14 Supportive Ways To Handle Employee Performance Management Challenges

Leaders like Elon Musk continuously illustrate to the world how not to tackle performance management challenges.

‍In November 2022, the new Twitter CEO delivered an ultimatum to his newly acquired employees. He required them to click "Yes" on a Google form to commit to an updated and "hardcore" company policy. This policy involved "working long hours at high intensity," with the threat that "only exceptional performance will constitute a passing grade."

To no one's surprise, Musk's ultimatum prompted more than a thousand employees to resign. Instead, those employees preferred to accept Musk's option B—three months' severance pay. 

But this isn't the first time Musk has demonstrated a cutthroat attitude toward performance management. 

In his CEO role at Tesla, critics condemned Musk for firing 700 staff members because of poor performance reviews in 2017. 

Every company in every industry has experienced widespread disruption since 2020, creating brand-new employee performance management challenges as we adapt to the new era. 

Do you want to use a more nurturing strategy than Musk?

And learn how to handle these challenges while building trust and loyalty among your workforce? Then this is the guide for you. 

📸 A post-pandemic snapshot of performance management 

Disruption, chaos, adversity, and resilience have all been recognizable themes of the working landscape throughout the COVID-19 pandemic. 

As we emerge from the tunnel of the past few years, companies must now adjust their performance management practices. And they have to do so in the context of urgent challenges, including a global recession. 

Zippia cites that some 4 million U.S. workers resigned from their jobs each month throughout 2022, with a further 47 million employees leaving in 2021.

On top of these numbers, we've also seen an enormous response to the "quiet quitting movement." 

The bottom line? 

Employees are no longer putting up with inadequate working conditions anymore. Instead, they are opting to take control of their employment. 

Performance management offers the perfect arena to address any issues with workplace dynamics while ensuring staff remain engaged and aligned with company values during Industry 4.0.

😟 7 Emerging employee performance management challenges

HR leaders must consider these seven challenges when evaluating performance management systems and adapt their approach accordingly.

🌎 Evaluating a distributed workforce 

This challenge won't apply if you're still operating an "all employees in the office" policy. 

But for anyone trying to evaluate the performance of remote or hybrid employees, this can be a head-scratcher. 

How do you level the playing field and assess a 100% remote employee in a different time zone from someone you see in the office two days a week? 

Some companies choose to use corporate surveillance tools to monitor the productivity of any employee they can't easily keep track of. 

But Harvard Business Review explains how monitored employees are significantly more likely to take unapproved breaks, work deliberately slowly or disregard instructions. All of which negates the point of tracking their performance in the first place. 

Leaders can take solace in remote workers appearing to be more productive than their office-based counterparts. 

Owl Labs' State of Remote Work report reveals that 90% of remote employees work harder and for longer hours when they don't attend a physical workplace. 

💡Solution: Leaders conducting performance reviews must trust employees and track task or project output rather than hours logged or someone's status light on Slack.

🤫 Identifying quiet quitters 

Gallup research highlights that as many as 50% of the workforce have dabbled in quiet quitting. 

Quiet quitting refers to the movement where employees meet the baseline requirements of their role and refuse to go "above and beyond" to satisfy their employer. 

Managers can use the performance review process to identify quiet quitters among the ranks. 

But the idea isn't to reprimand or force them to work harder. 

Quite the opposite. 

Instead, your managers should strive to understand the background to their quiet quitting using a stay interview. 

If employees feel disengaged to the point where they must create boundaries, you've got some work to do. 

💡Solution: Enable your leaders to motivate and retain their talented employees. 1:1 meetings and regular check-ins are key here to better understand your reviewees' struggles. 

👩‍🏫 Prioritizing skills development 

LinkedIn research highlights that 72% of L&D leaders consider "skills development" to be the most urgent concern in the world. 

And the World Economic Forum points out that: 

• We must reskill 1 billion people by 2030. 
• Advancements in technology will displace 85 million jobs over the next five years. 

For performance managers, the pressing challenge is to identify the current skills gaps in organizational line-ups and identify the employees with the capabilities to fill them. 

Green skill development programs are also a top priority as companies seek to hit sustainability targets. 

