Contemporary performance management is such that switching to an online performance management system is not so much an “if” but a “when.” In this interview, SpriggHR Founder Jilaine Parkes lays out the business case for implementing such a system, and how to go about doing it.
Jilaine Parkes: The top-of-mind need is more efficiency in conducting employee appraisals. However, critical business needs are also met by online performance management systems.
The first is that online systems allow you to extract data points and analytics in seconds, versus the weeks of time it would take to do the same work with a pen-and-paper system. This means you can look at the goals employees are setting, and see how they align with overall corporate objectives. Our system, for example, allows management to run the Goal Alignment Report for just this purpose.
The second is that these systems promote an equitable and consistent approach when it comes to performance management. It allows for managers to compensate employees based on performance, and not just their own subjectivity. For example, base pay adjustments are frequently doled out equally, for ease – but this can demoralize top performers in your company. An online system can allow for a calibration of that adjustment, so that your best talent is rewarded for their hard work.
The analytics you gain save your company money through more accurate compensation, but also through avoiding the turnover that can happen when your best people get fed up and take their talent elsewhere.
JP: Our own system is designed to be as easy as possible, to replicate the existing pen-and-paper method of performance appraisals that employees are already used to. They don’t really need to learn anything new skill-wise, but they do need to be open to and comfortable with giving and getting more regular feedback. These systems promote more engagement and collaboration between managers and their employees, and among teams, too.
JP: I find that the involvement varies depending on the organization, but generally, you first have an HR person who’s vetting anywhere between three to five systems and then narrows them down to two.
Then, you have someone who’s responsible for the corporate budget, and who asks more questions about what those systems can do to find efficiencies in the review process. This person is likely senior management and looking at the overall business benefits.
There’s also usually an administrative person who will be setting the system up and bringing staff onboard.
JP: Buy-in is evidenced through the business case for these systems: that they promote a clarity of direction with respect to the company goals and values, that they facilitate more productivity, and that they create more contentment and satisfaction among employees.
The efficiency piece cannot be overlooked, either: we did a study that estimated the number of hours it took a manager, per employee, to conduct a performance review with the pen-and-paper system versus an online system, and the results are just staggering: 12-14 hours on paper versus two or three online. Multiply that cost over ten direct reports per manager and then across the whole company, and you see where the savings are lying in wait.
On our part, we run a kickoff demo with the executive team after they’ve decided to go with us to onboard them to the Sprigg platform.
JP: Above all, you have to ensure that the organization is ready for what the system is trying to promote – the internal objectives of the company need to be clear. Management needs to know what the business vision is, what people should be working on, and the company culture they’re striving to achieve.
On the individual’s part, they need to be prepared to communicate more frequently through giving and receiving feedback, and understand that their performance is not only going to be evaluated on their competencies, but how well their behaviour fits the culture and values of the company, too.
JP: The implementation process is where a switch to online can fail – you need a strong, internal champion who can work with the system provider to onboard the company. At Sprigg, we have an implementation team that prepares a plan and keeps a careful watch on early-term engagement to make sure that employees are taking up the new system. Providing email templates and next steps makes the process as smooth as possible.
Training is also critical: people need to understand their roles and what’s expected of them within the system.
JP: Overall, it’s that with the knowledge you gain from analytics and a more productive, content workforce, you’ll have a handle on your business that you didn’t before.