HR Blog | 7 March 2019

Why is Performance Management Important to Employees?

Overhead view of women working together

Performance management can sound like a strict monitoring system adopted only to put pressure on employees and force them to complete stretching amounts of work. The truth is, though, that any good manager knows this is an unfruitful method for creating a happy, healthy and productive working environment which leads to the best results. Many organisations choose to use performance management systems because they care for their employees and seek to create a positive office atmosphere based on healthy work habits. Here are just a few reasons why performance management is so important to employees.


Quite simply, many of us need deadlines and targets in order to actually get anything done. Setting goals and targets which are both challenging and realistic is a healthy way to stretch employees and motivate them to fulfill their potential, without making them feel like they are being taken advantage of. Everyone likes to feel the sense of accomplishment after having achieved something, which is only possible if you have actually been assigned something to achieve in the first place. On the contrary, if no development strategy is in place, an employee is likely to feel that their hard work goes unnoticed and will be unmotivated to keep it up, let alone to improve on their current performance.


It should also mobilise communication between individuals and teams, enabling line managers to engage more effectively with their team members. A good performance management system will allow those involved to see how particular tools and strategies are impacting performance and find the most effective working method for each employee. This way, any problems can be quickly addressed and resolved, avoiding employees working unhappily or inefficiently for an extended period of time without this coming to the attention of their line manager, which is likely to be the case if performance management is simply a matter of periodic appraisals.


Part and parcel of being motivated and encouraged by management is having an incentive to do well. For some, the knowledge that they’re good at their job is reward enough, but this is soon trampled underfoot when the workload becomes heavy and difficult. Tracking employees progress helps them and you see when they’re doing well, and knowing that their efforts will be rewarded is often just the motivation needed. Sometimes a simple compliment or word of encouragement is enough to help employees realise that their manager knows they’re working hard, and will therefore want to continue to do so. Performance management systems can also be used more formally by giving individuals clarity on what they need to achieve to be in with a chance of promotion. Equally, one-off treats such as a team lunch as a reward for good performance always go down well.

Performance management really is a positive thing for employers and employees, and making sure you have a good HR Software with performance management in place facilitates clear communication and promotes both motivation and reward. This is also beneficial to creating a positive working environment and fruitful labour from your team.