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Tuesday, January 27, 2015

Understanding the Way Minds Work: Think Like a CLO

If you could reduce a good performance management system down to ONE element (hint: you can’t), it would be the ability to allow organizations and managers to train and develop their employees in a free learning environment while maintaining an understanding of where employees rest on the learning curve. An environment that cultivates a desire for more knowledge and experience clearly benefits the employees and the organization as it can improve employee performance by up to 14%.

But how do training and development dovetail into a vibrant learning culture? Both aspects of employee development go hand-in-hand; just because your organization has a learning atmosphere doesn’t necessarily mean the training and development are as robust as they should be. Cultivating employees through performance management inspired training begins to create a learning culture in a cyclic motion of development. While each needs the other to survive, one does not automatically imply the other. Here’s how to get them working in sync.


The inundation of technology has changed the way companies train their teams. Using games as a way to teach employees industry and organizational standards is now more commonplace than ever before. Gamification takes traditional workplace training and situates it in a virtual game. This increases the hard feedback for workers and allows employers to track and document employee progress in their performance management systems. 73.6% of the training provided to Fortune 500 employees is through online methods. While not technically gamification, many enterprises are heading in that direction.

Structural and serious game simulations are used to engage and motivate employees to learn better practices or change work behavior. Structural game characteristics are more popular than serious game simulations (25% and 19%, respectively), and help employees reinforce or practice skills to increase performance.

Training can’t all be fun and games...or can it? While there are one off skills that must be taught one-to-one, organizations like Evault are turning to exciting platforms to teach and engage and are trying to discuss what a real learning and gamification platform looks like:

The program is exactly what Dorothy Serdar had hoped it would be: consistent, comprehensive, efficient, interactive and, according to employees, highly engaging, if not downright fun. “The biggest positive statement is how much they learned in a short period of time,” she says. Read more about how Evault (and other companies) are using gamification both on and offline to teach and train new hires.


Informal learning is inextricably linked to training and formal learning. Informal learning provides a context for what employees glean from the company’s formal training programs. Saul Carliner (@saulcarliner), Research Director at Lakewood Media Group, said:

“One of the advantages of formal learning is its efficiency. With prescribed objectives, structured learning activities, and built-in feedback, workers can master one or more work-related responsibilities in a brief period of time. Formal learning lacks context, however.”

However linked they may be, training and informal learning are different. Training and formal learning spark instances for informal learning. Employees can take the information learned in the corporate classroom and put them into practice. The differences in formal and informal learning are based on:

  • Who is in control of the learning and assesses its effectiveness
  • Where the learning happens (i.e., in the classroom or outside the cubicle)
  • If the learning was the primary objective or a byproduct of an activity
  • How much of the learning material is conceptual or contextual

Part of the difficulty is dealing with learning initiatives is the inability of different business units to measure it consistently. Consider this insight from Jay Cross, an informal learning champion:

In 2001, training directors turned their attention to return on investment. Unfortunately, instead of learning cost-benefit analysis, people who wanted to speak the language of business studied accounting. Created long before knowledge work was invented, accounting values intangibles such as human capital at zero and counts training as an expense instead of an investment.


Employers are responsible, in part, for the cultivation of their employees’ skills and assets. They are not, however, solely responsible for developing the future of their entire team. Employees take the knowledge and experience they’ve gained from an organization and use it to build their careers. One of the biggest issue companies have in engaging their teams is creating an atmosphere that develops management and leadership when employees are overwhelmed with their workloads. Company leadership and the environment they promote within the office are two driving factors behind employee development. Josh Bersin (@Josh_Bersin), Founder of Bersin by Deloitte, said:

“‘Best places to work’ companies don’t just have ping pong tables and free lunch, they have a ‘soul’ which makes work exciting and energizing. They invest in great management and leadership. They train and develop people so they can grow. And they define their business in a way that brings meaning and purpose to the organization.”

Because training and informal learning are so connected, informal learning is a direct result of the complexity and effectiveness of the training program. Subsequently, employee development is a combination of the formal training, informal learning sessions, and how employees use this knowledge in their work to increase performance. Formal training programs have to be robust in order to see results in performance management and better outcomes in performance appraisals. It becomes cyclical: a learning culture is the culmination of the formal training, informal learning, and the development that happens when employees are able to apply their training to their jobs.

