What is Performance Management?

In a business which wants to thrive, all your staff need to be pulling in the same direction.

Most people assume that performance management is something which happens to an employee when they are failing to ‘perform’ at the required level. However, when performance is properly and pro-actively managed, there are a number of elements which form performance management and these start before the employee has even joined the business.


  1. Job Description – this sets out the role which needs to be done and the expectations of the employer
  2. Person Specification – this will usually contain the skills and qualifications the person needs to have to be successful in the role
  3. Job Advert – this should pull out the key elements of the Job Description and the Person Specification to attract the right people to apply
  4. Selection Process – this should utilise a number of stages such as telephone interview, face to face interview and / or skills assessment to determine the best person to do the job.
  5. Contract of Employment – Most people will not consider this a Performance Management tool, but it is exactly that. A well written contract of employment will give the employer a mandate to manage and will clearly lay out expectations. It also tells the employee what they can expect from you in exchange.

You are already managing the performance of your workforce if you work hard to ensure you have the right person, in the right role, doing the job which you actually need doing.

New Starter

  1. A robust induction plan is needed for each employee. It should ensure the new starter hits the floor running and may include elements such as health and safety, IT, security as well as an introduction to the company, the department, colleagues and their line manager. A induction period could last for 4 weeks while the employee understands what the business does and how they fit into the bigger picture.
  2. A six-month probation period is our recommendation for all staff at all levels within all businesses. Although this may seem excessive, the employee is still fully employed in this time and is entitled to holiday etc. but it allows both the employee and the employer to ensure that the ‘fit’ it right. This is in terms of job, culture, skills and personality. It takes a while to train people up and then you need to ensure that they can perform.
  3. Reviewing performance during the probation period is essential and we suggest that formal monthly meetings take place and are documented. These provide you with an opportunity to get off the day-to-day rat wheel and to take a step back to honestly review progress, identify further training needs and address any concerns. Just as the probation period is a two-way process, so are probation review meetings.
  4. The End of Probation Review Meeting should take place somewhere between month 5 and 6. The possible outcomes of this meeting are:
    1. fail probation and the employee is served with notice in line with their contract of employment;
    2. extend probation because the employee is not quite performing at the necessary level, but both the employer and the employee agree that they should be able to achieve the required standard within a certain time period – this is typically three months, but can be more or less. It is vital this is confirmed in writing and the employee is crystal clear about what they need to achieve during any extended probation period;
    3. pass the probation period and confirm this in writing with effect from the six month date. In some cases a pay increase or improved benefits are available and this should be confirmed in writing when the probation period is confirmed as being ‘passed’.

A couple of things to note here:

  • The employee is often on a shorter notice period during their probation period, but this MUST be confirmed in their contract of employment which must be given to them on or before day 1.
  • As an employer, if you do not feel that the employee is going to make the grade, or there is a specific incident which indicates they are wrong for your business, you do not need to wait for a formal probation meeting or for the ‘end of probation review meeting’, you can terminate at any time – as long as you comply with your company policies and procedures and pay what is required.
  • The probation period is also the time when you should be getting references, checking a person’s right to work (ideally needs to be done prior to employment) and getting their paperwork in place such as licences, DBS check etc. if relevant to your business. It is possible that you may need to terminate based on them failing any of their employment checks.

Established Employee

Performance Management does not end once the employee has passed their probation period. You need to continue to nurture employees, enable them to grow and ensure they are engaged with your business. Businesses do this in a number of ways:

  1. Weekly one to one meetings with line managers are a great way to check in on a regular basis and identify any issues as and when they occur. Not all managers are available to staff all the time and knowing that there is a regular check in point can be really useful. The exact nature of these meetings will vary depending on the business, the role and the experience of the manager and the employee. It is not necessary to keep comprehensive notes, but if you are agreeing actions or have concerns, these should be documented.
  2. Mid-year review meetings are a much more formal meeting where goals and objectives can be reviewed and updated and redocumented if required. In most businesses a lot changes in six months and therefore keeping objectives SMART is really important for employee and business success. Some mid year reviews take place six months after the end of the probation period and work on a cycle based on date of commencement, but in other organisations there will be calendar based dates for mid and end of year reviews – perhaps tied in with financial results or financial year end.
  3. End of year appraisals – the Dreaded Appraisal‼! If everything else is in place, then the appraisal should not be so dreaded. There should be no surprises and it should be a really positive conversation about what the employee wants from the coming year, more training, more development, less pressure, less hours, more responsibility etc.

It is also a time to set objectives and we recommend a mixture of both business and personal development objectives. They must be SMART (Specific, Measurable, Achievable, Relevant and Time-bound) and documented. Some companies will have an electronic system for keeping copies on file, for other companies it will be bits of paper.

The conversation needs to be documented and both parties need to sign to agree the contents of the meeting. It is not always possible for both parties to agree on performance standards, but the discussion which took place should be agreed. The employee should be able to write their comments on the form and the manager will then usually add their comments. Both parties should keep a copy of the appraisal, especially if there are objectives and Key Performance Indicators which they should be working towards.

Good Performing Employees

As I said earlier, most people assume that performance management is for poor performing employees, but that isn’t the case. As a manager or business owner, your job is to manage the performance of all your staff and to get even better results out of your top talent.

What can you do to support them? What can you do to encourage them? What can you do to reward or incentivise them? How do you show your appreciation so that they want to perform even better?

Poor Performing Employees

These employees should know who they are, without you having to tell them. Your job is not to scold. You are not a schoolteacher or a parent. You must remember you are dealing with adults and show them the respect they deserve.

Support, nurture, train, develop.

Are they a ‘won’t do’ or a ‘can’t do’?

If they’re a ‘won’t do’, you need to activate your company disciplinary policy.

If they’re a ‘can’t do’, you need to activate your company capability management policy.


Whatever you do, you must follow a proper process, or you will be at fault and regardless of the issues, you could find yourself trying to defend the business in an employment tribunal. This is a harsh reality and with no barriers to ensure only genuine claims reach the Employment Tribunals, the number of claims is on the increase.