Tag: Performance Management

Employers Survival Tip #4

Establishing Performance Standards to Achieve Success

Competitiveness, profitability and growth are rooted in the ability of your human capital to execute your strategy. Setting benchmarks for what constitutes success, measuring performance against those benchmarks and finally, rewarding achievement are keys to maximizing the potential of your employees.

So what factors contribute to low performance, low productivity and lack of business success?

Lack of communication, or improper communication greatly contribute to low quality performance and low productivity. Business owners and customers tend to assume that employees and managers see things the same way they do but in reality, not many employees think like business owners because they don’t have the same goals for achievement as an owner does. Creating a crystal clear set of performance standards and communicating it effectively to your employees is the key to business success.

Time Barriers

Unfortunately, due to limited time and resources, businesses owners are typically too busy just focusing on revenue generation, operations and keeping the business growing to really focus on the people that make it possible. Subsequently, small businesses consistently fail to transition to the next level and succeed to their potential. Performance Management is a necessary function of every business to invest the time necessary to accomplish what needs to be done.

Making the Complex Simple

Managing performance involves many complex factors, but can easily be accomplished and scaled down to meet the needs of a small business within the time and resources available to most small business owners. The following steps are foundational to an effective performance management strategy:

  • Determine what needs accomplished, when and who should be responsible
  • Set short term and long term goals, corporately, by department and then individually and break them into small steps
  • Set measurable standards for each goal and make it clear what defines success. Ensure there is consistency between employees with similar duties
  • Communicate in writing what is expected from your employees. Have the employee(s) sign the performance plan. Encourage the employee to take ownership of the goal and be open allow the employee the freedom to choose how to best succeed, within certain boundaries of course
  • Monitor performance on a regular basis, even before the goal is due to determine progress and make adjustments as necessary
  • Avoid linking performance to pay increases or bonuses unless you set up a specific compensation for the performance plan
  • Recognize achievement and completion of goals – recognition drives future performance

Start with the big goals and break them into small goals. Set up a system to review your goals regularly and make adjustments as necessary. Always communicate your goals to your employees and get that “buy-in” factor in place.

Performance Standards Provide Liability Protection

Additionally, failing to set performance goals and measuring performance opens the doors for employer liability. When you have clear documentation illustrating an employee’s shortcomings as compared to organizational/individual goals and objectives and subsequently, to other employee’s performance, you stand a much better chance to defend claims or lawsuits associated with wrongful termination and discrimination.

The primary purpose for goal setting is for everyone to individually succeed, and for the business objectives to succeed. By measuring performance against reasonable goals, the weaknesses in your team will stand out. You can then begin the process of strengthening the weakness or eliminating it.

Employers Survival Tip #2

Give Your Employees the Road Map They Need So You Can Succeed

With limited payroll dollars to work with, you can’t afford mediocre job performance from your employees. Below standard performance is unacceptable in a tight economy and without clear guidelines, your employees may never hit the mark. You need top performers in your circle along with the ability to measure what they are doing and how their performance affects your bottom line. Many factors can dictate how effective an employee’s performance will be but if you fail to set clear guidelines as to what your expectations are, you are guaranteed to have “C” level employees instead of “A” list performers.

Employees want to know what their job is and what your expectations of their performance are. Additionally, they should know what your company values are, where you are going as a business and how they fit into the picture. A simple Job Description can be the road map for your employees to perform at their optimum level and help take you where you want to go with your business. It can also help separate the wheat from the chaff and give you the freedom and confidence to make tough employment decisions when you’re facing a difficult termination.

A good Job Description should describe the mission and values your company espouses. It should document basic information such as start date, exempt or non-exempt status, hourly or salary, pay rate and job title. Detailing all the particulars of a position will avoid ambiguity and provide the measurement by which employee performance can be compared.

Effective Job Descriptions should be designed to provide you, your managers and your employees a clear understanding of how each job fits into your overall operations, and how it contributes to the achievement of your company’s mission.

Job Description Components

Following is a quick look at the categories that make up a well-written job description:

  • Title of the position
  • Department/Division
  • Salary or hourly
  • Exempt of non-exempt
  • Rate of pay
  • Overall responsibility
  • Key areas of responsibility
  • Measurable performance expectations
  • Reports to whom
  • Consults with whom
  • Qualifications required
  • Company mission and values

A Job Description should be presented as part of a Job Offer to new employees or can be developed at any time for existing employees. They should be analyzed, updated and discussed with employees on a regular basis or when the job requirements change. Job descriptions provide clear and comprehensive written recruiting guidelines and clarify performance expectations, which can help you attract the right employee and retain the best performers.

Job Descriptions as a Legal Defense

Job descriptions are important should you need legal defense against discrimination or wrongful termination claims or even to fend off an unwarranted unemployment claim. This means that you’ll need to avoid any language that could be construed as discriminatory or in any way dilutes the “at-will” status of the employee. Accuracy as far as exempt or non-exempt status is crucial to prevent overtime problems and keep you out of labor board hearings.

Getting Started

It should be clear, wasting time managing poor performance will drain your profit and distract you from the efficient operation of your business. Don’t delay this important part of being an employer because it sounds complicated or seems like your company is too small. No company is too small to develop accurate Job Descriptions for their employees. This simple task will benefit you, the employees and the future of your business.

Champion Employer Services offers Job Description advice and assistance as part of its HR Outsourcing program. Contact Champion today for more information.