Nobody works more closely with our clients than our Customer Success team. So, we decided to ask Richard, Emily and Ros about the changes they’ve seen over the last 12 months. What new developments in performance management strategy will be taking us into 2025?

The team identified four major trends from across our customer base. Read on to hear more about each of them…

More companies are focusing on talent management

Taking a holistic approach to talent management and succession planning is on the up, says the team. And the start of the new year is when many HR professionals plan to pick this up. Talent management systems vary from manager questionnaires to more advanced performance management techniques where employees are automatically mapped based on their performance and potential.

At the simpler end of the scale, companies are asking employees about their aspirations, and asking questions of managers about whether a role is critical and who a likely successor might be. At the more complex end of performance management, companies are using a set of questions to evaluate potential and combining this with a performance rating to generate a score which maps employees onto a 9-box grid, providing visibility of talent across the business.

They’re doing this because companies want to know where their future stars are coming from, says Richard. Plus, if managers are involved in talent management it allows them to have more accountability for team development. This has two benefits: firstly, it enables better workforce planning. Secondly, by keeping employees feeling challenged, rewarded and nurtured, it boosts employee retention, reduces employee turnover and therefore, reduces the need for talent acquisition.

For more on talent management and how a customisable 9-box can help, listen to our recent talent management panel discussion. ‍

New and creative ways to share feedback and recognition

Instant feedback and employee recognition are trending, says Emily. More and more clients are enabling Appraisd’s feedback and recognition features and asking us to help them align them to their company values. Examples of employee recognition programmes include collating positive feedback into company newsletters, dedicating time at town hall meetings, and even creating a Slack channel for colleague shout-outs. In terms of process, this varies across clients with some creating a mechanism to nominate colleagues via HR, some offering company-wide instant feedback via Slack, and another customer sending out employee rewards in the form of gifts to people who have been recognised by peers as doing a great job.

Customers are increasingly drawing feedback into annual reviews, quarterly reviews and check-ins so employees and their manager can have a conversation about the positives over the period. In doing this, more companies are aiming to embed their values and culture in the performance management process.

🎧 On a previous episode of our podcast we spoke to Chief of Staff at Illuminate Financial, Rachel Townend, about the amazing things they’re doing with employee recognition. ‍

Stronger alignment of personal to company objectives

More customers are working to align individual performance management objectives to company or departmental goals, says Ros. Their rationale for this is to create more connection between employee goals and company goals - and more visibility of that connection. When companies set new goals annually or quarterly, they’re revisiting individual objectives to check there is alignment. This process also helps employees and line managers to think about objective-setting in a more structured way.

As well as providing more clarity for employees, this way of working is making it easier for HR to report to the Senior Leadership Team. At one client company, the HR team provides a quarterly report on progress against performance management objectives, each of which is aligned to company goals. Another client shows the SLT a distribution of how each departmental objective is aligned to overall company aims.

Tracking employee goals alongside company goals gives clarity and visibility to everyone in the organisation about their contribution, and it minimises the risk of people not spending their time doing the right things, says Richard. At a higher level, it encourages a shared sense of purpose and helps every employee understand why they’re being asked to work on certain performance management objectives. ‍

Including values in every step of performance management

It’s not just ‘what’ people work on, it’s the ‘how’ work is getting done, says Richard, with more companies becoming focused on how work aligns to their culture and values. The use of values is widespread in employee recognition programmes but more are now incorporating them in every step of the performance management process.

Examples include embedding values in review forms, objective-setting templates, performance review templates, annual reviews and PDP tracking. There is a shift from forms with solely competency-based questions, to asking employees to self-evaluate how they’ve demonstrated company values throughout the year. One client asks employees in their start-of-year review to pick three values they want to work towards and another asks employees to align each objective to one or more values.

Values are now much more than a poster in the office! More clients are putting them to work, getting them living and breathing and demonstrating how the company really values certain behaviours, says Richard. Some are including value in 360 feedback and even in end-of-year performance review ratings and weighting the ‘what’ versus the ‘how’ of what has been achieved. And, says Emily, companies are starting to alter that ratio, adding more value to the ‘how’, to express the importance the business places on values.

What changes will you be making this year?

Looking to make some changes to performance management this year? 🎧Hear more about these trends from the Appraisd team on our podcast: Navigating Performance Management | Trends in 2024.

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