What is Performance Alignment & How to Shift from Performance Management

December 4, 2023
What is Performance Alignment & How to Shift from Performance Management

What Is Performance Alignment, and Why Is It Important? 

Here's what you need to know: 

  • Performance alignment helps ensure that all of your employees are meaningfully working towards your organization's goals
  • With performance alignment, you’re concerned with how your team’s work ladders up to the company’s ultimate goals and larger vision
  • There has to be clear and consistent communication from the top down on evolving company’s goals
  • Feedback should be continuous; employees need to be clued into shifts and changes as they happen

There’s a reason that the tires on your car have to be aligned: If one component is out of sync with the rest, it’s impossible to move forward efficiently (if at all). In this way, businesses are like cars — there has to be alignment across teams and sectors. In pretty much every other way, companies are entirely different because there’s more than just four tires to harmonize. 

Maybe you’ve spent all kinds of time focusing on performance management and performance alignment is something of a new idea for you. Perhaps you’ve been hearing plenty about performance alignment and its benefits, but aren’t sure how to bring the practice into your specific small business. Regardless, here’s a crash course on the basics of performance alignment. 

What is performance alignment?

Performance alignment is essentially ensuring that all of your employees across the company are meaningfully working towards the organization’s goals. Believe it or not, the idea has been around for years!

For smaller companies, chances are performance alignment isn’t something you’ve thought much about before. This is likely because it happens more or less organically within a small team. If you’re a crew of just a dozen or so people all working side by side in a coworking space, it’s pretty easy to get and remain aligned.

Things change, though, when your company changes. As you grow and expand and are no longer working in close proximity with every employee, it’s easy to see how alignment with the company’s larger vision and goals can slip. It’s not that people are purposefully going off course, it’s that it takes a lot of intentional effort to keep a growing or larger company aligned. And that’s pretty different from performance management.

Shifting From Performance Management to Performance Alignment

Moving from performance management to performance alignment is a surefire way to boost productivity and make sure you are on the right track.

Excellent performance management practices can keep your team engaged — but it may not be enough to reach your objectives. You also need to ensure that their performance is aligned with company objectives.

Shifting from a performance management perspective to performance alignment is easier than you would expect. You simply need to review your workplace culture through the lens of alignment and make strategic decisions that will enhance your performance, and ensure that everyone in your company is focused on the same goal.

In addition, spending energy on alignment brings additional benefits, including fostering employee engagement, collaboration, improved feedback, and streamlined systems.

But before we jump into how you can begin to focus on performance alignment, let’s look at the differences and similarities between alignment and performance management.

Performance management vs. Performance alignment

Performance management is when you create and maintain a work environment that encourages productivity and employee engagement. This includes setting clear job descriptions and expectations, efficiently onboarding new hires, offering feedback, and designing effective benefits packages.

Performance alignment is a bit different. When you are working on performance alignment, you are ensuring that your employees are working in conjunction with organizational goals.

Both performance management and alignment deal to some degree with creating an inclusive and productive company culture. But alignment focuses more on creating not just a productive environment, but one with clear direction and expectations.

Compare the differences in mindset when asking questions about your organization and current performance.

The problem is that as your organization grows, it becomes difficult to ensure that your teams are aligned with your overall objectives and can execute them. The good news is that it’s far from impossible to align your employees’ performance with your company goals and culture.

If you can get performance alignment right, it pays off.

The benefits of performance alignment

Performance alignment has several benefits. Not only does alignment help employees better execute their tasks, it gives them clear benchmarks — which gives them a better sense of involvement. When priorities and responsibilities are clarified, work becomes streamlined. And you open the door for increased engagement, boosted productivity, and greater satisfaction for both employees and managers — all while getting work done.

Who needs to be involved?

When it comes to performance alignment, everyone really needs to participate. HR, owners, managers, and staff across departments are all important and play a part.

As we’ll see in this guide, communication and regular feedback across all levels play a large part in ensuring that employee performance is mirroring company objectives.

11 steps to shift towards performance alignment

When it comes moving more towards performance alignment, there are several things to consider. Some aspects may overlap with general performance management. Ideally, you’ll take stock of your current performance management and see where you need to make changes.

Before we jump in, it can be helpful to already have a solid performance management system in place. While you will notice some overlap between the 2 concepts, it can help to have already established:

  • Clear communication channels between managers and employees
  • Continuous feedback approaches rather than annual reviews
  • Digitized and extensive onboarding and new hire training

If you haven’t made the shift to these practices yet, that’s okay. You can include them in your alignment strategy.

