Employee engagement is one of the key ingredients for achieving high performance. Research has shown that highly engaged employees perform 20% better and that those organisations with the most engaged employees are, on average, 22% more profitable. It make sense then that our performance management processes should be designed to improve employee engagement as much as possible.
To do this, we first need to understand what employee engagement is and what leads employees to be engaged. There are a number of different theories and models of employee engagement, but our preferred one is that put forward by the entrepreneur and business writer Kevin Kruse, as it is aimed at managers who are on the front line of performance management. Kruse defines employee engagement as:
The emotional commitment an employee has to the organization and its goals.
His conclusion from analysing existing research on employee engagement is that it can be boiled down to 4 things:
- Growth & Development
- Recognition & Appreciation
- Trust & Confidence
Let’s take each of these in turn and consider how performance management processes can be designed in order to maximise them.
Kruse: There should be frequent, consistent two-way communication
Regular one-to-ones are the best way to achieve two-way communication within a performance management context. Kruse advocates that line managers should meet with each of their team members for a 15-30 minute catch up on a weekly basis. Deloitte has recently adopted this approach and its managers are expected to have weekly ‘check-ins’ with each of their staff. The key to success here is ensuring that the discussions are two-way rather than the manager simply dictating priorities. Providing employees and managers with a suggested agenda for these meetings can help in this respect.
Growth and Development
Kruse: Team members should feel like they are learning new things and advancing their career
Growth and development can be achieved through managers and employees spending dedicated time discussing career goals and building a personal development plan that will help to build the necessary knowledge, skills and behaviours to achieve those goals. Many organisations do this once a year as part of their annual performance appraisal, but Kruse suggests that it should be done twice a year to maximise employee engagement. Either way, it is important that progress against personal development plans is regularly reviewed throughout the year rather than the plan being put away in a draw until the following year. Our performance management system helps with this by showing employees’ personal development goals alongside their performance objectives to ensure that they are given sufficient visibility and attention.
Recognition and Appreciation
Kruse: Team members need to feel appreciated and that their ideas count
This is where frequent feedback is essential. Your performance management processes should incorporate ongoing, regular feedback, at least every fortnight, rather than managers saving up feedback for formal reviews or relying on yearly 360 degree feedback processes. Of course, recognition and appreciation is about giving positive feedback and saying thank you. So managers should be encouraged to give the right balance of positive to constructive feedback – research suggests a ratio of 3:1 is about right. For the positive feedback to be meaningful, the person giving the feedback should explain the impact that the action or achievement had upon them personally or on the team or the organisation. Kruse adds that saying thank you to a person in front of others (e.g. in a team meeting) will magnify its impact.
Trust and Confidence
Kruse: Team members need to trust the leadership and have confidence in the organisation’s future
This might seem to be outside of the scope of performance management, but an important aspect of building this trust and confidence is openly sharing the organisation’s plans and goals for both the forthcoming period and the longer term. For this to have an impact, the organisational goals need to be communicated in a language that employees can understand and relate to. To get employees to relate to those goals, ask them to come up with their own objectives that will help to deliver the organisational goals, rather than cascading objectives down to them from above.
Another aspect of instilling trust and confidence is ensuring that your managers lead by example when it comes to performance management behaviours. Managers who devote regular time to discussing performance and personal development, who give frequent, positive feedback and who adopt a coaching style of management are likely to gain trust and respect from their team members. So train your managers in these skills, starting at the top of the organisation with your senior leadership.