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  • Adele

What makes a good performance management strategy that drives business success?

Updated: Aug 6, 2023

This Blog post is an expanded article derived from a question I answered on Quora. You can see the original post on Quora here:

Leaders are instrumental at ensuring the success of an organisation and are constantly looking at ways to achieve operational excellence and improve performance.

Leaders that want to make an impact need to focus on employee-owned performance management and the performance management tools / processes should be reviewed regularly to make sure they are fit for purpose as the business moves forward. For example, what worked in a small start-up with under 5 employees might not be appropriate anymore for an SME with 150 employees.

The Institute of Leadership & Management says:

“Performance management is an ongoing process where you and your team work together to plan, monitor and review individual work outcomes, future goals, and development needs. Achieving leaders set clear expectations, monitor performance, and give feedback.”

The following 3 websites offer their take on what makes an effective Performance Management Strategy:

The ‘HR Daily Advisor’ suggests 6 Performance Management Strategies:

1. Define and Communicate Company Goals and Performance Objectives

2. Utilize Performance Management Software

3. Offer Frequent Performance Feedback

4. Use Peer Reviews

5. Pre-emptive Management and Recognition

6. Set Regular Meetings to Discuss Outcomes and Results

Whilst ‘Sprigg HR’ have 5 Strategic Performance Management Tips:

1. Communicate Company Goals & Performance Objectives

2. Regularly Offer Performance Feedback

3. Take Advantage of Performance Management Software

4. Utilize Multi-Rater Feedback

5. One-on-One Discussion Meeting Outcomes and Results

1. Define expectations

2. Stress the importance of regular reviews

3. Move away from the lecture format

4. Define rating scales

5. Emphasise a focus on the positives

6. Review your reviewers

You can see that the general themes of an effective performance management strategy are similar in the above 3 articles. To put it even more simply, I teach that for a performance management process to be successful it should be:

1) Simple to use

2) Communicated effectively throughout the business

3) Linked properly to Job Descriptions, KPIs and Competencies

4) Linked to reward & recognition programmes where appropriate

5) Used by management with thorough training in conducting performance reviews, giving effective feedback and setting SMART objectives

6) Reviewed regularly to check it is still fit for purpose

It’s worth reading the Institute of Leadership & Management’s article on Managing performance here: “Leadership Essentials: Managing Performance”

If you like data, the business consultancy firm Gartner ( has a good research piece on this topic, from 80 Chief Human Resource Officers and 10,000 employees across multiples businesses. You can access it here:

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