Continuous Performance Management leads to higher employee engagement

  • October 12, 2023

Continuous Performance Management (CPM) is a concept and a way of life for organizations who believe in contributive and consultative growth. This trend has found support from HR officers and business leaders of market-leading organizations worldwide. From being a transactional process, CPM has turned performance management into an employee-centered process. It aids personal development, provides job autonomy and motivation, which leads to higher productivity.

Continuous Performance Management has a direct bearing on P&L: According to a 2023 Gallup report, unhappy and disengaged workers cost the world $8.8 trillion. This also throws light on the fact that the primary reason for low engagement is the feeling that employees can't change the work scenario with respect to their immediate supervisor or the role that they play in the advancement of the company. It's therefore imperative that the company's culture be centrally inclusive, and purpose-driven. After all, 'culture' is as essential to recruiting and retaining employees as product is to marketing. Evidently there's a financial cost to reduced productivity, which in turn impacts on the bottom-line.

Collective productivity equals organizational success: The productivity of a work group is directly proportional to how the group members see their own goals in relation to the goals of the organization. It's important to note that team leaders have the power to gather talented teams and deliver results. However, the question is about those employees who are farthest from the boardroom. Do they share a sense of purpose and feel involved?

Meeting business profitability targets is a team sport where top-down feedback opens pathways to feed forward. This is instrumental in leaders playing their part in moving forward, achieving collective goals in a dynamic environment and not dwelling in the past. Higher involvement and feedback plays a vital role in higher productivity. Organizations that are ranked high on employee engagement tend to be 23% more profitable as compared to their peer companies.

Being SMART is being consistent: Continuous tracking of work projects also gives team members a rearview mirror report on how they are working toward the objectives set at the start of the year. This practice also ensures alignment with what the organization wants to achieve and how an individual employee can make a difference. It's therefore important for one’s objectives to be SMART (specific, measurable, attainable, relevant and time-bound). This helps identify and determine what success looks like and by when.

Magnitude of turnover intent: The employee/employer relationship is a two-way street and usually it sets the tone for fair practices, compensation and growth opportunities. Continuous Performance Management is reflective of organizational commitment towards employee development. It also creates psychological attachment and reduces the magnitude of turnover intent. Higher organizational commitment to its workforce usually translates into employee willingness to continue at their current workplace by almost 18%. Recruiting and selecting new employees and loss of sales due to inexperienced new hires are the costs of turnover in an organization; therefore in HR management, turnover intent has serious implications.

Post-pandemic work imperative: The pandemic forced us to move out of our comfort zones regarding established annual models and the monologue-driven performance appraisal system. Remote work highlighted the need for better communication and more feedback as we weren't in the sanctuary of our office space. That gave birth to the seed idea of Continuous Process Management.

From an engagement and development standpoint, organizational attention has shifted to continuous performance development, which focuses on frequent feedback and career coaching rather than only looking at performance once a year. By having a year’s worth of input from multiple sources, we also remove recency bias, where we tend to remember things that happened a month or two ago and base performance on that only.

Continuity vs annuity: Continuous performance allows individuals to improve their performance based on the feedback they receive on an ongoing basis — without having to wait an entire year to make adjustments and have those recognized. Continuous performance still looks at performance against objectives, but it shifts us to a culture of continuous feedback and career development versus one-time annual reviews where employees received a rating. Ratings can be subjective and don't tell the full story of the contributions, impact and influence a team member has driven in the past year. Getting input throughout the year allows individuals to develop themselves continually and not periodically.

Finally, there's a saying which has stayed with me: “With the wind in our favour, we can control the direction of our career, with continuity we can sustain the pattern of excellence.”

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Amir Durrani

Amir Durrani is executive vice president of Digital Operations, responsible for ensuring that our global delivery model continues to remain a competitive differentiator through our expert talent, delivery excellence and client focus. He leads a team of over 30,000 professionals, charged with developing and delivering innovative solutions that accelerate the business transformation for our clients. Amir has more than 30 years of experience in the IT services industry, including serving as executive vice president of Asia Pacific and EMEA at Keane, Inc.


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