How are you implementing training within your workforce? If you had to classify your initiatives, would they be training, learning, development focused? Would they be formal or informal? Do you practice new fangled or old school gamification? Let us know in the comments.

Tuesday, January 20, 2015

How to Keep Track of Organizational Goals with Performance Management

Some people make lists, others put sticky notes on their computer screen, and many simply fly by the seat of their pants. It's not easy to keep track of work resolutions, especially when they are long term as resolutions tend to be. At work when deadlines begin to pile up and projects are coming out of your ears, finding time to work towards keeping your goals on track is near impossible. But don't worry, your team doesn't have to do it entirely alone.

What tools can help track goals?

Over the last few years, technology has exploded. Between the tablets, phablets, and smartphones… even your car talks to you now. With all of these pieces of technology, there's undoubtedly "an app for that" that also translates to your Tools like Microsoft Office 365, Dropbox, and Trello. These apps can help you and your team stay on task while making the most of available time. Trello, for example, separates responsibilities by importance to keep projects streamlined and the office organized.Microsoft Office 365 and Dropbox allow your team to use their mobile devices to access work documents without the constraints of a desktop computer.

While technology (i.e., big data, analytics, tracking) is necessary in today’s business world, disruptive technologies (i.e., social media, personal devices, email) can impede the success of goal setting and maintenance. Josh Bersin (@Josh_Bersin), Principal and Founder of Bersin by Deloitte said: 

“Agile software was the beginning of the era of greater transparency and continuous feedback. Now we have social media everywhere, which promotes even greater visibility into the everyday lives of everyone around us. The other trend driving this is a strong focus on analytics. Open discussion, regular check-ins, big data, and greater awareness are now part of every business and when you pair those activities with company-wide, quarterly goal setting processes - organizations can see 30-40 percent greater returns.” 

What can the workload handle?

Perhaps most importantly, employees have to understand their work capacity. The biggest issue with these newfound hopes of a brighter and more productive year is that all too often the goals are lofty. Take a look at the average workday breakdown:

      44.5% of the day spent on primary job duties
      13.8% of the day spent on reading and responding to emails
      12% of the day spent on administrative tasks
      9.3% of the day spent in useful meetings
      7.7% of the day dealing with interruptions
      6.9% of the day wasted in useless meetings.

That leaves a grand total of 5.7% of the day for special projects, working towards goals, and everything else. Adding lofty aspirations to the list of daily activities leaves your team inundated with a workload they might not be able to handle. 

This is yet another reason why accurate performance appraisals are so crucial to business development and employee growth. Two-thirds of highly rated employees are not the top performers, so inaccurate appraisals could give them disproportionate time at work for more goals than they can reasonably achieve. 

What is the manager’s role?

Productivity and engagement start with the right attitude. Employees have to do more than simply show up to work... they have to actually show up. While employees are their biggest critics, sometimes they need a little help getting motivated to accomplish their goals. Whether it's faith in their own personal brand or how that aligns with the organization, a little "Nice work! This turned out great with the limited time you had," or, "This is great, but it still needs some attention in these areas," are examples of simple continuous feedback. However, there are other more involved ways managers can motivate the team before failing to meet a goal.

      Clearly define expectations - It’s a natural propensity for people to mentally wander. However, if you give employees direction, their goals will align with your expectations for development. Understand how your employees work and what their limits are so new goals don’t push them too far.

      Believe in your team - Employees are more likely to perform well if they know their supervisor has faith in their performance.

      Praise and correct appropriately - Nothing is quite as demotivating as public criticism. More often than not, employees are unaware of shortcomings, and they certainly don’t need to be altered to them in front of their team. On the same note, while private praise is appreciated, it’s not as effective as doing it publicly. 

No matter what your role in the company, it’s part of your job to help your employees and coworkers reach their work objectives. While it’s not your responsibility to micromanage their every task, you do have to help them understand how to manage their daily performance requirements and goal maintenance simultaneously. Performance appraisals, goal tracking software and apps, and clear motivation from supervisors all play a role in helping your team reach their goals this year in the office. 

Keeping goals on track is a team effort; don’t let your team do it alone.
Take a demo of our performance management software to see how you can streamline this process.