1. Understand your organization

First, it’s essential that organizational objectives are clear and concise. It would be impossible for managers and employees to follow them otherwise. In addition to the employee handbook, consider keeping a clear 1-page list that includes your organization’s mission statement and current goals.

But you also need to better understand your company’s structure. Traditionally, organizations use a top-down structure, with complex and siloed hierarchies and decisions filtering from the C-suite down to local teams. Mapping out your company’s structure can better help you understand where you can create clear and consistent communication channels between departments and levels.

2. Take stock of your employees’ performance

Secondly, you’ll want to review your current employees and their performance. Before you can begin to understand where you need to realign, you need to better understand who you already have on your team and their challenges. This can help you understand if you need to:

  • Bring on more workers
  • Offer training initiatives, or
  • Make other changes that can make a difference in regards to productivity and engagement

Since a key aspect of performance alignment is helping employees make decisions that not only benefit their current team but the overall company mission, this part is crucial.

Having a strong performance management system in place can help you with performance alignment. Otherwise, you’ll need to start your system from scratch. To boost your current system, managers can:

  • Ensure that they are using continuous feedback models. Managers that regularly check-in on their employees have workers that are three times more engaged.
  • Recognize your employees often. 69% of employees say that recognition will help them work harder. And employees will better appreciate their managers.
  • Keep communication channels open and convenient. This can be as simple as keeping your office door open or having a Slack channel.
  • Offer employees the chance to hone their skills.

3. Focus on your managers

First and foremost, performance alignment is not about HR. Not really. For an effective performance management and alignment system, you really need to have managers on board with any changes that need to be made. And since managers also directly supervise employees, you’ll want to ensure that they fully understand your organizational objectives.

If you are a local business with a small staff and no general manager, you’ll want to delegate more employees. This helps you on 2 fronts. First, delegating tasks to employees boosts their engagement and productivity. Second, it frees up more time for you or your manager to focus on more important organizational tasks.

In addition to the delegation, you should also encourage innovation and give your managers or star employees more room to make on-the-spot decisions. This gives them a stronger feeling of responsibility and allows them to make changes that make sense for their specific team or situation.

4. Link employee goals to company objectives

Next, you’ll want to have one-on-one discussions with every employee. During this session, you can better understand their challenges and gain their perspective. In doing this, you can better link company objectives to their daily work routine and their overall career objectives.

Some tips for better bringing employees into the fold are:

  • Allowing employees to set sub-goals for their work rather than monitoring efficiency based on hours or long-term goals.
  • Focus on employee training and supporting their goals.
  • Avoid incentives. This may seem counterintuitive, but incentives usually only contribute to temporary behaviors, and won’t affect employee productivity in the long term.

But there’s another benefit to linking employee goals with company objectives. Aligning employee goals with the company mission will likely boost their engagement. Engaged employees generally have higher productivity, better customer service, and lower rates of absenteeism. In addition, an engaged workplace is 21% more profitable.

5. Foster a welcoming and productive work environment

Remember how we said performance management is about creating a productive and positive work environment? Once you’ve gotten feedback from your employees and managers, it’s time to start acting on their information. Enhancing your work environment will only help your employees better devote their time to their objectives.

But that’s not all. You’ll also want to regularly recognize employee achievements in and outside of work, and ensure that teams and departments have opportunities to communicate and bond. While this doesn’t seem to directly relate to performance, ensuring that departments aren’t siloed is a great way to boost productivity, motivation, and company culture. This, in turn, is likely to help your employees better align with the overall mission.

There are also other techniques you can use to boost office performance and focus. Some ideas include:

  • Reducing clutter
  • Adding greenery to your office
  • Use natural lighting wherever possible
  • Ensure that every meeting has a purpose
  • Take advantage of project management tools

You may also want to encourage both employees and managers to track their time. Be clear that it isn’t mandatory and it won’t factor into their performance reviews. However, tracking time can be a great way for individual employees to monitor their own productivity and better manage their time. For example, multi-tasking without tracking time can reduce productivity by over 40%. Even if timesheets won’t be officially used, your employees will definitely benefit from seeing how they actually spend their time.

6. Invest in your employee skills

Next, you’ll want to reinvest in your employees. Assisting your employees through training, reskilling, or upskilling is an excellent way to both motivate them while also realigning their abilities to match their work objectives. And the numbers back this up.

40% of employees will leave a company due to poor training within a year. Yet companies who invest in training may not only keep more employees, they’ll also see up to a 24% revenue boost.

Training and investing in furthering your employees’ careers not only benefits them but what they learn comes back to the company. Which means you may be more likely to reach your objectives faster.

Nowadays there are many ways you can provide training options to your employees. You can:

  • Create a company-based mentorship program to help new employees learn from established members.
  • Invest in online platforms and courses that your employees can use.
  • Host optional meetings with key speakers on specific topics or technologies.

