A guide to people-centric performance management

The secret to improving employee performance

Businesses perform better when employees are healthy, motivated and focused. People-centric performance management works with this in mind, placing the individual at the heart of the performance process, balancing performance, career development, motivation, and wellbeing – to see and understand the whole picture.

Companies need to enable their employees to be at the top of their game, but they can’t do this with a blanket, one-size-fits-all approach to performance management. 

Every employee is different: they value different things, they’re at different stages of their lives, they have different strengths and weaknesses, and, crucially, what they want from their careers and personal development. At OpenBlend we don’t see this as a problem, but an advantage. When a business understands individual needs, strengths, and motivations and embeds this insight into 1:1s between managers and their team, it enables them to boost productivity and drive performance and development across the board.

What it means to be people-centric and how it can be established

Embracing a people-centric approach and mindset involves truly grasping the unique needs of the individuals in your team—the key ingredients for unlocking their best performance, providing the support essential for their work and career development, and nurturing a happy workplace culture.

In today’s world of work, professionals need support, empathy, and psychological safety as much as they do compensation, perks and the opportunity to develop in their careers. Focusing on the human aspect has become more important than ever to create a positive employee experience and it starts with:

1. Recognising the individual, their unique needs and motivations: Shift away from the concept of balancing work and life and focus on blending the two. We're not different people at work and home. By acknowledging ourselves, our colleagues, and our employees as complete individuals with unique personal and professional challenges, aspirations, and motivations, we can create an environment where everyone can bring their best selves to work.

2. Personalising management and development strategies to the individual: A people-centric workplace requires managers who can adapt their approach to each individual instead of relying on a standard set of expectations, frameworks and/or management methods. 

3. Honest, open 1:1 conversations: Water-cooler chats and project updates don't constitute meaningful 1:1 discussions. Being approachable and empathetic isn't enough; these conversations must be honest, open, structured, and accountable. A people-centric approach ensures effective 1:1 conversations are accessible to everyone.

4. Generating actionable outcomes with employee goals: During 1:1 discussions, managers and employees should strive to move forward by setting specific, measurable, achievable, relevant, and time-bound (SMART) goals. For instance, if an employee faces challenges meeting deadlines, a SMART goal could involve identifying the task in question, setting measurable progress targets, ensuring feasibility, aligning with the employee's responsibilities, and establishing a clear timeframe for completion.

5. Maximising potential regardless of circumstances: Consider a highly skilled employee who might be struggling due to personal circumstances that now make their contracted working hours a challenge. A not-so-people-centric approach might say "well that's what's required. Find a way to make it work" - which risks performance decline or talent loss. In a people-centric workplace, the efforts instead focus on accommodating the employee's needs, retaining that talent and devising a solution that works for both parties.

6. Providing support for managers and employees: Managers require the right mindset and support to embrace a people-centric approach. They need coaching to navigate conversations effectively, training to tackle the more sensitive management subjects, and the freedom to make decisions aligned with this approach. Likewise, employees need the opportunity to bring their agenda items to the table - for 1:1s to be effective, they cannot be one-sided. A structured framework for 1:1 conversations from both the manager and employee perspective ensures accountability, capability and progress.

According to LinkedIn's 2023 Workplace Learning Report: 83% of global organisations are looking to create a more people-centric culture and 81% of L&D departments are helping this to be achieved.

The power of 1:1 conversations

Employee needs are intrinsically linked to effective performance management.

Managers play a pivotal role in unlocking the full potential of their teams by understanding individual drivers, strengths, and motivators. This deeper understanding forms the foundation for meaningful 1:1 discussions that go beyond objectives. Shifting away from a tick-box approach to performance management, managers are empowered to adopt coaching-led actions, addressing key aspects like personal development, motivation, and wellbeing alongside performance reviews. This tailored approach is vital in promoting an environment where employees can truly perform at their best. Without this understanding of what drives and motivates their teams, they won’t be able to engage in effective, meaningful, and regular 1:1s with their employees, and by and large, the performance management process falls down.

A people-centric shift in performance management lies in recognising the intricate connection between individual aspirations and the collective success of the organisation. Where managers and the organisation as a whole have a solid awareness and understanding of their employees’ needs and drivers on an individual level, it represents a departure from a traditional, one-size-fits-all approach. Through effective, regular and consistent 1:1 conversations across the board, actionable solutions are created that enhance businesswide performance processes. It ensures employees feel valued and heard, provides clarity in goal setting, and improves collaboration and relationships between managers and their direct reports.

By placing employees at the heart of the performance process, 1:1 conversations become a powerful tool. This people-centric shift is revolutionary because it understands the unique contributions of each employee in driving organisational performance, connecting individual goals to qualitative and quantitative business outcomes and thereby reshaping the landscape of effective performance management.