Tuesday, January 13, 2015

How to Grow Part 3: Rethink Annual Performance Appraisals

It’s 1:53 pm, which means Adam has 7 minutes to prepare for his annual performance appraisal. He was so busy working on this last major report he lost track of time. As he walks to his supervisor’s office door, the butterflies set in deeper and deeper in his stomach with each passing step. Why?

Because the annual performance appraisal could mean a raise, punishment, or - heaven forbid - be the first step in the long road to being “let go”. He feels like he’s performed well throughout the last year, well above par, but he doesn’t know if his supervisor feels the same way. As Adam quickly conducts a self performance appraisal in his head, he becomes increasingly anxious about his impending performance appraisal. He walks into his supervisors office and…

Let’s be honest. Annual performance appraisals can scare employees. They are expected to understand the ramifications of their performance over the last year and prepare for their performance over the next 365 days. Considering that’s an average of about 2,000 working hours, we can assume that employees won’t remember everything they were told during their annual performance appraisal. Moreover, the infrequency of the review makes it a much more daunting practice. So, how can employers take the uncertainty, anxiety, and ultimate ineffectiveness out of the traditional annual performance appraisal? It’s time to rethink the way companies conduct employee feedback.

Frequency: Maybe lose the annual bit?

Communication is key to a successful team, right? Well, annual performance appraisals limit the dedicated opportunities for employees to have an open discussion with their supervisors about their work. Increasing the frequency of performance appraisals will broaden employee’s goals and actualize where their work fits into organizational objectives. The problem with traditional employee performance appraisals is that they spark a “fight or flight” response in the human brain. 

This fight or flight reflex causes colleagues to work against each other. In fact, it can negate the thoughtful and collaborative atmosphere needed to improve performance. Guided conversations during reviews are more effective in getting employees involved in the discussion. The active participation decreases the stress of the event and increases performance improvement thereafter.



How to Grow Part 1: Performance Management in 3… 2… briefly touched on performance appraisals as a key aspect in corporate talent management. To grow on that point, a primary fear facet of appraisals is simply the lack of reviewing the employee’s performance. Part 1 said:

“Is it really a performance appraisal if it doesn’t truly identify performance? The answer is no. In fact, performance appraisals are sometimes wildly erroneous and can lead to more performance problems than they actually solve. For example, two-thirds of employees who receive the highest marks during their performance appraisal are quite frankly not the organization’s top performers.”

In essence, when employees are unaware of specific points of poor or good performance, it can lead to anxiety between reviews. If employees are not given the tools they need to solve - much less identify - problems, they can’t be expected to fix performance issues. As an effort to dismiss fear from the appraisal process, remember this formula:

      Recognize good and poor performance = Objectivity
      Identify problems and offer solutions = Ownership
      Tracking development and maintenance = Growth

The Road Ahead

Organizations, albeit changing slowly, have begun the process of altering their current performance appraisal programs to see better results. Currently, 39% of companies already reviewed and changed their performance management within the last 18 months. Another 31% are in the process of evaluating their system. Companies like Adobe have already changed their appraisal programs, and have seen a development in the effectiveness of the feedback.

Tweet This: 39% of companies have changed their performance management within the last 18 months. 

Employee performance appraisals don’t have to be scary. They aren’t meant to be punishment; the goal is to monitor growth and performance of each employee and augment it accordingly. Raise the number of times per year management evaluates employee performance. The results include, but are not limited to: decreased appraisal anxiety, increased effectiveness, and better communication up and down the leadership ladder to successfully reach goals. Help your employees help you. Provide better performance appraisals with guided discussion versus strict guidelines that don’t allow room for open communication. The road ahead looks promising, it’s time to get on the right path. 

Watch a demo of Reviewsnap's performance appraisal software to get started.

Don’t miss out on the rest of this series:

Tuesday, January 6, 2015

How to Grow Part 2: Compensation Motivation

There are a wide variety of compensation plans in the corporate world, but if you’re a startup which one is the best option? When you’re looking to grow your team, it can be overwhelming deciding how to compensate your future employees while taking the compensation thresholds of your current employees into consideration. But know this: when employees understand how their achievements are valued and rewarded accordingly, motivation and engagement improve. Keep these things in mind when planning compensation for 2015

Good Job! Here’s Your Bonus

Typically a lump sum (year-end bonuses) are one tool that makes up total compensation. In fact, they made up 12.7% of payroll budgets last year. Year-end bonuses are more easily tailored to the specific job role compared to some other compensation rewards. While it’s easy for employers to lump the entirety of the bonus at one time - instead of a steady and consistent raise in base pay - how do employees feel about it?

