The Essentials of Performance Management

Next to hiring the right team, there is probably no concept more important for a manager to master than the essentials of “performance management.”

Earlier in my career, I used to think the words “performance management” simply meant the annual performance review.

Later, when I became a public sector supervisor, I came to appreciate that performance management is a huge responsibility – not just assigning work, checking in with the team, and making sure things moved along, but also providing valuable feedback.

When I first became a supervisor, I instinctively felt that I should treat everyone the way I would like to be treated. 

Beyond that, I quickly learned another important lesson about motivation: not everyone is motivated by the same things.

For managers seeking advice on this critical topic, the Harvard Business Essentials book Performance Management[1] helps explain what motivates people. This book is so well respected, it has been used as a textbook by the University of California as part of its Human Resource Management Certificate programs.

Each book in the Harvard Business Essentials series is written by Richard Luecke and features a different subject matter expert, in this case Professor Brian Hall of the Harvard Business School.

Extrinsic vs. Intrinsic Rewards

There are essentially two categories that employee motivation falls into:

• Extrinsic rewards
• Intrinsic rewards

Extrinsic rewards are more tangible, visible, and obvious for motivating employees: a promotion or title change, or a pay increase or bonus in recognition of one’s work.

Intrinsic rewards are more ambiguous but none-the-less important for motivating employees: providing a sense of accomplishment, autonomy over one’s work, and a sense that one’s work is appreciated.

Why are these concepts important for a manager to understand? Because, once again, it highlights a significant difference between private sector and public sector management. 

In the private sector, one could argue, Extrinsic rewards are much more common – and having these tools at one’s disposal could give the private sector manager a big advantage over the public sector manager with motivating employees.

But let’s flip the coin over. Does this have to be true?

Many people who have studied motivation in the workplace have concluded that as long as people feel they are compensated fairly, Intrinsic rewards are actually much more important motivators.

So this gives the public sector manager a challenge and an opportunity: if Extrinsic rewards are not an option, then this frees the public sector manager to focus almost exclusively on things that have proven to be more effective: Intrinsic rewards.

The authors of Performance Management list several Intrinsic rewards that managers can focus on:

Make Jobs More Complete

Ask your staff to work on a project, and give them broad authority to produce a new product or service.

Introduce Challenge

Ask your staff to do something outside of their normal work routine: research a policy or law, identify a business process improvement, or respond to a constituent request.

Encourage Them to Become Experts

Ask your staff to become an expert in a policy area or subject that provides your unit and organization with added value.

Drive Out Fear

Tell your staff it’s OK to fail, admit something didn’t work out as planned, and learn from that experience.

Empower, Don’t Micromanage

Focus on results and general principles, and less on this-is-how-you-should-do-something.

Coaching

A discussion of performance management isn’t complete without talking about coaching. Essentially, coaching is the regular feedback that improves performance. The authors have broken it down into a four-step process:

1. Observation – in which the manager identifies a performance gap or an opportunity to improve
2. Discussion or agreement
3. Active coaching
4. Follow-up

Again, the authors provide some advice for managers when speaking with employees:

• Focus on improving performance
• Keep the focus of feedback on the future
• Provide timely feedback
• Focus on behavior, not character, attitudes, or personality
• Be specific

And here’s the final point the authors make: feedback is a two-way street. Be prepared to receive feedback. This isn’t just an opportunity for the employee to learn and grow; it’s an opportunity for the manager to learn and grow as well.

Along with Hiring and Keeping the Best People, mastering Performance Management is truly an essential skill for any manager. The next book in the Harvard Business Essential series that I will discuss, Decision Making, includes even more great advice for managers.

Additional Resources

For managers looking for additional training on coaching employees, UC Davis offers convenient training on the Coursera platform:

Coaching Skills for Managers

[1] About fifteen years ago, Harvard Business School Press started publishing a series of books called the “Harvard Business Essentials.” I’ll spend the next few weeks discussing several of these books and how the concepts can be applied to improve government services.