Human resource is an agile field that’s always evolving. It’s this agility that makes it easy for HR systems to make a real difference to employees. Employees’ work-life balance, well-being, and productivity are largely dependent on the systems that are set in place by HR teams.
That’s why it’s important to keep an eye out for emerging performance management trends and to find efficient tools that can streamline existing processes. The proper utilization of performance management tools leads to more efficient and engaged business processes.
But what are performance management tools? They are types of HR software that enable organizations to track employees’ performance in a consistent and measurable way. Performance management software ensures that cross-functional departments work efficiently and collectively toward achieving organizational goals.
Performance Management Tools that Contribute to Organizational Growth
Performance appraisals and evaluations have become something that businesses either dread or look forward to. They have long been accepted as aspects that are part of business operations even though a lot of people have no idea why.
The implementation of performance management solutions can make or break an organization. So its importance goes beyond evaluations, compensation, and promotions. There are a lot of performance management tools designed to make it easy for organizations to track and manage business performance. We will give you a detailed discussion below of some of those tools.
1. Compensation Management Software
What is compensation management software? It’s a dedicated planning system that streamlines employee data and budget planning. This helps organizations with the creation of optimum employee compensation packages.
Compensation management systems are used by organizations to manage salaries through administrative dashboards. You can also use them to develop matrices and reports on the organization’s compensation data. With IBM incentive compensation management, you can automate the process of calculating, reporting, and analyzing variable-based pay.
This solution is best suited for businesses with high data volumes, large payee populations, and complex incentive compensation plans. Compensation management software is commonly implemented by HR departments, and managers use it to develop streamlined compensation strategies for their teams.
This software can be implemented either as a standalone solution or as part of an integrated HR management suite. A lot of compensation management systems integrate with PMS to incorporate employee performance data into compensation decisions.1
2. Key Performance Indicator (KPI) Measurement Tools
KPI software is used by organizations to track key performance indicators in real-time. The software presents users with KPIs in an easy-to-understand data visualization, which enables them to spot trends at a glance.
This makes it easy for organizations to set measurable goals that align with their objectives. They’re also able to keep track of their progress in meeting these goals.
The KPI software works by users entering their data into the system. They can alternatively connect the platform to their existing technologies and wait for the software’s response.
This performance management system collects data in real time. It then turns it into beautiful dashboards while simplifying reporting into forms that make it easy for you to get an overview and insights at a glance.
Instant alerts when KPIs dip below and spike above certain thresholds help organizations maintain a steady course of operations. Key performance indicators software is mostly used to track finances. But that’s not the only reason to implement them because this software can do anything from monitoring your product’s quality to tracking supply chains and measuring customer satisfaction.
You must, however, remember that there’s no one-size-fits-all approach when it comes to tracking key performance indicators.
3. Reward and Recognition Programs
Good performance by employees must always be praised and rewarded. When employees feel that their hard work and performance are not recognized or rewarded, they tend to get demotivated. This causes them to deviate from the organization’s overall objectives.
It’s important for organizations to have rewards and recognition programs. That’s because they are part of the performance management systems of organizations. A lot of managers think of reward and recognition programs as a means of distributing financial rewards and incentives.
What they don’t know is that simple recognition of hardworking employees is a crucial aspect of maintaining morale. It, in turn, boosts productivity and increases growth.
4. 360-Degree Feedback Platform
This software deals with the evaluation and assessment of employees. This could either be internal or external.
The main question that the software answers is how well your employees are performing. It provides a detailed assessment of every employee based on the views of those that they work with. The reports are usually confidential and are presented to employees by their managers.
360-degree feedback software is, therefore, used in employee training and development. When used effectively, the tool helps in simplifying the review process as it considers many people’s opinions and not only the managers’.
5. Performance Appraisal Tools
This is one of the top performance management tools. It’s known to be potent for combining an individual’s goals with the common goals of an organization.
To get the right amount of output from this software, employees must ensure that the appraisal is honest and fair. They must also ensure that there’s constructive two-way communication. Failure to take note of these points can cause the appraisal to work as a demotivation for the organization leading to a decline in performance.
Appraisals can also help an organization with the identification of employees that are not performing up to the mark.
6. Personal Development Plans (PDP)
This is an expertly and efficiently designed action plan that’s based on the needs, wants, and awareness of the actions that will support personal and organizational development.
PDPs are useful in the identification of different types of training and development needs. They also help in developing an action plan for fulfilling organizational needs. Additionally, it helps individuals in setting out how they want to grow and how to achieve their goals.
This helps to build interest in the organization, enabling employees to improve their performance. To make sure that there’s a high performance, certain tools like PDPs act as important parts of the organization.
7. Task Management tools
Task management tools such as Kanban can help managers keep track of the productivity of their team members. This platform can be thought of as a signal and response system. When an item is running at an operational station, there will be a visual cue on how much to order. The individual using the parts then orders for the quantity indicated by the Kanban and the supplier offers the requested amount.
If, for instance, an employee is bagging products on a conveyor belt, a Kanban can be placed in the stock above the last 10 bags. When the employee gets to the card, they give the floor runners the card to bring more bags.
A station far away from the supply room can have a Kanban placed at 15 bags and a closer one at five. The flow of bags and card placements get adjusted to ensure no station gets left bag-less when the belt is running.
The Kanban system can be used within an organization. It can also be applied to purchasing inventory from external suppliers. The system develops extraordinary visibility to suppliers and buyers.
Kanban’s main goal is to limit the build-up of excess inventory at any point of production. Limits on the number of items waiting at supply points get established and minimized as efficiencies are identified and removed. When a limit of inventory exceeds, it points to inefficiencies that must be addressed.
Performance management tools provide a useful framework for continuously assessing and boosting productivity. Organizations can identify and reward strong team members through engagement surveys, appraisals, and OKRs. They are also able to understand existing weaknesses among employees with the help of performance management software.