A performance management system that supports employee motivation and engagement should include the following components:
Clear goals and expectations: Employees should have clear and specific goals that are aligned with the organization’s overall objectives. These goals should be communicated clearly and regularly reviewed to ensure that employees understand what is expected of them.
Regular feedback: Employees should receive regular feedback on their performance, both formally (through performance reviews) and informally (through ongoing conversations with their manager). This feedback should be timely, specific, and constructive, and should help employees understand how they are doing and what they can do to improve.
Development opportunities: A performance management system should provide employees with opportunities to develop their skills and knowledge, through training, coaching, and other development activities. This helps employees feel engaged and motivated, as they see that their employer is invested in their professional growth.
Recognition and rewards: A performance management system should include mechanisms for recognizing and rewarding employees for their contributions and achievements. This can help to boost morale and motivation, and can also serve as an incentive for employees to continue to perform at a high level.
Communication and transparency: A performance management system should involve open and transparent communication, with regular opportunities for employees to provide feedback and ask questions. This helps to create a sense of trust and transparency, and can help to foster employee engagement and motivation.
As an successful example to change from Management by Objectives (MBO) to Performance & Development Cycle (PDC) I reference to SIX Group (see picture above) SIX undergoes a fundamental culture transformation. To reach the ambitious growth targets, SIX needs a high-performance culture to remain successful in the market. The new PDC is one core element that support the firm strategy. SIX changes the way from managing to enabling organizational performance. The key areas:
• Continuous dialogue and feedback during the year
• Strengthen ownership and put employees in the driver seat for their development and career
• Foster qualitative performance feedback
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