Making the Move From Performance Management to Performance Development: 4 Must-Know Insights

As more and more companies move away from traditional performance management processes to embrace rating-less reviews and encourage more frequent conversations, they’re finding the change is easier in theory than in practice.

At their core, performance management programs are really about supporting employees to elevate their performance in ways that advance the company’s goals and their own career success. In most cases, what’s needed is not performance “management” per se, it’s performance development—helping employees learn, grow, and improve to meet individual and team goals and contribute to the company in smarter, more productive ways.

If this is truly what companies want, it’s not enough to simply take away ratings and ask people to talk more. What’s needed is a focus on building an organizational culture and “muscle” around continuous development, feedback, and coaching.

Below are a few lessons we’ve learned from our experience working with companies that are making this transition.

Moving From Performance Management to Performance Development

• The change must be leader-led—This cannot be an HR initiative. The evolution from performance management to performance development has to start at the top with leaders embracing, modeling, and supporting the belief that learning and continuous improvement is what’s needed to get the company to where it wants to go. A performance rating might be helpful to anchor rewards decisions, but it does not motivate or enable higher performance. To do that, leaders must create a true “growth mindset” culture where people feel inspired, empowered, and accountable to continually learn, develop, and grow.
• Don’t just tell. Equip and enable—Encouraging more frequent conversations, feedback, and coaching is not enough. Many managers (and employees) harbour serious anxiety about giving and receiving feedback, and will often avoid it if possible. To create a regular practice of feedback in support of development, it’s critical to invest in the information, skill building, resources, and tools that will support both managers and employees to have more meaningful and impactful conversations.
• Make it a shared accountability—Effective performance development requires a top-down and bottom-up approach. Employees and managers share the responsibility to initiate conversations and to give and request feedback. Asking for feedback is equally as important as giving feedback—and in fact, people are more likely to be open to and learn from feedback when they invite it. Employees must feel empowered to own their development and be equal participants in the process.
• Establish a clear line of sight—Demonstrating the link between individual growth and business growth is key. Discuss development opportunities in the context of the business, giving employees a clear understanding of how their priorities, learning, and overall performance directly align with and impact their team’s and the company’s goals. When each employee focuses on improving their performance and continuing to develop and grow in ways that benefit them personally and benefit the larger organization, it’s a win-win outcome for everyone.

Moving from performance “management” to performance “development” is not a short-term goal, it’s a multi-year journey. The first step is setting the intention and getting leaders fully on board to own and drive the change. Then it takes a long-term commitment to seed the change, build the skills, and continually reinforce the mindset and behaviors that are needed to enable a high-performance culture fueled by ongoing learning, development, and growth.