Performance management in 2021

Elissa Dennis
5th January 2021
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Making predictions is a dangerous game. As any gambler knows, anything can happen and even the firmest of favourites is never a dead cert. At the start of the year, the big business story for 2020 was going to be Brexit and what terms the UK would leave the EU on. While this did finally make the news in December, Covid-19 arrived to completely disrupt every organisation in the country and fundamentally change how businesses work.

The impact of remote working and social distancing has touched every business, forcing them to rethink how they operate, their relationship with employees and what the future will look like. How to ensure employees who are working at home, physically separated from their teams and other colleagues, can be as productive as possible is a question that has suddenly leapt to the top of every senior leader’s agenda.

While we can’t be sure exactly what 2021 has in store, the lessons from the last 12 months are likely to shape how businesses approach performance management and what changes they adopt.

The last rites for the annual appraisal?

Performance management has been thrust into the limelight. While the move away from the annual appraisal has been going on for some years, the shift has been slow. The pandemic has been a catalyst to really get businesses engaged with the need for a more continuous approach.

Employees need objectives that are relevant, that relate to their current situation. Line managers need to stay in touch with their direct reports and ensure they know what they should be working towards and how to achieve them. Businesses need their teams to be aligned so that everyone is working towards the same goals.

This has required HR, senior leaders, and managers to embrace shorter review cycles and introduce more frequent check-ins. This process will continue in 2021 as employees and managers become more comfortable with this approach, with performance management becoming much more relevant to day-to-day activities, providing a useful framework for manager and employee to embrace and not something to be dreaded at the end of each year.

“If businesses have not already done so, I think that in 2021 they will need to re-think the way that they review the cycle of an employee’s performance and also their wellbeing”, says Neil Wainwright-Farrar, Head of Learning and Development at Clarity. “We have decided to move away from the usual “yearly appraisals” and move to regular check-ins, to review an employee’s progress towards objectives set, aligning new objectives where required, making the whole employee experience even more positive whether they remain office based, or home based”.

Focusing on more than performance

One thing that the pandemic provided was an opportunity for organisations to stop and reflect. It’s not often that you get a chance to step back from a situation and look at it with fresh eyes. Some of our customers paused their review cycles, taking the chance to consider what was most important to support employees during the difficult months of the first lockdown, with many juggling childcare, health concerns and worries about the future.

Employee wellbeing became a huge focus and the link between performance and wellbeing was highlighted for all to see. We developed our working from home check-in form in response to demand from clients which gave managers a clear framework to review performance alongside how employees were doing in one simple document. This has proved to be very popular and many organisations will continue to ensure that wellbeing is being assessed along with performance in their reviews in 2021.

“We normally have face to face reviews in April, but this was not possible in 2020”, says Lisa Rose who works in Human Resources at Aldenham School in south Hertfordshire. “When we came back in September, we opted for a mini review to ease staff back into the process and focus on their wellbeing, which is vital in an organisation like ours. Ensuring that we maintain a covid-secure environment is an extra pressure on staff. If they are to perform to the best of their abilities and maintain the high standards expected of them, we need to reassure them that we are here to support their health and wellbeing.”

More employee-driven learning

This year has forced many people to think about themselves and their careers. It has given them an opportunity to reflect on what they’re doing, think about whether they are happy in their role and consider the future. Performance management in 2021 needs to be more focused on helping employees develop the skills they need, both now and in the future. It should empower employees to take control of their own learning and development, tracking their progress and connecting more closely with talent retention and succession planning initiatives.

Companies can take advantage of this new-found curiosity and desire to learn”, says Rachel Arts, Director of Learning & Development Consultancy, Talentstorm. “However, they should be aware it needn’t be a race for them to churn out their own content. There really is lots out there already, giving their people the skills to self-direct and manage their own learning is the key. Building in frameworks as part of their approach to performance management, such as a coaching option that focuses on personal development is an approach that we’ve been piloting effectively at Talentstorm.”

Getting managers up to speed

Line managers have been under huge pressure this year, not only to manage their own performance in difficult circumstances but that of their employees too. Research suggests that 2020 has been the most stressful year in history.

An effective performance management system relies on managers buying-in into the process and having the skills to execute their role effectively. Many will have never managed a remote workforce before and have very quickly had to deal with new circumstances and adopt new ways of working. Also, if an organisation is changing their approach to include more frequent check-ins, line managers may need training to help them understand their role and what is required of them. It is not fair or realistic to expect them to instinctively know what to do.

“The changes we’ve made to our reviews, making them more light touch and clearly focused on objectives, job descriptions and wellbeing has highlighted training needs for some managers to perform these more effectively”, says Lisa Rose. “We recognise we need to address this to ensure everyone has a positive experience, so will be concentrating on offering specific training for managers to help them acquire the new skills that they need.”

As a vaccine for Covid-19 begins to be rolled out, there is renewed optimism that 2021 will be a brighter one, despite the current lockdown. The companies that enjoy the most success will be the ones that take the lessons from 2020 and adapt accordingly. Enabling people to perform to the best of their ability needs to be about creating the right conditions and support for them to thrive in. This means ensuring they are in the right frame of mind, have clear direction, regular updates and the necessary skills to succeed.