Typically, employees are more receptive to the lump-sum bonus simply because the 1-3% raise doesn’t feel like much spread throughout the year. Bonuses tend to make employees feel more appreciated and subsequently, more engaged at work. When employees are recognized for good work - as positive reinforcement would dictate - they are more likely to continue that behavior. Consider a bonus for your employees if you are a lean startup and have year-end revenues or cash on hand. Remember that just like any compensation, your employees are required to report this on their taxes. 

Tweet This: Bonuses tend to make employees feel more appreciated and subsequently, more engaged at work. @Reviewsnap

Great Performance! We Just Don’t Have Much Cash…

Startups don’t always have the necessary funding to facilitate the typical year-end bonus or even an increase in pay throughout the year. Don’t worry, that doesn’t mean you can’t reward employees financially for their exceptional work. As a small organization, you can offer stock incentives as an alternative to a direct cash bonus. Now, there are different options for stock incentive plans. Nonqualified, restricted, and performance shares are just a few examples. 

At larger firms, stock incentives have become an increasingly popular means of motivation, albeit long-term compensation reward systems, for their employees. These organizations offer two types of stock rewards: 88% offer restricted stock and 64% offer stock options. Just because they are larger companies isn’t to say you can’t offer similar rewards for your small organization. You could translate that Wall Street stock into something more transparent for your company. Give employees room to gain emotional or professional “stock” in their work, their team, and their participation in the organization as a whole. Using ownership in the company (how you structure it) is a great way to keep senior level employees invested in the growth of the company and can be used as a recruiting tool when communicated properly.

Share on LinkedIn: Give employees room to gain emotional or professional “stock” in their work, their team, and their participation in the organization as a whole.

Outstanding Work! Keep it Up

Merit-based raises don’t have to be just money. That’s right… a raise doesn’t have to have a dollar symbol before it. Non-monetary benefits such as extra paid time off or even the coveted desk with a view of the skyline can instigate higher motivation depending upon the needs and wants of employees. While they don’t have to strictly consist of monetary rewards, organizations can offer a choice in a merit-based raise. If you have the financial wiggle room, give high-performing employees the option. Would you like X days extra PTO or X% raise for your outstanding work on last year’s project? Claire Bissot, former HR Consulting Manager at CBIZ Human Capital Services, said:

“HR people should be getting more creative in this area. We’re definitely seeing less extravagant rewards, and seeing more employees in non-executive and non-sales positions being recognized through reward programs with points, or with additional vacation days, for example.”

The use of incentive compensation is changing. Take a gander at the new scenery… what do you see? Stock options, vacation days, cash… Incentives like bonuses, stock incentives, and some non-traditional rewards all can be used as motivation. Whether you decide to use a year-end bonus system, a raise, or some extra vacation time, it’s important to recognize employee work with positive reinforcement if it is deserved.

While large organizations often have a traditional style incentive program, small businesses can participate in a reward system as well. Choosing the right compensation reward system for your organization can be an overwhelming endeavor. The implementation of that mechanism doesn’t have to be. Now start planning! 

Watch a demo of Reviewsnap's compensation dashboard modules to get started.

Don't Miss the First Part of Our Series:

Tuesday, December 30, 2014

How to Grow Part 1: Performance Management in 3… 2…

“Only 6% believe their current process for managing performance is worth the time, 58% called their process ‘weak,’ with North American companies 20% worse than the rest of the world.” - Josh Bersin (@Josh_Bersin), Corporate Talent, HR, and Learning Analyst & Founder of Bersin by Deloitte
Only 6%... that’s a pretty slim number of organizations who have a strong performance management system. So what’s the problem? There’s a good chance these companies joined the performance management party late - as in after their employee base grew. Create a performance management system before you begin to gather your team. It’s important to know how exactly you plan to manage the performance of a team before they are onboarded. Why? Unless there is a performance system in place, it will be increasingly difficult to accurately develop and maintain a system of performance appraisals, management system updates, and team alignment with each new employee.

