The Top 3 Ways to Optimize Your Performance Management Software

The Top 3 Tips for Improving Your Performance Management Software

An increasing number of companies are turning to technology to step up their adoption of performance management best practices and free up valuable time for HR, managers, and employees alike. Indeed, leveraging the capabilities of HR software solutions can turn a mediocre company into one that is awash in proven processes; tapped into efficiencies; and completely aware and on the pulse of top, middle, and bottom-performing employees. Yet, few companies truly understand how to make their performance management software solutions work for them. Here are our picks for the top 3 tips that can help optimize your Performance Management Software.

HR Software Optimization Tip # 1: Calibrate Your Ratings

Typically facilitated by Human Resources, Rating Calibration is the process of reviewing, discussing, and adjusting individual employee ratings. Designed to help managers more accurately and fairly conduct performance evaluations, ultimately the end-goal is about potential talent identification for attraction and retention purposes. Though calibration causes its share of dissenting opinions (due to distribution models), according to Bersin & Associates' Stacia Garr, "It is important to note that while performance calibration meetings may feature recommended or forced distributions, they are just one optional tool that can be used within them".

Gartner's Jim Holincheck provides another calibration suggestion: performance evaluation ratings that are configured from the "bottom-up". Focused on identifying the best workers through a type of modified 360-degree assessment, "bottom-up" calibration allows for voting statistics (from employees instead of managers) to influence the rating distribution—theoretically based off the idea that co-workers know who has performed over the cycle and who hasn't. The accountability remains with the manager, but the scoring responsibility is largely handed over to other employees. This is due in large part, Holincheck says, to the fact that, "frequently the people making the final calibration decisions may be somewhat removed from actually observing each individual's performance". "Bottom-up" calibration aims to remedy that. Both "top-down" and "bottom-up" calibration can be leveraged out of most any performance management software offering.

HR Software Optimization Tip # 2: Conduct a Talent Review

Once ratings have been gathered by supervisors, distributed correctly and fairly (aka calibrated), and the performance cycle has wrapped up—via integration with compensation management—it can seem like the end of the process until next year. Yet, now is the time that forward-thinking organizations need to move beyond the individual review and into what has been called the Talent Review—an organization-wide assessment of the overall health of the talent throughout the company.

The veritable yin to "calibration's" yang, Talent Reviews are forward-looking, transformative, and quite honestly, one of the best "best practices" in all of HR. Rightfully focused on identifying would-be successors, leaders, and the like, Talent Reviews are the part of the performance management process that looks at development plans, promotional opportunities, and risk management. It can be pictured like a SWOT (Strengths, Weaknesses, Opportunities, and Threats) assessment for the people side of the organization, with all managers contributing to a "9-box" (performance/potential) matrix as a way to highlight what areas of the organization need to be developed. While much of the actual function of the Talent Review will take place outside of your selected Performance Management Software, the gargantuan amount of data needed for the Talent Review process means that an automated system is a necessity. By leveraging the reporting capabilities of your selected system, you'll not only be helping with data delivery for the Talent Review process, but further adding to the Return-on-Investment (ROI) of your application.

HR Software Optimization Tip # 3: Configuration Not Customization

Chances are you don't rate your Sales Managers the same way you rate your Accountants. Indeed, even if you are a part of an organization that has rallied behind the idea of core traits and competencies (i.e. trust, integrity, etc.), each functional area (and possibly down to each individual employee) within your company will have unique performance objectives. As such, the performance management software you selected needs to be fully able to handle all these differences—from different performance goals all the way to different business process flows. If these unique differences between your employees turn out to be unique to your company as well, then the HR software will need to somehow be amended to work for you. That means you need to either configure the software or customize the software code.

While countless authors have espoused this very same sentiment, when faced with this issue for your performance management software—always, always, always, opt for configuration over customization. Not only will this save you from wasting any more precious implementation time, but customizing code is a costly endeavor that will likely require the expertise of highly-skilled software professionals and perpetual software maintenance for the life of the customized performance management software. That being said, certain configuration questions should be answered by your software vendor ahead of time if possible. Namely,

• Will the software configuration specifics set out remain after any software upgrades or will the configuration process have to re-implemented again?
• Are the software configuration options granular enough to handle individual employee alternatives?
• Can configuration options be deployed quickly and without the need for operational software support (i.e. can managers make the necessary configuration changes themselves)?

The Bottom-line for Performance Management Software Optimization

Until very recently, the above elements of optimization could only be met by a very few software vendors. Whether it be because of the Software-as-a-Service (SaaS) boom, or simply market maturity, now organizations can find performance management software vendors that support nearly every aspect of their unique performance management process—while staying true to established best practices. SAP, Saba, Taleo, SuccessFactors, Plateau, Workday and countless others are all responding to the call of performance management software optimization, providing the user-friendly tools that have been so desperately asked for. The only question left is whether your organization should opt for a best-of-breed solution or go with a product suite—but of course that's an issue for another article.

  Categories: Employee Performance Management

  Tags: Performance Management Best Practices

  Permalink: www.hrlab.com/performance-management-software.php

 Author: Micah Fairchild

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