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Is your company advancing its performance management program? Here’s how to find the best performance management software for your small to mid-size enterprise.

As organizations grow and evolve, most leaders mature their policies, processes, and systems to adequately support the business at scale. Many small and mid-sized enterprises, for example, evolve from simply conducting annual performance reviews to a broader, more proactive, performance management process that tracks and measures employee performance throughout the year. As they do so, most will install or upgrade their performance management systems to help align employees’ performance with the company’s priorities, strategies, and goals.

In a recent blog, we highlighted several benefits of performance management tools. Now, we’re taking the exploration one step further, to share the system capabilities that are best-suited for companies with 100 to 1,000 employees. The trick is to find a system robust enough to support your program yet simple enough for employees, managers, and HR administrators to use. Here’s how to find the best performance management software for your small to mid-size enterprise.


Understand Your Performance Management Process, Needs, and Resources

Start by outlining your performance management process – or the process you aspire to have in place. Most organizations create or update an annual performance plan for each employee. Ideally, your employees and managers are reviewing the plan throughout the year, with the ability to capture notes, experiences, feedback, and milestones. Performance assessments may happen at any time. Formal performance reviews, a retrospective look at performance compared to the plan, typically occur annually. Career paths and plans, training and development plans, succession plans, and learning and development activities all play into performance management. Ideally, all have ties into the performance management system you use.

Before shopping for your next performance management system, take time to assess your needs and resources. Be honest about your team’s technology savvy. Do you have an in-house IT support team? Or will you need expert support from a performance management technology vendor? Also assess whether your human resources team is well-equipped to advance its performance management program. If the move is a stretch, look for a performance management vendor who is readily available for consultation and guidance as you define or improve your program.


Create a Checklist of Performance Management Tool Capabilities

There are many performance management systems and tools on the market today, with a broad range of capabilities that can be overwhelming. Once you’ve articulated where you are with your program and resources, create your performance management system capability checklist to help you focus on what you really need. You’ll want to choose a system that primarily, and easily, lets you do what’s most important to your program and company.

Here, in no particular order, is a quick checklist to get you started.

  • Hiring or Opening Management. Hiring implies an external process to fill open positions, but many job openings can be filled from your current workforce. So, some performance management tools refer to the capability as opening management. Whatever it’s called, look for a system that supports filling open positions. Ideally, you’ll be able to view the record of the person who sat in the seat before. Also, some systems support exit interviews to help define the profile for who is the best fit for the job.
  • Job Descriptions. The best job descriptions are updated regularly – and certainly updated whenever hiring or moving someone into the open position. Some tools have automated ways to create job descriptions if the job role and competency data is populated. Be sure your performance management system supports job descriptions clearly tied to required and desired skills and competencies, to keep candidates and managers focused on the elements that matter most for success. Look for systems or tools that allow for optional educational background – especially if your company is no longer requiring college degrees for many of its positions. Think, too, about whether you want employees to easily view job descriptions in other parts of the company, to see potential career paths that may be adjacent to the work they’re doing now.
  • Performance Appraisals. Especially this time of year, many employers are completing annual performance reviews designed to document performance for the last year and align the employee and company for next year’s goals. Performance appraisals are different. These are more frequent “checkpoint” conversations between employees and managers to review recent activities, to assess current plans, and to adjust the plan based on changing employee career aspirations, company priorities, or new opportunities for development. Many companies make performance appraisals a standard monthly or quarterly activity.
  • Performance Reviews. Unlike performance appraisals, performance reviews are typically end-of-year reviews of the past year’s employee performance measured against the objectives from the performance plan. It’s meant to be a strategic, longer-term view of how well the employee is contributing to the company’s success and moving along their career path. Often, these conversations encompass compensation – merit raises for the next year – though the money talk too often overshadows other feedback and an increasing number of companies are wisely separating the two discussions.
  • Employee Engagement. Employees want to do work that matters for a company that cares. They want to grow and to be recognized for their contributions. The best performance management programs – and systems – give employees instant visibility into how they’re doing. Look for a performance management system that is meant to be accessed by employees and managers throughout the year. It should be user-friendly and easy for employees to monitor milestones as they are achieved, document and review feedback from colleagues and customers, and see where the employee is on their career path trajectory. Some performance management tools have built-in performance journaling features, giving anyone the ability to comment on another employee’s work, capturing a moment or milestone that won’t be overlooked months later.
  • 360 Feedback. Many companies overlook opportunities to assess their managers. Too often, strong performers are promoted into leadership roles without the training and support they need to lead a team. Yet, when employees quit a company, they are more often stepping away from a bad manager than a bad company. 360 feedback gives managers – and their managers – a better sense of how well leaders are managing their people and projects, how well they collaborate with colleagues, and how well they serve their superiors. It’s an important set of feedback that helps identify skills gaps and areas for development. Look for performance management systems with 360 feedback capabilities, so managers – and their teams – get the support they deserve to do a complex job well.
  • Key Performance Indicators. KPIs can be excellent measures of how well employees are performing certain tasks. A robust performance management system will support a library of tasks or skills as well as the ability to define the level of competency an employee should strive to achieve for each.
  • Independent Development Plans. IDPs are the career planning maps for employees. Most have career objectives along with a learning and development plan designed to move employees from where they are today to the next (and the next) step along a desired career path. Find out how (or whether) the performance management system supports IDPs.


Select the Best Performance Management Software for Your Business

Armed with your checklist, you’re ready to start evaluating performance management tools and systems to find the one that best fits your organization.

Ask for a demonstration or pilot. Don’t get distracted by bells and whistles that you don’t need. Pay attention to frustrations such as clicking on features that aren’t available in your subscription. Or trying to set up a feature that’s difficult to figure out. Or difficulty securing the support or guidance you need.

When you get close to deciding, talk to others who use the vendor and its software to understand what level of customer service and technical support you can expect.

Look for vendors who have worked with companies like yours to address the workforce issues you’ve prioritized. Ultimately, you’ll want to find the performance management product and partner that can provide the features, support, and guidance you’re looking for.


Ready to discover and select your next performance management system? Review our Competency Management Toolkit for tips on a competency-based approach to performance management. Or contact us to find out whether Avilar’s WebMentor Skills™ could be the best performance management software for your organization.



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