One thing the unpredictability of the past few years has taught business leaders is that they need to be able to navigate change, and quickly. There are many tools that companies should have in their arsenal to be able to do this, but three major areas to prioritize are skills development, career growth and talent mobility. Why is this significant? First, a highly skilled workforce is more capable and efficient. Such employees can perform their duties better, driving greater success for the organization overall, in turn attracting investors. Additionally, if employees feel that their organization is investing in their growth and prioritizing their development, they are more likely to remain with the organization.
Our 2022 Global Skills Report revealed that 79% of employees want more skills development content and opportunities from their employer. With skills development and learning at the heart of employee performance management, it seems obvious that organizations should be prioritizing this. However, just 56% of companies are investing in these areas. This needs to change, and organizations must connect employee learning, career development and talent mobility with a robust performance management process that will drive the business and its people toward success.
Linking performance, learning and business success
Performance evaluations have evolved. Once an annual event — where an employee might face a barrage of feedback, goals and targets in an hour — they have become more continuous in recent years. The focus is moving from compliance to becoming more people-centric and development-orientated with continuous skilling and a focus on developing new leaders, not just existing ones. The value of focusing on employees in this way is clear. McKinsey revealed that businesses that focused on a “performance through people” strategy provided an average of 74 hours of training per employee. As a result, their revenues grew 2x faster, and they were 4.3x more likely to maintain strong financial performance for 9 out of 10 years.
As such, to become a high-performing organization with demonstrated business results, a company must align with its employees’ perceptions, needs and desires for career development. Investing in key programs to drive employee happiness while providing ongoing, people-centric, development-oriented feedback is essential to improving long-term talent retention. Managers must unlock potential on a personal level through continuous conversations and reframe the language around performance management from “good enough” to “business critical.”
Harnessing the employee development lifecycle
Organizations that want to become high-performing need to put their employees in the driver’s seat of their careers. The way to do this is to link performance and learning. This allows organizations to monitor individuals’ learning and development progress as part of continuous performance management to provide targeted guidance, as well as track performance and understand how employees are improving (or need to improve). With this approach, organizations can also provide personalized development paths for skill building that will sit alongside individuals’ performance goals and targets.
Organizations can help their people take on new opportunities, stretch assignments and gigs by leveraging consistent check-ins throughout the employee development lifecycle. Let’s take a closer look at that lifecycle now:
- Review and assess the goals, performance and skills proficiency of an employee. This is the crucial first step in establishing how an individual’s performance will be managed and evaluated
- Set tailored goals by identifying what employees want to achieve and assessing skills gaps to determine where development is needed
- Conduct consistent check-ins to give employees access to feedback and coaching, as well as learning recommendations and the chance to update their proficiency levels
- Hold development conversations to continuously revisit goals, discuss persisting skills gaps and make a development plan that is adhered to
By leveraging this lifecycle, companies can continuously gather up-to-date information to improve their employee performance management and skills strategies and ultimately, accelerate growth. Additionally, employees can better visualize their training and development, which encourages them to continue to grow in alignment with the business.
Using performance management to power internal mobility
This then takes us to talent mobility. The magic combination of learning, performance and skills development opens up a world of internal career mobility to organizations. For instance, our 2023 Talent Mobility Study found that 51% of employees in EMEA say that the best way their company can support their skills development is by giving them opportunities to pivot, stretch and grow. The research from McKinsey supports this, saying 35% of employees who work for a business with a “performance through people” strategy advance within the organization.
A strong employee performance management strategy can only lead to positive outcomes. By utilizing the employee development lifecycle, businesses can help their talent to quickly develop and deploy their skills, thus improving performance. As employees grow and level up their careers, businesses achieve an increase in retention, employee engagement, and productivity. In other words, companies can no longer afford to overlook the value that employee performance management adds to their skills strategy and overall business success.
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Download the 2024 Trends in Performance Management whitepaper and schedule a demo to learn how Cornerstone Performance nurtures continued development via a unified talent management system.
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