How to measure employee performance

How to measure employee performance

Employee performance – the easy way to measure

It’s often said that a company’s most valuable assets are its people. If that’s true, you need to know how well they’re performing. The process of evaluating employee performance is a well-developed science, but it’s worth reminding ourselves why this process is important.

Why measure?

In a broad sense, having a clear idea of how staff are performing gives you a valuable snapshot of how the business is faring. Are some departments doing better than others? Is there a production blockage in the system?

On an individual level, focusing on performance can help employees achieve their potential, which improves morale, which improves productivity and so on, in a virtuous circle.

Finally, of course, poor output means unhappy customers, and no one wants that. So how do you measure employee performance? Let’s look at four of the most common techniques.

Objective Key Results

This is a very straightforward way to measure employee performance. Put simply, it involves setting goals with measurable results. Generally, objective-setting is a collaborative process, involving employer and employee in discussions. The objectives themselves may be challenging, but they must be achievable and the criteria for success must be clear. On the way to achieving an objective, key results are used to benchmark and monitor progress. They are specific in terms of outcomes and time. For instance, “I will increase customer uptake by 15% within six months.”

Performance Appraisals

A more subjective method, performance appraisals consist of regular reviews in which the employer (or line manager) assesses the employee’s performance over a set period. Targets and goals can be set for the future, but ultimately, this is an opportunity to sit down and talk about where the individual wants to go, and how well they’re progressing towards that goal.

360-Degree Feedback

An extension of the appraisal system, 360-degree feedback invites comments from several of the employee’s colleagues and, in some cases, customers. This allows for a different perspective – not all feedback comes from above. Much of it comes from peers and external clients. As a result, it can often reveal issues that a manager might not be aware of. The individuals invited to provide feedback may be chosen by the employee or manager – or agreed by both – and all comments can be anonymised, allowing for a greater degree of frankness.

Key Performance Indicators (KPIs)

A KPI is a specific metric that indicates success for an organisation or employee. It’s an excellent way to express an overall vision in terms of an individual’s activity. Whatever targets you want your business to meet can be reflected in staff KPIs. To be effective and fair, KPIs should be SMART: Specific, Measurable, Achievable, Relevant and Time-Bound. In performance appraisal, they can be set by managers, or they can be agreed with employees. The key advantage of KPIs is that you can tell at a glance if they’ve been met or not.

The field of performance measurement is complex, and fraught with difficulties. HR regulations and employee legislation need to be considered, along with staff morale and engagement. A simple route through these issues is to engage the services of a specialist. ADP offers an employee performance software system called, which gives you all the tools, data and dashboards you need to do the job quickly and efficiently. Everything you need to know is visible at a glance, so you can be sure that you’re getting the most out of the process.

And if you’d rather not deal with it at all, you can outsource the whole thing. ADP experts are on hand to take care of all kinds of HR systems, including performance measurement. You can be confident that everything is effective, compliant and smooth, keeping the needs of the business and employees firmly in mind.

 

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