But the lesser-known mad skills (those developed through hobbies such as sports, drama, or volunteering) can also enhance performance and boost company productivity if used correctly. 

Mark David, Director of Industry Strategy at Workday, explains: "Nothing is more vital than having a deep pool of "mad skills" available for clients. 

These mad skills encompass the entire range of talent attributes your employees need to be successful—not just hard skills but also competencies, behaviors, languages, certifications, and more."

💡Solution: Work closely with your employees to develop a customized growth plan based on existing and required skill sets.

👴 Adjusting performance management for changing demographics 

Millennials will represent approximately 75% of the workforce by 2025. Career growth opportunities drive this generation and Gen Z.    

But, the traditional approach to performance management (the bog standard annual review) isn't attractive to younger generations, who want to develop and progress quickly. 

Managers must recognize that millennials and Gen Zs need near-constant feedback to be motivated. They also want to make sure their work is meaningful, so they can easily visualize their impact on the organization and the wider community. 

💡Solution: Establish career pathing frameworks to demonstrate how employees from any demographic can intentionally forge ahead to progress into different internal roles.

🤖 Needing to automate feedback and development

With the rise of A.I. and automation, performance management should be less about micromanaging people and more about automating data-driven decisions and development. 

Machine learning advances mean companies can automate certain aspects of the performance review process. Automation means key stakeholders have more time to focus on strategic activities, such as coaching and nurturing talent.

💡Solution: There's a misconception that feedback automation is challenging to implement. Simplify the process using Zavvy's easy performance cycle builder.

👂 Finding ways to listen to the employee voice and opinion 

Employees are the heartbeat of any organization, and their needs have changed immensely since 2020. 

If managers and leaders aren't listening to their input, they risk losing out on vital insights and improvement opportunities.

Companies like Amazon, Google, Netflix, and Spotify have recently overhauled their performance review processes. But smaller companies also feel the pressure to be open and transparent, providing employees with the chance for you to hear them.

💡Solution: Introduce regular pulse surveys and leadership-focused surveys where you'll seek crucial upward feedback and hear your employees loud and clear. 

P.S.: We have detailed breakdowns if you want to see how Netflix and Google updated their performance review systems.  

🎥 Learn about Netflix's unique high-performance culture and approach to candid feedback.
🤖 Learn about Google's approach to manager performance and active listening to employees. 

😴 Spotting the signs of employee overload 

In 2019, the World Health Organization formally classified "employee burnout" as an "occupational phenomenon that occurs because of unmanaged, chronic workplace stress." 

We know that increasing workloads and blurred lines between work and home life cause mental and physical exhaustion. Therefore, early spotting of signs of burnout is crucial to protecting your employees. 

You can use your performance management process to do this. 

💡Solution: arrange regular performance check-ins with your employees. 

Use them to ask questions like "Are you coping with your workload this week?" or "Do you feel overwhelmed at the moment?" 

Carolyn Stern is the author of "The Emotionally Strong Leader." She explains her considerate approach to checking in with employees: 

"Ask them what drains their energy and what boosts their energy. You can't eliminate the work they find draining, but you can help them combat it.

Help them with their schedule to ensure their drainers are either peppered through the day or left for a part of their day in between their boosters."

😟 7 Existing employee performance management challenges

The focus on current and upcoming performance trends and concerns shouldn't detract from the foundations of a robust performance management system. 

Ensure you've tackled these performance challenges to keep the wheels turning smoothly.

🎯 Lacking clear objectives & tasks 

Employee reviews without performance-related goals are like a car with no fuel. Do you know how you plan to evaluate your employees or even the rating system you'll use? 

Ensure you set objectives and professional goals at the beginning of each performance cycle with clear KPIs and deliverables that can be easily tracked and measured. 

➡️ If you're unsure where to start, check out these practical SMART goals for your leaders and managers, including ten examples to follow.

💡 Solution: Define role expectations using career paths. In this way, your employees won't suffer from a lack of clarity about the required competencies for their position.

🗣️ Communicating company values 

Employee performance may suffer when your teams don't understand your organization's mission. 

Global CEO coach and keynote speaker Sabina Nawaz explains that employees often complain, "We don't have a north star."