7. Boost collaboration

Collaboration is the key to success. To ensure fluid communication and full productivity, it’s important that it’s not just employees who are working together. Managers should also be collaborating with their team, and different departments should have solid methods of communication.

To further your collaboration efforts, you may want to:

  • Set up a workflow that makes sense for your team.
  • Use digital communication and project management tools. Digital collaboration tools can boost productivity by 30%.
  • Ensure you have activities throughout the year meant to boost employee relationships.
  • Ensure that every meeting has an agenda to prevent time wasters.
  • Allow your employees to work from different areas of the office. Or even work from home.

Don’t forget that collaboration and clear communication starts with point 5: fostering a welcoming work environment. If an employee feels that the office is an open and welcoming place, they are more likely to interact with coworkers and create innovative solutions without losing sight of the main organizational goal.

8. Revise onboarding and recruiting

You may decide you need to bring on new hires. This means your recruiting and onboarding process should begin with the end in mind. What kind of employees do your managers need and how well do their skills and personality match your organizational objectives? And where do you need to fill in the gaps?

When it comes to recruiting, you need to focus on clear and concise job descriptions that mirror your organizational objectives.

Onboarding is a bit more intensive.

Getting onboarding right is critical. It may surprise you to know that 60% of companies fail to provide new hires with milestones. This means alignment isn’t even in the picture — these new hires don’t even have a general objective to measure productivity. But investing in your onboarding process brings clear rewards. With a standard process, you can observe up to a 50% greater productivity level from new hires. And managers stay happy, too — with a 20% increased satisfaction rate when an organization has a solid onboarding program.

In other words, performance alignment isn’t something reserved for more established employees. Your new hires need to understand how they connect to the company’s overall objectives from day one.

To make things easier, it can help to have a streamlined onboarding process that includes extensive training and an introduction to company culture.

9. Realign your benefits

It’s also important to reassess your benefits packages. Helping your employees by providing benefits that match their needs can help increase their productivity and allow them to better focus on company objectives.

Some ideas for benefits that won’t break the budget outside of healthcare are childcare, flexible working hours, birthdays off, mental health days, and working from home. What you end up choosing will entirely depend on your workforce. But ensuring that your benefits match the needs of your employees is a surefire way to improve performance, productivity, and confirm company culture.

If you rely on independent contracts, you can also offer portable benefits. Some examples include:

  • 401(k) contributions
  • Healthcare stipends

10. Go digital

There’s a lot of paperwork. And if you add in performance feedback, it’s easy to be overwhelmed.

Digitizing your performance management system is one way to make alignment easy for everyone involved. It’s possible to integrate continuous feedback, peer reviews, organization hierarchies, benefits enrollment, and onboarding to create a seamless experience for managers and employees alike.

There’s several benefits to shift to a digital performance management platform besides saving time:

  • Real-time data allows decision-makers to stay on top of trends and potential challenges
  • You can easily and accurately spot areas for improvement
  • Digital footprints can help businesses in case of legal action
  • Performance progress is transparent and easily updated
  • You can better measure performance with KPIs and link it to qualitative data, like employee and customer feedback

Using a digital platform makes it easy to realign performance as your objectives change. And going digital is the perfect way to streamline your operations and spend less time doing busywork.

11. Reevaluate regularly

Finally, performance management and alignment aren’t one-time deals. You’ll want to evaluate and readjust regularly. The good news is that continuous feedback and communication with employees is a great way to motivate them.

Weekly one-on-one chats, group meetings, and quarterly reviews are just some ways you can check in to ensure everything is working smoothly. And if you’re working with an online platform, you can automate scheduling and feedback so that you have more time to focus on strategizing instead of collecting data.

But your only focus shouldn’t be on feedback. While regular feedback is crucial for success, you’ll also want to watch for changes in company mission and goals. You’ll want to also shift your performance strategy when necessary. When you need to realign employee performance, you’ll want to explain the changes one-on-one and in a group, as well as try to relink employee goals to the new objective.

Remember that performance alignment is a regular process

After all is said and done, it’s important to remember that performance alignment is an ever-evolving journey.

As organizational objectives change, you may find yourself realigning performance goals. And depending on your team, you may need to tweak performance management tactics. However, a competent performance alignment system can provide serious long-term dividends.

Increased employee engagement, higher retention, boosted revenue, and a better understanding of your organization are just a few of the byproducts of organizational alignment. Even if your company’s mission changes over time, having a solid performance alignment process will allow you to quickly adapt your organization to meet any challenge and achieve your goals.

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