Understanding Performance Management
In business literature, performance management focuses on activities that ensure goals and objectives, on an individual, department, or company-wide level, are being met effectively and efficiently. Performance management also incorporates how organizations choose to organize and align their systems, resources, and employees with the company's priorities and its strategic objectives. Essentially, performance management looks at the ways to best manage and direct behavior and results (which are critical elements of performance) to achieve goals.
Gap analysis, alternatively, is the comparison of actual job performance with potential performance. A lack of utilizing the vast resources, a lack of investment in human capital, technology, or other instrumentation, and similar limitations or poor decisions, which may have negative consequences for the company. Individual gap analysis looks at the current performance of an individual within the company and their potential for performance; an obvious area of exploration when it comes to talent management.
Behavior and results are the two key features of performance and may be considered equally important or may heavily favor one side or the other based on the position, the company goals, and a genuine appreciation for realistic expectations. For example, human capital is considered valuable because it is designed to be effectively used to achieve certain results, which in turn fulfill missions or goals of the company as a whole. However, it is important to note that some goals are extremely long term and an individual may not be able to demonstrate their value based upon results. In such cases, their behavior may play a larger role.
Consider a film director, if a film does well at the box office, it is usually considered to have been successful. Alternatively, a film that may not have had box office success but is critically acclaimed might also be considered successful; it all comes down to the goals of the investors or Production Company. Certain filmmakers and major companies choose to focus on box office success because of its monetary value and it is important to note that films that are successful at the box office may also be successful amongst critics. Nevertheless, there are also production companies who want to fund films that are more geared to words, intellectual pursuit, or social justice rather than simply monetary gain. Both films may achieve the desired results even though the desired results are significantly different.

Now, consider if you are part of a production company and a director you are working with has done 10 films, all of which have been critically acclaimed, but none of which have performed well at the box office. At some point, because making movies is expensive, that company is going to have to look at the gap between what the director's performance is versus what the director's performance could be. Is it possible for this director to achieve better box office results with the resources they are given? Does more money need to be invested to make the film more commercially successful? Does the director have an interest in making commercially successful films? In addition, the roles could be entirely reversed if a particular director tends to create commercially successful films that are consistently panned or even offensive. It all depends on the goal of each film.

When it comes to talent within your company, it is imperative that you compare apples with apples and are honest about the resources you have provided to your employees. If it seems as though an employee's performance is poor, consider whether the employee has the requisite resources necessary to complete their tasks or fulfill their goals before assuming that their lack of success is a personal failing. If more than one individual who is considered to be talent is completing the same task as another individual, do not assume that because one person needs more resources that they are therefore unlikely to be successful in their position.
Any given test or activity might be an accurate representation of the strengths and weaknesses of your talent within that particular activity; it is not necessarily accurate or fair to assume that they will face the same (or more) challenges in future tasks. Performance management is not simply about pointing out the flaws of your employees, nor is it a reality show where someone is on the chopping block for one error or area of weakness.

Although performance management seems to focus or be synonymous with an employee review where only flaws and problems are addressed, this is not so. Actually, employee reviews should not be like that. An open and honest assessment of an employee's faults and mistakes is certainly part of performance management but if the other elements are absent, you are not managing performance but rather setting employees up to fail.

Evaluating an employee's strengths and accomplishments is just as, if not more important than addressing their problem areas. Just as an employee may not always be aware that they are doing something incorrectly, they may likewise be unaware that they are performing certain tasks well or even excellently. Particularly new or undeveloped talent is unlikely to feel confident in many of their tasks; by acknowledging their successes, they know that they are on the right track, you have validated that they are capable of performing their job, and you have demonstrated that you are aware of the good work they are doing as well as their mistakes.
While members of talent are typically very confident in their potential, they are not always as confident about their day-to-day decisions. If they continue to feel unsure about those decisions because you have not provided reinforcement, you may end up with overwhelmed staff members who might choose to leave their job. Alternatively, those with talent who are aware that they are performing well but who are not receiving any acknowledgment of their success may feel slighted or unappreciated and may likewise leave the company. Clearly, there are plenty of reasons why it is worth your time and effort to acknowledge success and good decisions as well as errors in judgment.

In addition to assessing and providing feedback, it is also vitally important that employers and mentors provide positive reinforcement. Punitive or negative actions tend to be disheartening and promote an atmosphere of distrust and dissatisfaction. While there are certainly times in situations where negative reinforcement is appropriate in a business context, this is usually most effective when rules are being violated or a staff member has become offensive or belligerent. When dealing with issues of performance management, negative reinforcement rarely works and often results in a staff member feeling unvalued or even fearful, neither of which promote better decision making and increases success.

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How do you provide positive reinforcement within the workplace? As cheesy and trite as it sounds, by accentuating the positive and working to eliminate the negative you provide positive reinforcement. Any time that you are working to develop talent and improve an employee's performance, put forth the effort to never offer criticism without also providing a compliment. For a simple example, consider a sales clerk who is attempting to sell a particular camera but when describing the benefits of the camera, the customer loses interest, and the sale is lost. Positive reinforcement might include explaining to the clerk how too much technical detail may be overwhelming for the customer while also praising some other aspect of the interaction such as how the clerk had the customer personally handle and look through the lens to get a feel for the camera. Rarely is someone so bad at their job, especially when they are in a leadership or talent position, that there is never something positive to say.

When you provide positive reinforcement to your talent, you have helped provide a sense of worth for the employee within the context of their job. This motivates the employee to do well as they understand that their efforts are being recognized. Identifying and focusing on the positive attributes will likewise encourage your talent to continue providing the desired behavior, both because they now know that they are on the right track and because they value praise. Positive reinforcement can also play a huge role in improving workplace morale. Supervisors who focus on flaws rather than strengths end up with a whole team of people who are living in an atmosphere of low morale, even when some of those people are excellent at their job. Never underestimate the power of one team member's misery to influence others.

Lastly, be sure not to look at performance management as a period of evaluation that occurs on an annual basis. Performance management should really be constantly interlocked with the actions of developing talent. Two (or more) different people, such as having a mentor who works to develop talent and a direct supervisor who focuses on performance management, may even provide the two. Nevertheless, it is critical that anyone working on talent development is aware of performance management assessments, strengths, and weaknesses, and provides a positive reinforcement as part of the ongoing development of their talent.