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Performance Management Cycle: 7 Trends for 2020!

The performance management cycle is a mature process in most organizations, especially the bigger ones.

But there is a downside to this maturity: the performance management cycle becomes incredibly structured and complex

New research from the performance factory shows that there are seven trends shaping the performance management cycle in 2020.

Performance management - 7 trends that impact the performance management cycle in 2020

Performance management cycle in 2020

Let’s take a closer look:

1. Performance Management cycle: from yearly to quarterly reviews

In a business world where things change at lightning speed, the goal setting needs to follow the business. If the overall business objectives change, individual goals need to change as well. If not, the exercise becomes obsolete.

But as most of the current goal setting processes are too heavy, they aren’t adapted to the new needs. We see a clear trend of more and more companies making the process lighter, but increasing the frequency of reviews from once a year to a quarterly process.

2. Keep the performance management process simple, please

The individual performance management process has become too heavy in many organisations, a complexity that managers are highlighting. It’s time for organisations to answer the question: “What is really needed, what’s at the core and what would be nice to have” and act upon it.

3. Goal setting: importance and quality of the learning goals increases

The learning goals are the individual goals related to the skills and competences that the individual needs to develop in order to increase the success rate of business goals. They are tailored to each individual and always related to the business goals.

Most people find the setting of development goals much more difficult than that of business goals. But we are slowly seeing some improvement. They become part of the standard performance management system in most organizations.

4. Added value of performance coaching is increasingly being recognized

The manager as the coach is a leadership style that is slowly becoming the predominant model. The role of the hierarchy continues to be important in some parts of the world, but at least during the performance discussions coaching is becoming ever more common.

Performance management is more than a performance appraisal. Coaching becomes part of the framework to manage performance as a system, not a single event at the start / end of the year. The best known coaching technique remains the GROW Model.

5. Performance management skills development changes

Teaching people how to set, monitor and evaluate high-quality individual goals is also changing. The typical classroom training where you put people in a room for one or two days and drill people to make objectives SMART is from the past.

Best-in-class companies go for high energy, short sessions that tackle the core of individual goal setting. The use of learning instruments like video and other e-learning tools is also becoming very popular.

6. Performance management cycle: more focus on link with strategy

Individual goal setting is not an individual exercise that you undertake to satisfy Human Resources.

Fortunately, more and more companies are realizing this and spending time and energy to improve the link between the individual goals and overall strategy.

This ranges from a formal presentation or video from the CEO explaining the overall direction and requesting what role you can play to exercises where people have to link their own goals to the level above.

Performance management is a crucial strategy execution component and starts to get the recognition it deserves.

performance management cycle - image performance management quotes - Success is the sum of small efforts repeated day in day out - Robert Collier

7. Companies will measure the quality of the goal setting cycle differently

“Does everyone have individual goals?” has been the quality norm that quite a few organizations have been using for years. “Yes, 98 percent of our employees have individual goals” was the victory shout.

But having business goals is not the same as having employees working at peak performance. Luckily, more and more leaders realize this and are changing the way that they measure the quality of the individual goal setting process.

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