Problem: Performance Appraisals
Is it really a performance appraisal if it doesn't truly identify performance? The answer is no. In fact, performance appraisals are sometimes wildly erroneous and can lead to more performance problems than they actually solve. For example, two-thirds of employees who receive the highest marks during their performance appraisal are quite frankly not the organization’s top performers. Sounds like an oxymoron, right? The underlying problem is that these performance appraisals are outdated and tend to be overly biased. The results are less than flattering. While good employees know they are good, bad performers on the other hand don’t know how poor their performance is. This is because the performance appraisal system wasn’t created until after the maturation of the team, so a set standard of performance regulations wasn’t immediately put into action.

Solution: Create a performance appraisal plan when you recognize the need for growth in the number of employees. Doing so will prepare the organization for the new hires and monitor their growth and performance.

Problem: Updating Outdated Issues
It's really just a formality. Does it honestly need to be updated? Absolutely. The outdated system your organization currently uses needs to be updated. While the company may have originally compiled some sort of performance system for compliance regulations, that certainly doesn’t mean the data from the performance appraisals couldn’t be useful. The data for how the employee works and what they get done during the day can set expectations of the employee, demands of the position, and expectations of the supervisor. Updating your performance management process not only helps the development of your employees, but drives business value as well. Unfortunately, only 8% of HR executives say that their organization effectively uses their performance process to drive business value. Therein lies the problem with using an outdated system - it can in fact damage the value of your business.

Solution: Consistently update the performance management system to meet the needs of the organization and the employees.

Problem: Team Alignment
The team doesn't know the goals of the organization, so they don't understand how their performance fits into organizational needs. Often, the biggest downfall for employee performance is their lack of understanding of organizational goals. If employees are unaware of how the company plans to grow, how can they gauge their own performance? When employees are aligned with organizational goals, they are more engaged while in the office. When employee engagement is high, employees perform 20% better and are 87% less likely to leave the organization. In order to form a high-performing team, it’s crucial the entire organization understands and shares goals. President and COO of Technomedia, Marcel Messier said:
“If leadership is unable to create a clear roadmap that can be communicated and embraced throughout the organization, it will be much more difficult to establish a high-performing workforce able to meet those goals. Alignment only will be achieved by ensuring strong leaders are in place at the top and capable of clearly communicating goals and expectations and providing employees with ongoing learning opportunities to expand and enhance their skill sets. Once these factors are put into place, the organization can benefit from an optimized workforce that operates cohesively to overcome challenges and achieve key objectives.” 

Solution: Integrate alignment into performance management. When the team knows how their work affects the organization, they are less likely to leave and more likely to become high-performing employees.

Not all performance appraisals were created equal… the outdated and antiquated ratings will do little to improve an employee’s performance. Performance appraisals must recognize accomplishments and notate areas needing improvement. Likewise, if the management systems the organization uses aren’t up-to-date, it’s unlikely the performance management system will do much to drive business value. Ultimately, without alignment throughout the organization there’s little hope for an overarching level of high performance and engagement.

Your company needs these three things before your team can grow. Otherwise, it’ll not only be difficult to manage employee performance, it will be ineffective. 

See how you can begin cultivating growth in your organization right this second.

Wednesday, December 17, 2014

Happy Holidays? Not if You Forget Your Employees

It’s the only time of year that it’s acceptable to give a fruitcake. Complete with hot cocoa, stockings hung with care, and holiday bonuses… wait, what? Yes, these are all trademarks of the holiday season, especially the bonuses. Tis the season to recognize your employees, and failing to do so could mean losing valuable employees. Consider the case of a PR firm that usually gave large year-end bonuses and without warning one year, shifted that spend into opening a nice new office. Or what about the high-end magazine that rewarded executive employees with a large novelty candy? Both companies suffered significant attrition before the New Year. Don’t let this happen to you.

Photo Credit: National Lampoon's Christmas Vacation
Frustration can simmer just under the surface of your workforce, but your organization can reduce some irritation by implementing formal recognition and review programs. Organizations that create and sustain an effective recognition program have a 31% lower voluntary turnover rate - i.e., employees quitting or resigning - than those with a poor recognition program. In fact, lack of appreciation at work is the number one reason Americans leave their jobs, but you can use it as a retention tool.

