How combining employee engagement and performance management fuels success

The performance management landscape is changing. Instead of being assessment-focused, leading users of the approach are shifting to looking to performance management as a way to engage and develop their teams. And when done well, performance management can increase another aspect of HR – employee engagement.

We are starting to witness organisations integrating the two approaches. A recent piece of research from Harvard Business Review’s Analytic Services team found that over 90% of business leaders agree that not only do engaged employees perform better, but employee engagement is critical to their business success.

The research showcased the example of a $9 billion integrated global health company that has tied engagement to patient satisfaction scores, quality scores, patient safety, re-admissions – and even hospital revenue. The company found a strong, provable correlation between near-miss safety incidents and low employee engagement.

The same research indicated that those organisations successful in adopting a linked approach between performance management and employee engagement end up with strongly-performing and highly engaged employees, outperforming peer organisations on a variety of business metrics – from revenue growth, quality, customer satisfaction, productivity to profitability, and more.

Equipping managers

Of course, making the transition to performance management and employee engagement working in a joined up way is not straightforward. The two disciplines have evolved in discrete parts of the business world, which means they use separate systems, rely on disparate data, and have different people managing them. The reality is that most organisations still operate with engagement and performance management in silos.

Clearly, bringing the two together requires a new approach. In the Harvard Business Review report, for instance, only 23% of survey respondents have a single place where managers can access information on their teams’ performance and engagement. For many, the interaction between performance management and employee engagement still involves awkward workarounds.

To rectify that, the manager’s role becomes paramount. People who have regular check-ins with their manager are far more engaged than those who do not, so it is important that we equip managers with the right mindset and tools to have ongoing conversations with their teams, at high quality and with high impact, providing leadership training to focus on development, coaching, and more. Discussing engagement scores frequently at management meetings is important, while a focus on conversations and taking action needs to become commonplace.

A more integrated approach to systems and data

Access to data is paramount. The vast majority of survey respondents (83%) said it’s very important to have access to data to understand what motivates and engages their employees, but less than a quarter (23%) have access to the data they need. A lack of data hamstrings managers, making it difficult to determine the right conversations and actions that will help increase performance and engagement.

We need to change that in HR. By providing managers with access to the performance and engagement data and the tools they need, they can have more meaningful employee conversations about priorities, performance, and growth.

By linking performance management and employee engagement in this way, you can finally realise the synergy of true employee engagement, with all the benefits that will bring to your brand and bottom line.