6 business benefits of continuous performance management

By Hassan Uddeen

In 2012, Adobe triggered a dramatic increase in its productivity after abolishing its annual performance review format. 

Inspired by Adobe’s success, Accenture, a tech giant with over 300,000 employees at the time, also stopped annual reviews and numeric performance ratings. (The company now adheres to a more flexible system that delivers ongoing feedback after assignments are completed.)

It’s clear that our talent management culture has changed. Continuous performance management is gradually replacing and sculpting traditional performance management practices.  

But how does implementing continuous performance management (otherwise known as agile performance management) benefit your organization? And why is it so effective for motivating the modern workforce? 

Benefit #1: Your organization is more adaptable

Continuous performance management (when implemented via the right employee performance management system) makes it easier for managers and team members to recognize career development opportunities that are mutually beneficial to individual and corporate goals. 

Threats that undermine your organization’s adaptability and competitiveness, like gaping skills or competency gaps, are quickly identified, diagnosed and dealt with. 

If a certain group of competencies and skills render your organization vulnerable to change, you can hire the expertise required or immediately assign training to the most relevant employees (who are most likely searching for that opportunity). 

Recommended read: Employee experience vs employee engagement: Why leaders fail

Benefit #2: Employee feedback is actionable 

Annual feedback limits interactions between management and staff. When feedback is provided using the traditional feedback process, it’s often “saved up” vague feedback unleashed on an unsuspecting employee about something that happened at the start or middle of the year. 

Not only does this cripple morale by adding to the anxiety triggered by an upcoming performance review, but it also limits the opportunities to adjust behavior, correct course on certain projects and genuinely check in on employee wellbeing throughout the year. 

With a continuous performance management process, feedback is immediate and future-focused. This makes feedback more relevant when shared by a manager and more actionable when received by an employee. 

Why not take our free courses to learn more? We’d recommend starting with the introduction to continuous performance managementcompetency frameworks and evidence-based appraisals courses to get started.

(You’ll also learn best practices and get to use Totara Perform’s features). 

Benefit #3: Managers nurture a high-performance culture 

Relevant and continuous feedback means team members will know what’s expected of them, where they are going wrong, and how good their performance is. 

Equally, managers are more likely to self-identify as coaches and mentors rather than task-masters. This can stimulate a powerful positive shift in your company’s corporate culture. 

Benefit #4: Employees are more engaged 

Modern employees expect more autonomy, purpose, a clear path to skills mastery, and prefer receiving feedback on a weekly or even daily basis. 

Meeting these critical employee expectations can prove challenging, but a continuous performance management system makes things easier. 

Managers and employees speak frequently and are able to communicate their developing goals and feedback. This allows your organization to develop the skills of (and engage) its employees while improving overall workforce competence and competitiveness. 

Benefit #5: Employees know their Objectives and Key Results (OKRs) 

Unlike traditional goal-setting, which often uses vague goals that are hard to monitor, OKRs track progress by focusing on the overall objectives and necessary results behind every goal. 

These goals act as a compass for every check-in and align the goals of your organization and employees. The end result is that employees know what to work towards and how their success is measured, and managers know how to track and reward performance. 

Thanks to more open communication and frequent feedback, managers can make better use out of goal-setting frameworks like OKRs and SMART goals and set relevant goals that motivate employees and align with corporate objectives.  

Benefit #6: Managers get an accurate picture of performance 

A manager’s measure of performance is often subjective and influenced by many things; a direct/indirect line of reporting, the nature of work completed, and how outgoing an employee is all influence a manager’s final decision. 

Continuous performance management makes reviews more objective with 360-degree feedback. 360 feedback supports or compares manager feedback with input from an employee’s colleagues to give accurate insight into an employee’s expertise, performance and behavior.

This reduces the chances of recency bias (when employee output measured closer to the appraisal date is given precedence over year-long or average performance) and other types of workplace bias that harm the performance review process. 

Ready to benefit from continuous performance management? 

Totara Perform, our adaptive performance management system, does not force you to adopt a specific approach. The system supports and grows with you, regardless of which end of the “performance management spectrum” you happen to sit on. 

It also connects with your existing HCM and CRM tools to help you make the switch without destabilizing existing processes and workflows. 

If you’re interested in Totara Perform, book a demo now

Alternatively, feel free to join the Totara Community where you can learn more about continuous performance management, and experience the features of our LMSLXP and performance management system

We’d recommend signing up for our competency framework and evidence-based appraisals courses to get started. (You’ll learn best practices and get to use Totara Perform’s features). 

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