Yvette Cameron, research director at Gartner, the performance review isn’t going away, despite its flaws and often reviled status. Organizations fundamentally need a way to evaluate and communicate who is performing well and who needs to be let go, to identify development opportunities and to determine how to pay employees for their contributions with a somewhat equitable or at least defensible approach.

“The effectiveness of traditional performance management processes, however, is questionable and satisfaction levels are low. When added to the increasing demands of the digital workplace, it is clear that organizations need to rethink their performance management processes and technologies to leverage a more consumerized work environment.”

Regardless of underlying drivers, the performance management process in the digital workplace is being re-evaluated at each of its component parts, as organizations seek new ways to improve employee alignment, performance and engagement.

Need for continuous, engaging approaches

Across the globe and driven by the demands of the digital workplace, the roadmaps of human capital management technology vendors reveal heavy investments in new performance management approaches. Tools are emerging that supplement documentation and compliance requirements with the ability to focus on the continual process of performance improvement, fostering collaboration, transparency, regular feedback and guidance to employees in the context of their daily work activities.

Annual performance reviews will be replaced by frequent feedback and coaching, leaders will be held accountable for employees’ career collaboration, particularly through new agile performance management practices.

Increased feedback frequency

To meet the demand for more frequent feedback, organizations will need to rethink what employee performance metrics are set and how they’re communicated. Trends in gamification and the consumerization of enterprise applications will drive demand to include employee performance metrics in performance management tools, and enable employees to share individual or team results with management, other team members or as a public achievement that they would like to make visible to others in the organization.

For many organizations, this would represent a significant change in culture, exposing accomplishments, actions and other aspects of performance beyond the silo of the employee-manager relationship. It would also be a significant change in terms of enabling employee self-service analytics within business applications, and enabling the results of those analytics to be sent to other applications to facilitate performance management discussions.

Gartner clients can read more in the report ‘Rethinking Employee Performance Management in the Digital Workplace.’

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