According to the latest Randstad Engagement Index survey, U.S. workers say promotions or bonuses are one of the most effective ways to keep them engaged in their jobs. A holiday bonus increases employee engagement and motivation in the office, which means more successfully completed projects and subsequently more revenue for the organization.

The truth is, your employees might be dreaming of a white Christmas, but they are expecting recognition before the New Year. Some (like Clark Griswold) may even be counting on that bonus to make their Christmas a merry one.

How and When to Reward

Just because you tell members of your team how wonderful their work is all year doesn’t mean that will suffice when it comes to the holiday season. Unfortunately, not every company feels that way. In fact, just 27% of small businesses are planning to offer holiday bonuses this year, compared to 35% last year, according to an American Express survey. (Tweet this Stat) That special recognition in the workplace is one of the greatest contenders to combating high turnover rates. So, even though it makes your employees happier at work, it is a business gain as well.

Some pointers:

      Try to give consistently. If you can’t for whatever reason, let employees know ahead of time.
      People will talk. You don’t have to give the intern and the top performing sales person the same amount but keep it similar within job titles.
      Speak up! Bonuses and gift cards have to be declared so give your employees a head up!

The ROI of employee recognition stretches beyond a mere monetary value. The emotional response is what fuels a difference in an employee’s work and engagement. For example, KPMG, an international tax and audit organization, increased awards dispersed throughout the company by 25%. The results were, according to Sara Turner, UK Head of Employee Benefits and Wellbeing at KPMG:
“What you get with the recognition is a really emotional response… Though the monetary value is low, the impact is really huge. In monetary terms, recognition is so much less expensive [than other reward systems], but what you get is this emotional gut response from people who are overwhelmed, happy and excited when they get an award. People are so engaged because someone has appreciated the extra effort they’ve gone to and taken the time to make sure they acknowledge it and that others acknowledge it as well.” 

Think Outside the Box

The business landscape has changed over the last few years. Employees are feeling the effects of a slowly healing economy. Unfortunately, employers aren’t so trigger happy when it comes to expenses that aren’t deemed “necessary.” Individuals on your team expect some kind of bonus around the holidays. If business was down, communicate it well and set expectations before the office party if you are planning on giving a non-monetary gift.

On average, there is an expectation of a 2.9% bonus increase among the workforce this year. (Tweet this Stat) Even if you’re not prepared to dispense a monetary reward for all of the meritorious hard work from your team, leadership can still give employees a “bonus.” If budget constraints prevent a traditional bonus, Glen Tullman, CEO at Livongo Health suggests trying these alternatives:

      Give a tangible gift - A gym bag, a nice sweater, or a small piece of technology would suffice. However, don’t put any company logos on the gift… otherwise the gift loses the “it’s the thought that counts” factor. 
      Offer a chance for community involvement - Websites like TisBest allow employers to offer “gift cards” that employees can use towards the charity of their choice. This gives them a semi-monetary reward for their hard work and the opportunity to give back to their community.
      Give to employee families - Why not engage your employees through their support systems? Families are important to the engagement of your team, so try sending a basket of gourmet snacks or giving a list for the family to choose from.
      Give time off! Can’t afford a lavish bonus? Give the gift of paid time off. People love unexpected vacations. (Tweet this Tip)

The holidays can be a stressful time for employees. Finishing year-end projects around the office can be taxing. Acknowledging their work and rewarding them through traditional bonuses or non-traditional gifts maintains engagement levels and produces a real ROI for the organization. Bear in mind that performance bonuses and holiday bonuses should be kept in two separate categories. As company leadership, ensure you’ve dotted your holiday I’s and crossed your T’s; make employee recognition part of your holiday to-do list this year. Give your team a little something special (hopefully more than just a holiday fruitcake).

Friends don't let friends be the Frank Shirleys of their company. Spread the holiday cheer by tweeting these year-end bonus tips.

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Reviewsnap Headquarters Reviewsnap is headquartered in Des Moines, Iowa, and is a division of Applied Training Systems Inc., founded in 1995.