In a Harvard Business Review article, she outlines some of the reasons why this communication breaks down: 

1. C-suite miscommunication: the further an employee is from the C-suite, the more you'll need to reassert company values. 
2. Hard to make the connection: it may be challenging for employees to link their daily tasks with the organizational mission statement. 
3. Dislike of company values: occasionally, your employees may claim they don't know your organizational goals. But the truth may be that they disagree with your mission but want to avoid conflict. 

💡 Solution: Communicate company values from recruitment and preboarding onwards. 

🗺️ Defining career development and progression strategies 

Providing a career development strategy is not only an employee retention tool but also a must-have for performance management. 

A development plan gives employees a sense of purpose and that they're growing with the company. These feelings foster loyalty as your team members won't need to seek growth opportunities at a competitor company. 

💡 Solution: Implement Zavvy's career progression path software into your performance reviews.

🔄 Missing a timely feedback system 

A system for collecting high-quality feedback from employees, managers, and peers is essential if you want your people to reach their full potential. 

Reviewers should take training and follow a clear set of standards to effectively deliver positive (reinforcement) and negative (redirecting) feedback. 

"Coaching or criticism is often misguided because it is mostly vague and ubiquitous. Feedback, however, is different because it is purposeful, contextual, knowledgeable, and organized." Shawn Persons, Director of Marketing at talent development platform AE Betancourt

The best choice? 360 reviews invite feedback from peers, managers, and direct reports for a holistic view of someone's performance.

💡 Solution: Zavvy's 360 feedback software is intuitive and fast to set up.

We provide pre-built survey templates created by our learning scientists to ensure qualitative data collection, which keeps feedback bias at bay.

💼 Lacking leadership commitment 

Creating an environment where feedback is normalized and given on the spot will require your leaders to be on board.

Get buy-in from leadership to deliver performance management conversations more than once per quarter.  

High-performing organizations take the CEO's lead and prioritize employee feedback to help them reach their full potential. 

💡 Solution: Zavvy encourages continuous development conversations and leadership training. We also create "management companions" for journeys and review cycles. 

👯🏿 Finding ways to improve team performance

Trust is one of the critical dimensions of high-performing teams, says Scott Keller, a senior partner at McKinsey.

Teamstage research finds that 25% of employees work 100% remotely and depend on virtual team building to foster cohesive relationships. 

You may use performance management conversations to:

• Build trust.
• Identify conflict.
• Spot opportunities to improve collaboration.

💡 Solution: Zavvy's Connection Program auto-connects colleagues for casual meetups, walking meetings, and meaningful conversations.

It's an effective way to boost team spirit and counter any remote isolation causing employee performance issues.

🤝 Building trust in the process 

Issues with trust between employees and managers can lead to the abandonment of formal performance management procedures. And, of course, the knock-on effect is employees disengaging further and an overall lack of productivity. 

Change leadership is key here to establish trust in the process. Making sure everyone feels listened to is essential for an ongoing successful performance management system.

💡Solution: Zavvy's change leadership training is delivered through a series of micro lessons to support leaders in managing employee performance during uncertain times.

➡️ Check out the 11 best ways to establish high-performance management in your company! 

➡️ Overcome performance management challenges with Zavvy

Do you want to create a high-performance culture strong enough to survive multiple global crises while staying ahead of the curve? 

Investing in your people through support, motivation, and continuous development is the way to do that. 

The first step is to identify your current employee performance management challenges. But remember, gathering valuable insights from your team members about your employee feedback system is essential too. 

Let the employee voice be a part of your approach to enhancing performance management! 

Next, Zavvy offers cutting-edge tools to supercharge your people development efforts: 

• 🌱 Employee development: put your team members in the driving seat of their performance, motivating them to reach new heights. 
• 🔁 360 feedback: use multi-directional, positive, or critical feedback to move away from stale performance reviews. Collect actionable feedback from multiple sources, including peers, direct reports, managers, customers, and business partners.
• 💼 Manager training: give your leaders the tools they need to enhance team performance. With frequent training, your managers will know exactly how to handle difficult performance situations, including mental health issues, salary disputes, and even layoffs. 

Take the first step in creating a supportive performance management program for your employees by booking a free demo of our suite today.