The Evolution of Performance Management: 3 Ways Performance Management Has Changed

You are a character in a game and you’re leveling up your character. To increase your character’s level, you need experience that you get by successfully finishing a mission. You have a bar that shows your current experience and you just completed your mission. You will have no idea whether the mission was a success or a failure until you receive feedback on it – in a year. After a year, you learn that the mission was a failure. 

In a game today, that would be ludicrous, but this was how performance management used to be. Employees had to wait for about a year to find out if they were doing a good job or if they needed to learn and adapt. It’s no wonder that the 2017 McKinsey Global Survey found that 54% of respondents said their performance reviews had no positive impact on performance.

When done poorly, performance management becomes an administrative task of almost no value. However, when done right, it becomes a strategic tool for your organization. This leads us to the first way performance management evolved. 

From Old to New— Employees at the Centre of Performance Management 

The old performance management model was used to determine the salary of the employee. Today’s performance management model is used as a performance improvement tool with the employees at the centre. 

A study done by Bain&Co discovered that inspired employees are 225% more productive than engaged employees. To inspire employees, you need to invest in them and make sure they’re growing on their job. Performance management is one of the best ways to do this. 

Managers need to have constant communication with their employees and go through soft skills training to deliver the best possible employee experiences.  

Challenges with this step include: 

  • Ensuring proper training for managers (how to support positive mental health, run effective check-ins, deliver great feedback)
  • Implementing OKRs or another goal-setting framework to co-create goals
  • Transforming managers into coaches

Course Correction Is The New Way Forward

Do you know that planes constantly course-correct during flights? If they didn’t, they would miss their mark by quite a lot! The same thing applies to performance management. 

The old way of doing it would be once a year, but the new way should be almost daily. 

Managers are constantly providing feedback and learning opportunities to their employees so they can “course-correct.” This way, employees are made aware of what they’re doing right and what they’re doing wrong so they can correct it as soon as possible. 

This will ensure they hit their targets at the end of the quarter/year.

Challenges with this step include: 

  • Using 1-on-1’s to create a meaningful relationship between managers and employees 
  • Implementing the three R’s of feedback: real-time, regular, round-the-clock
  • Check-ins on employee’s personal and professional goals
  • Reducing bias

Tech That Enables But Doesn’t Replace

Technology is a great enabler and it’s no different for performance management. Tech can help improve your performance management processes, but it can’t replace certain elements of performance management. 

Tech enables you to have a 1-on-1 Zoom meeting with an employee, but when possible, you should still have face-to-face communication. A Zoom meeting can’t replace that face-to-face interaction. 

Managers can (and should) use a variety of (digital) tools and applications to help with performance management. Anything that can help streamline the entire process should be used. Apps that help with reviews, feedback, training, and learning are just some of the benefits of tech. 

Challenges with this step include:: 

  • Integration: Having too many applications resulting in managers getting lost in all the “logins” required
  • Finding the right tech that suits your workplace
  • Employee buy-in: Think about the usability of new technology and try to get buy-in from employees before committing to it


Performance management is evolving and companies are starting to take notice and adapt. The new focus on employees and the transformation of managers into coaches has helped companies achieve better results with their performance management process.

To learn other ways to improve the performance management process, check out our recent webinar,  “Breathing New Life into Performance Management”.

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