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Performance Management Employee Experience

Types of Performance Management Systems & Choosing the One for You

September 30, 2021
6 min read
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Performance Management, Supercharged


A performance management system is a vital part of human resources and people management. It’s essential for keeping employees on track, spotting high performers, and handling productivity issues. Performance management systems take you beyond basic employee reviews and into professional development territory, where employees — and your business — can flourish.

Executing your performance management strategy with software simplifies the process and keeps review cycles on track. It also generates valuable data your organization can use to gain new insight and improve its processes.

In today’s post, we’ll take a look at the types of performance management systems that you can implement. We’ll also address how you can decide which performance management system software will best support your approach.

95% of managers are dissatisfied with their company’s #performancemanagement system. If you’re one of them, your company might need a new system for #employeereviews. Find out in @ClearCompany’s latest post:

Types Of Performance Management Systems

Performance management systems refer to the way you assess employee performance, which includes their output, progress, and development. Most evaluation systems include both qualitative and quantitative elements for a well-rounded look at performance. That means employee performance should be measured both by the numbers, like sales goals and customer complaints resolved, but also on soft skills. Employees’ communication skills, teamwork, initiative, leadership qualities, and other intangible attributes are just as instrumental to their performance as hitting revenue targets.

The most effective systems go beyond the traditional once- or twice-a-year formal review, especially since only 14% of employees say their performance reviews are motivating. According to the same Gallup research, an incredible 95% of managers are dissatisfied with the current review process. Those statistics are a great reason to take a second look at your company’s performance management system and if it’s working for your employees.

Only 14% of employees are motivated by performance reviews — and 95% of managers are dissatisfied with the review process at their company.

There’s no such thing as one-size-fits-all when it comes to performance management systems. Your approach to performance evaluations depends on several factors. They include the size of your workforce, your industry, and the management styles at your company. You might even use different types of performance management systems for employees in different roles, or for specific projects or tasks.

There are many useful types of reviews that your performance management system can include:

  • Quarterly, Bi-Annual, or Annual Performance Reviews: While formal reviews are certainly not the be-all-end-all of performance management, they do serve a purpose. They ensure that regular formal feedback is given. They also offer an opportunity to discuss promotions, raises, and set new goals for the upcoming year.
  • New Hire Reviews (30-, 60-, and 90-Day Reviews): New hire reviews can give so much insight into the efficacy of your onboarding process. They also help managers quickly determine where new hires excel and where they need to improve before they are fully ramped. 
  • Competency and Roles Based Reviews: These reviews speak specifically to the employee’s success in their particular roles. They make it easy to compare the performance of employees in the same role. Managers can see trends and identify performance issues, addressing them before they become serious.
  • Time-Based Reviews: Time-based reviews ensure that managers and other contributing team members give timely feedback based on your company’s review cycle. Automatic reminders make it easy to stay on target and relieve HR of the monotonous task of individual reminders.
  • Peer and 360-Degree Reviews: Peer and 360-degree reviews add valuable perspective to employee evaluations. Peer reviews give management insight into how employees interact with each other and how they contribute to company culture.

How To Find The Right Performance Management System Software

It may seem daunting to keep track of so many different performance reviews. Not to mention, managers and HR teams want to analyze the results and compare them to past reviews. Fortunately, there’s a solution: performance management software!

There are several types of performance management system software to choose from. But, you want to be sure the software you choose supports your organizational goals. Your software should enable you to build the best system for your business:

  • Create custom performance reviews for highly practical assessments
  • Automatic reminders for reviewers and reviewees to keep on top of evaluation cycles and alleviate HR duties
  • Mobile reviews for fast, easy completion of performance appraisals
  • Real-time feedback and updates on goal progress
  • Robust analytics to track performance over time by department, manager, and individual team member
Goal planning, peer recognition, and employee surveys are important parts of an effective #performancemanagement system. Find out how software can support your company’s review process from @ClearCompany:

Many other useful software tools are integral to a balanced, effective performance management system:

  • Employee Surveys: Employee surveys can be used to gather feedback about many aspects of your company. Ask employees about their thoughts on diversity, equity, and inclusion initiatives or remote vs. in-office work. Survey results help your company learn what’s working and what’s not when it comes to workplace culture. The results can inform topics to address during performance reviews and create a culture of listening and transparency.
  • Goal Planning and Alignment: Setting individual goals that align with company goals clarifies expectations and responsibilities and leads to higher levels of employee engagement. That also makes it easier for managers to monitor progress and employees to complete goals successfully. Adding goals into your performance management system makes it obvious when goals are falling short. It also becomes clear when employees are going above and beyond.
  • Peer Recognition and Celebrations: 70% of employees say that recognition at work would motivate them and improve their morale. Recognizing employees for their hard work and celebrating accomplishments and milestones positively affects employee engagement, which leads to better performance. Plus, peer recognition can factor into performance evaluations as part of a well-rounded review system.

We know that more engaged employees are more productive and tend to be high performers or high-potential. We know that companies with engaged employees are 21% more profitable. We also know that employees and managers are not happy with traditional performance management systems, and crave straightforward, regular feedback. Your performance management process directly affects the success of your people and ultimately your business, and it’s important to get it right.

Luckily, the best performance management software for your business is out there. ClearCompany’s Performance Management and Employee Engagement suite offers all the tools you need. You can efficiently manage reviews, collect employee feedback, and empower your employees to do their best work. It’s no surprise that 86% of ClearCompany employees feel supported in their jobs and respected by management.

We’re here to help you find the most useful tool for your needs. Download our helpful Performance Management Buyer’s Guide for tips on vetting software solutions and choosing the best one for your business. 

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