Performance Management Cycle

The performance management cycle is a model that allows management and employees to better achieve farm goals through a structured process of employee development. It utilises a continuous four-step procedure of planning, monitoring, reviewing and rewarding.

Benefits of utilizing this method include increased competitiveness, more structural flexibility, and higher employee motivation.

The performance management cycle runs on a year-long timeline, ending with a performance review.

Phase 1: Performance Planning and Contracting

A good time for this phase is January/February of each year. Organisations can however change timing according to their needs and seasonal production cycles.

This phase consists of a formal planning and contracting discussion between a staff member and his/her direct manager/supervisor. During this phase, it must be established which Key Result Areas (KRA's) are applicable to the individual employee and performance and development objectives for each KRA must be contracted. Both parties must understand exactly what is expected and formally contract by signing a performance and development agreement.

This is a very important phase. The performance and development of every single employee will be affected on an annual basis by the details agreed to during this discussion. Eventually, every employee will be rated according to his/her performance in accordance with his/her individual performance plan. Most importantly the appropriate KRA's must be identified for each individual. KRA's must cover the complete spectrum of an individual's functions and responsibilities. Similar positions will therefore have similar KRA's. The next step will be to set SMART objectives for every KRA. The acronym SMART indicates that objectives must be:

◆ Specific ◆ Measurable ◆ Achievable ◆ Realistic, and ◆ Time Specific.

This means that for every objective a specific method of measuring or monitoring must be identified and agreed upon. For every objective, a specific time frame for monitoring or completion must also be agreed upon.

Phase 2: Interim Review

June/July is a good time for the interim review.

Approximately midway between the planning phase and the final review (and appraisal) the manager/supervisor must conduct a formal feedback meeting with the employee. This is known as an interim review. Although it is crucial that employees receive ongoing feedback as soon as possible after the event to which the feedback pertains, it is still important to have a formal interim review. This review will allow both parties to formally assess and discuss specific progress measured against objectives set during the planning phase. Employees who are experiencing problems in achieving certain objectives could then discuss these problems with their manager and they can reach a common understanding of the problems and develop new plans of action. The formal nature of the interim review also renews the commitment of both parties and ensures that responsibilities and objectives are reviewed. It is also important to ascertain whether these objectives are still relevant or not, especially when changes in company strategy and direction have occurred. it is important that objectives should not be ‘cast in stone. Changes in conditions and situations might necessitate a change in the nature or priority of previously set objectives. During the interim review, both parties can agree on changes or additions to previously set objectives and enter into a changed contract.

During the interim review, managers should adopt a corrective approach and not a punitive approach. If an employee is not reaching his/her objectives an action plan must be developed to correct and/or improve performance. It must also be established why an employee is not reaching objectives and these problems must be addressed. Counselling, coaching and motivation might also be appropriate corrective measures.

Finally, it is also advisable to do an informal rating during the interim review to ensure that both parties know exactly where they stand. This will ensure that no surprises and disappointment occur during the final review stage since this can be damaging to the entire process.

Phase 3: Final Review and Appraisal

The final review usually takes place in November/December.

Many people approach the appraisal with fear and anxiety. Managers are sometimes seen to unfairly pass judgement on the personal worth of their staff. It is therefore important that the employee is seen as an active agent in determining objectives as well as in the evaluation of performance. This will ensure the employee’s commitment and buy-in to the process. Employees are often able to make valuable contributions in the planning and evaluation of their own performance as well as their development because they know their own potential and limitations.

The final review and appraisal should summarise an individual employee’s performance and development during the year. Whilst the process is similar to that which occurs during the interim review, it is during the third stage that individuals are rated in terms of whether or not they have met their objectives as agreed and contracted. Various rating scales can be used to rate individual performance.

Ideally, an appraisal interview should hold no surprises for the employee. To achieve this objective the evaluation should consider objectives and not personality traits; the criteria should be performance-related, and the standards must be clear from the beginning. The organisation must remember that appraisal interviews constitute only one phase of an effective Performance and Development Management process. If the employee has been receiving coaching, counselling and feedback regularly, then he/she should know how well he/she has performed during the period under review.

Therefore, except in the case of a failing employee, the discussion should not be significantly stressful. In fact, employees who have been performing well should look forward to the evaluation as a confirmation of good results achieved.

Click here to view an explanation of how to conduct a performance meeting.

Click here to view an explanation of the GROW model to coach your employees for better performance.