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Business management

Performance review goals for 2022

After nearly two years of business disruption, setting employee objectives for 2022 won’t be easy.

It has been a particularly challenging couple of years for businesses of all sizes. Many have had to quickly learn how to cope with the pandemic, supply shortages, the much-quoted ‘war for talent’, and rising inflation. 

Managing levels of performance amid such disruptive forces requires an integrated approach. Employees need to feel confident their skills, goals and well-being are recognised. Employers want to know their staff are productive, effective and motivated to stay committed to the company for the long term.

Here are some considerations for business leaders who want to make sure their processes, systems and procedures are fit for purpose in 2022. 

Providing employees with clarity is key to setting them up for success

Communication and collaboration are harder when teams are working from different locations. With more people working remotely, clarity becomes even more important, and the use of digital tools to aid interactions at work is becoming more commonplace. Remember the following:

  • Be clear on required outcomes and measure performance via outputs, not what you can physically see on a daily basis.

  • Performance objectives alone are not enough. Think about the behaviours and skills required to be successful in a remote environment. 

  • Objectives and goals should focus on work outcomes as well as goals for future skills development. 

  • Consider the skills your people need to thrive in a world where digital transformation and automation are accelerating.

  • Incorporate development goals to help prepare your workforce for the future.

Measure outcomes as well as circumstances

In a hybrid world, it’s important to measure outcomes as well as the circumstances against which those outcomes are achieved. 

Homeworking has led to the workforce has becoming humanised – people want to continue to be seen as individuals, not just employees. 

Great conversations should not only look back and reflect on what has been delivered but also look forward, while considering what support is required to reach longer-term goals.

Natalie Nelson
Technical Advice Lead, Royal Bank Mentor

When measuring performance, businesses should move beyond focusing on core performance measures and consider:

  • how the employee has achieved the results

  • what their personal circumstances are

  • how they have invested in their personal and continued development to make sure their skills and experience remain relevant in an ever-changing world

  • those assessing performance need to be mindful of any potential unconscious bias linked to homeworkers versus those in the office

Physically being able to see an employee working in the office may drive those assessing performance to think office-based workers are more productive. This is not necessarily the case: in fact, the pandemic has shown that many workers are more productive at home. 

Line managers need to challenge any biases and make sure they are treating all team members fairly and inclusively.

Best practice performance management is ‘always-on’ performance management

Smart businesses have realised effectively managing performance moves beyond an annual appraisal process. 

Great performance management involves an ongoing conversation with regular and timely feedback and coaching. This makes conversations and interventions to further enhance performance more relevant and matches the fast pace of change within today’s world of work. 

Great conversations should not only look back and reflect on what has been delivered but also look forward, while considering what support is required to reach longer-term goals. While looking ahead it’s also important to consider:

  • Think about having regular performance check-ins. Quarterly performance check-ins tend to work well, and many companies are now also using this as an opportunity to review and flex objectives. 

  • Objectives set in January may no longer be as relevant in July. It’s important to build in flex where possible.

  • Great performance management should also focus on planning for further career and skills development.

Be fair and consistent

How you manage and assess performance should be fair and consistent across teams and individuals. However, leaders must understand and acknowledge individual differences in preferences and motivations of their teams and adapt their style to suit this. 

For example, what motivates a salesperson in their mid-20s may be very different from what motivates a project manager in their 50s. Everyone is different and therefore it is the line manager’s responsibility to:

  • get to know your team members

  • understand their wants, needs and motivations

  • adapt your style and approach accordingly

What are the common challenges with appraisals and how do I overcome them?

Quite often, appraisals are implemented as an annual process at the end of the performance year, which can feel a bit like a non-value-add tick-box exercise. 

If performance conversations aren’t happening until the end of the performance year, businesses are missing the opportunity to drive further improvements and address any issues from the outset.

SME business owners should be really clear about what they would like their employees to achieve at the start of the performance year, including what ‘good’ looks like from a behavioural perspective.  

Rather than viewing the performance appraisal as a once-a-year process, small businesses should have regular continual conversations with their employees about performance, motivations and personal development.

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This material is published by NatWest Group plc (“NatWest Group”), for information purposes only and should not be regarded as providing any specific advice. Recipients should make their own independent evaluation of this information and no action should be taken, solely relying on it. This material should not be reproduced or disclosed without our consent. It is not intended for distribution in any jurisdiction in which this would be prohibited. Whilst this information is believed to be reliable, it has not been independently verified by NatWest Group and NatWest Group makes no representation or warranty (express or implied) of any kind, as regards the accuracy or completeness of this information, nor does it accept any responsibility or liability for any loss or damage arising in any way from any use made of or reliance placed on, this information. Unless otherwise stated, any views, forecasts, or estimates are solely those of the NatWest Group Economics Department, as of this date and are subject to change without notice.

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