5 biggest mistakes companies make with performance management

Performance management is misunderstood or executed in a clumsy way that can actually harm employee engagement, motivation and, ultimately, performance. Here are the 5 biggest mistakes companies make time and time again.

1. Setting vague goals
Most leaders know that the best goals are SMART goals: Specific, Measurable, Achievable, Relevant and Time-bound. Yet, all too often, goals can be incredibly woolly.

2. Not dealing with under-performance
Managing under-performance is tricky and no manager enjoys it. This means it’s often swept under the rug and ignored. Sometimes metrics are even manipulated to give the impression that everything is fine.

3. Not recognizing, celebrating and rewarding good performance
Just as low performance is often overlooked or ignored, sadly, good performance often goes unrecognized. This can leave employees feeling unmotivated and disconnected from the business’s common purpose.

4. Not ensuring your people understand the big picture
Too many companies fail to make their employees aware of the bigger picture around performance management. To feel empowered and invested in a common purpose, employees need to understand what direction the company is moving in, and what goals it is working towards.

5. Using performance management tools to micro-manage and control
Done well, performance management should empower your people, not be used as a system to control and micro-manage them.

Employees who are invested in the performance management process, and who understand the bigger picture, feel a greater sense of trust, authority and accountability.