Employee needs and commercial needs go hand in hand: the factors that drive individual performance ultimately drive commercial success for the business. Yet all too often, leadership and human resources’ conversations around employee performance focus purely on its outcomes – commercial KPIs, productivity, output – and fail to address what’s impacting each employee’s performance, and how to influence it.
Here, we break down what employee performance is and how you can drive, measure and assess it, along with some clear steps to improving employee performance in your organisation.
What is employee performance?
Employee performance is, simply, how well an employee is performing in their role, but there should be more to it than output alone. Performance should cover the quantity, quality and value of each employee’s output, as well as their behaviour and efficiency.
Employee performance is a good indicator of the health of a business and its management structures. If every employee is performing at their best, so does the business. If they’re not, the business struggles to achieve its targets – it’s really that simple. In essence, every employee is part of the commercial puzzle: you need every piece in order to have a full picture of how well it's functioning.
Yet when it comes to managing employee performance, many organisations take a one size fits all approach. Instead of seeing each piece of the puzzle, they just look at the bigger picture – they can see that there are holes, but they don’t know how to fill them. As a result, they put blanket policies and initiatives in place to drive better performance, and they don’t work.
Why? Because performance drivers are deeply personal and unique to the individual. Every single employee is different. What motivates one person won’t work for another. A challenge for one team member might be a breeze for another. The things that are important to Sam in accounts could be low priorities for Alex in marketing. Understanding employee performance should really be about understanding individuals – which is easier said than done when you employ hundreds of people.
What impacts employee performance?
This is a bit like asking ‘how long is a piece of string’. What drives employee performance, depends on the employee. It’s a complicated aspect of human resource management, but it’s not an impossible one to deal with once you know how to take a people-centric approach.
In a people-centric workplace, there are three main factors that affect performance:
Inclusive workplace culture
Inclusivity isn’t just a nice to have, it’s a key driver of employee performance. Employees that feel able to be themselves at work, and feel valued for their individuality, are more confident, more able to ask for support when they need it, and more driven to perform their best. Inclusive workplace culture doesn’t ignore people’s differences, it embraces them, recognising that just as everyone brings something unique to the table, so do they have unique obstacles and challenges to overcome.
Happy employees are more productive, engaged, and motivated. If managers are able to look after their team’s wellbeing, and help them to address stress, confidence and happiness, their performance will improve as a result. Yet that wellbeing shouldn’t just relate to how they feel at work: people don’t leave their troubles at the door when they walk into the office or open their laptop, nor do they leave their stresses at work when they leave at the end of the day. Wellbeing that takes the full person into consideration, tackling both personal and professional issues, has the greatest impact on employee performance.
Individual performance drivers
Understanding every employee’s unique circumstances is a big step towards unlocking better performance. If managers can help their reports to identify what really motivates them, they hold the key to unlocking the full potential of their performance.
What are employee performance drivers?
Employee performance drivers are the key things that motivate an employee. They are usually a mix of personal and professional factors, ranging from priorities in their home life to expectations and ambitions for their role. Every employee has their own blend of drivers: if managers can work with them to identify those drivers and the actions they need to take to achieve them, it has a powerful impact on employee performance. A platform that lists these drivers and enables the employee to score them gives structure to this process for both the employee and manager, helping conversations to stay focused.
Examples of drivers range from the personal (including family, partners, pets, health and exercise) to the professional (such as promotion, recognition, development, time management and supportive management). This is just skimming the surface: on the OpenBlend employee performance platform, there are 30 drivers, with employees choosing a blend of four to eight that best represent their needs.
How should you measure employee performance?
If you take a broad-stroke approach to performance, it’s likely that metrics will fall into three areas: quality of work, speed and efficiency, and trust and consistency. The employee will have KPIs based on their output and their attitude to work, which a manager can effectively ‘tick off’ if they are met. If they are not, new goals will be set for the employee to work towards.