Why is a people-centric approach necessary?

A people-centric approach to performance management provides tangible business outcomes that contribute to the continual success and growth of organisations:

It improves employee retention

Happy employees stay, and unhappy ones leave. If employees don’t feel valued or understood by their managers, they won’t stick around for long. 75% of resigning employees cite bad management as a reason for leaving. A people-centric approach supports businesses to connect their managers and their employees to create a culture of understanding, respect, and recognition that works both ways.

It encourages open and honest 1:1 conversation

People-centric performance management is all about great communication, but more importantly than that, it encourages your employees to talk openly and your managers to actively listen. Regular and structured 1:1s that focus on everything from weekly priorities and performance goals to key motivation drivers build trust between managers and employees, strengthen relationships, and facilitate a safe space where concerns and issues can be brought to light before they start to impact performance.

It has a positive impact on employee engagement and experience

If employees feel genuinely valued and perceive that their unique needs and motivations are understood, they gain a clearer understanding of their role within a larger team. Improving this sense of belonging amplifies engagement and enriches their overall experience. When individuals are more inclined to actively support and collaborate with wider teams, it speeds up workflows and cultivates a better employee experience all round.

It promotes diversity and inclusion

By approaching performance management with a people-centric mindset that caters to individual People-centric performance management strengths, motivations, and needs, it helps to create an inclusive workplace culture. This environment provides a platform for diverse perspectives and ensures each team member’s unique contributions are not only acknowledged but also valued and understood.

It improves manager capability and equips them with the skills they need to become effective leaders

A people-centric approach encourages understanding and a more effective way of leading that connects with the unique needs of each team member. As managers delve into the intricacies of individual motivations and drivers, they not only strengthen their management and leadership capabilities but also develop their skills in empathy and adaptability, fostering a workplace culture that prioritises both individual and collective success.

Because happier employees equal happier customers

Customer and employee satisfaction are two sides of the same coin and if building customer relationships is key for business, then so is employee happiness. When your employees feel happy, they will be better advocates for your business. With each fulfilled, balanced, happy employee, the benefits impact the quality of their work, their organisational contribution, and their overall performance.

It boosts employee productivity

When you understand your employees’ motivational drivers, you will better gauge what they need to be productive and work at their best. Whether that’s increased support, more training, flexible working arrangements or time for health and exercise.

5 key steps to guiding the process

Understanding the need to become a more people-centric workplace is the crucial first step to instigating change in how you approach performance management.

Here are 5 key steps to guiding the process: 

1. Self-assessment

Begin by evaluating your current performance and management strategies and identifying areas that require a more personalised approach. Delve into questions such as, “Where might we be falling short?” and “What aspects might we be overlooking in our current performance based appraisals?” This introspective analysis lays the groundwork to get the dialogue started.

2. Cultivate a mindset shift

Encourage leaders and managers to adopt a mindset that values the unique strengths, motivations, and challenges of each team member. This change in approach encourages a deeper understanding of individual dynamics, promoting a more inclusive and empathetic management style.

3. Invest in training and development

Equip managers with essential skills through targeted coaching sessions on effective communication, enabling them to tailor their approach to managing employee performance, including consideration of often overlooked elements like stress and wellbeing. Training may involve refining active listening skills and conducting mock performance 1:1s to enhance their ability to recognise and address unique needs and circumstances.

4. Look to HR tech

Tools such as OpenBlend embed a people-centric approach at all stages of the performance management process, playing a central role in facilitating structured 1:1 conversations between managers and team members. Providing an effective framework for seamlessly integrating individual needs, objectives, wellbeing, and motivation with performance objectives, recognition, reviews, feedback, and career progression within the performance management process.

5. Foster a culture of open, honest communication

Very rarely are people taught how to have and hold effective, honest conversations. Yet for a happy and trusting workplace, these skills are vital. Creating an environment that encourages open and honest dialogue between managers and employees and establishing regular channels for feedback and constructive performance discussion is key. OpenBlend’s conversation funnel is a framework that moves managers and employees through effective conversations in a structured way, creating tangible results and better relationships. The funnel helps managers and employees to prepare for and organise 1:1s, guided by coaching principles that drive forward action.

The principles of performance management align the success of employees with that of an organisation, maximising the value they create.

However, it’s no longer sufficient to simply tie organisational objectives to individual goals; understanding what each individual needs to perform at their best requires a people-centric approach.

Recognising the need for change is a powerful step toward facilitating change. Discover how great 1:1 conversations drive great performance and book a discovery call with OpenBlend today.