1) How does performance management software help improve company performance?
Leadership opinion at Fortune 500 companies has consistently stated that company productivity and profitability is directly related to workforce quality and employee productivity.
Studies also show that companies that invest in their employees, aided by modern technology like performance management software, display best-in-class numbers across KPIs such as company-level profitability, productivity, reduced labor turnover, and employee satisfaction. As a result, employee development is one of the biggest focus areas of companies, especially in today’s age of hyper-competition.
Not only is it important to train new employees but equally important to manage the training and development needs of current employees. In doing so, employees and companies can align their goals, set common targets, and stay unidirectional toward accomplishing better results. As mentioned above, an important tool for measuring employee performance and productivity is performance management software.
This blog will focus on the top ways that performance management software boosts productivity and profitability.
2) Top 9 reasons businesses need performance management software
i) Attracting top quality talent: Well, it is an obvious truth isn’t it? Unless you can attract and recruit the best workers out there, your company will struggle to achieve optimal performance.
Companies that make a concerted effort to manage employee performance and offer them growth prospects will achieve maximum employee satisfaction. As a result, these companies hold a premier position among the best talent out there. In turn, these employees are top performers that boost company performance. And thus, a mutually benefit equation is maintained.
ii) Re-training and up-skilling existing employees: Extending the point above, it is important for companies to constantly work with existing employees to put them through regular training and development programs.
Performance management software helps in tracking employee deliverables vs. skills required. Also, as an employee progresses in his career such analysis keeps evolving. Using the software as a base, business managers, HR teams, and employees can ensure a common understanding and need for such re-training.
~~~ 360 Degree Feedback ~~~
360 Degree feedback is an increasingly popular way of employee appraisals, and Performance Management Software is a great tool for conducting it. This also helps with employee recognition and training needs.
iii) Creating an engaged workforce: Companies the world over suffer from employees that become demotivated at their jobs, and therefore, disengaged.
Workforce engagement is a premier driver for employees to excel at the workplace. It is a cornerstone to building a sustainable workforce.
Using performance management software, companies can hone in on employee motivators – or, motivator killers – and ensure that their career goals are aligned with the company’s. This ensures alignment and provides a fillip to productivity.
iv) Reducing labor turnover: While there exists a school of thought that skilled workers are more likely to move jobs faster, studies have shown that when companies invest in developing their employees long-term, the turnover is lowered.
An important step is to be on the same page as the employee about his personal development needs – and, the first step toward that is the robustness of a performance management system. One that is clear and gets buy-in from employer and employee, both.
v) Building future leaders for the company: Building on the point above i.e. reducing labor turnover, the next step is to assess employees and their potential for future growth. After all, new leaders need to be groomed to take over from the earlier set.
Succession planning must be a well-planned and executed process that analyses leadership requirements as companies look out into the horizon. That helps companies to plan for required positions over a period of time.
Performance management software is a critical step in such succession plans. Through regular performance appraisals and development needs, companies can identify a core group of employees to assume leadership positions in the future.
vi) Workplace diversity: This is another key benefit that the software helps deliver. Modern workplaces particularly emphasize workplace inclusivity and diversity. It is also a key aspect that younger workers consider.
With comprehensive performance appraisals, HR teams can now identify pools of workers that meet such criteria. Often, analysts on Wall Street also ask for the break-up of a company’s workforce so that shareholders are satisfied.
~~~ Performance Management Software provides numerous features for employee development: real-time feedback, goal-setting, rolling reviews, 360-feedback, and performance analytics help companies manage employee performance in a fair and comprehensive manner ~~~
vii) Employee recognition: At the end of the day, employees are human beings. And, to feel valued is one of our most basic needs. Performance management software provides deep insight into the type of rewards, recognition, and appreciation company employees seek. Studies indicate a direct correlation between employee recognition and employee productivity.
While monetary benefit is always at the top of the list – since we all have bills to pay! – it isn’t the only significant reward. Feeling valued by peers (e.g. through a Peer-Appreciation- Certificate for a job well done) is an example of how the system can collate feedback from employees and employers to come up with an effective employee recognition and reward program.
viii) 360-feedback: This method of employee appraisals has become increasingly popular. Here, workers receive feedback from “360-degrees” of interaction i.e. their managers, as well as from other colleagues such as peers, direct reports, and dotted-line team members.
This method requires attention to detail and proper execution and performance management software is a great tool for achieving this. Not only does it help analyze employee performance but it also provides invaluable robust data for their training needs. This helps greatly improve employee productivity.
ix) Goal alignment: Unless company goals and that of their employees are aligned to be unidirectional, there will be cross-purposes. Remember, an organization is a collection of people, resources, work-streams (etc.)
Therefore, using performance management software is paramount – it aligns employee goals and the way they envision their careers with that of the company. It is also a forever fluid process and needs constant re-visiting and monitoring. The software is a great tool for managing such complex workstreams.
Conclusion: Using performance management software to improve employee performance, and hence productivity, is an integral part of a company’s effort to achieve a sustainable and profitable operation.
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