However, this approach might look at the outcome of employee performance, but it ignores half of the picture: what are the factors impacting this performance? How can you help employees to address these issues and perform at their best?
When measuring employee performance individual objectives and KPIs are much more impactful, as they set specific targets that relate to the individual, giving them clear goals along with clear steps to achieve them. Just telling someone they should be doing something – eg, increasing their output – without looking at why they are struggling to achieve it – for instance, because of stress, workload, or difficulties at home – is a recipe for failure and frustration.
If you want to improve employee performance across the board, managers should set achievable, specific goals with the employee, turning over-arching ‘performance metrics’ into actionable items and working them into employee development plans.
How can managers impact employee performance?
Managers can impact employee performance through conversation – but they need to be the right kind of conversations, not a coffee-break chat or a rigid performance review. Effective one-to-ones between managers and employees should cover a breadth of subjects, with employees openly discussing their performance goals and motivational drivers and managers asking simple, direct questions about wellbeing that prompt honest responses.
In effect, every manager needs to become a coach, which is no mean feat given that every manager is likely to have a different background, level of experience and interpersonal skills. Training sessions alone often aren’t enough to transform every manager into a coach: they need a framework that enables them to have consistently productive conversations. This framework should include clear goal setting, wellbeing prompts, a way to identify and prioritise individual drivers, and an easy way for managers and employees alike to add to the agenda.
8 steps to improve employee performance
- Make regular one-to-ones a priority: Unlocking high performance always starts with a conversation. By setting regular, consistent one-to-one conversations, both managers and employees will benefit from knowing they have a platform to raise key discussion points, address challenges and issues, and have open, honest conversation
- Turn every manager into a coach: Invest in a framework that enables every manager to become a coach. Not every manager will know how to deal with personal issues, or naturally be good at setting performance objectives and undertaking performance evaluations but with the right structure and prompts, every manager can become a coach.
- Don’t treat performance as a product: If managers are looking at output alone, they’re missing an opportunity to influence employee performance and unlock their reports’ full potential. Employee performance needs a full, wraparound perspective, looking at what’s impacting the employee as well as what they are producing.
- Encourage a collaborative approach to agenda-setting: Employees engage when they take an active role in agenda-setting. By encouraging employees to set the agenda for their one-to-ones, they will be more focused on the outcome of the session and more motivated to achieve the goals that are set, as they will align with their own personal objectives as well as the business’. Likewise, managers need to be able to represent the business by adding their own points to the agenda. This collaborative approach means that both parties get what they need from every one-to-one conversation.
- Recognise wellbeing as a key part of performance: Happy employees are always more productive, and poor performance isn’t always indicative of incompetency or lack of ability. Your employee’s health and wellbeing are key factors in their performance. Make wellbeing a performance metric, and you will see an improvement in motivation and productivity across the business.
- Set, track and measure individual objectives: The best performance objectives are unique to the employee, recognising their personal challenges and ambitions as well as the goals of the business. Enable managers to work with employees on these targets, and create actions that make them achievable and motivating, not unrealistic and demoralising. Managers can then assess performance over the short- and long-term, and HR teams can track overall workforce health and performance.
- Give feedback: It goes without saying that the more feedback an employee receives, the more they will be able to improve. Performance management software should have options to share reactive feedback and constructive feedback, as well as important peer-to-peer recognition.
- Give employees access to the support they need: Enabling employees to access the skills and support they need from across the business is invaluable to skills-sharing and overall workforce development. Ensure that employees have easy access to the right work environment, leadership or peer support that they need to fulfil their targets or work on specific projects through mentoring.
The best thing you can do to improve employee performance is to shift your perspective, looking at what’s impacting the employee as well as measuring their output. The OpenBlend employee performance platform has helped the likes of Gymshark, Lacoste Footwear PCL, Foxtons and Dr Martens to transform employee performance in their organisations.
Find out how they did it: book a discovery call with our team today.