Organizations are increasingly seeking to automate and enhance their performance review programs and processes. As a result, HR professionals are on the lookout for software solutions that can assist them in this endeavor. They are in search of superior options that also reduce the administrative burden of managing performance (along with the annual review process) across an organization.
Traditionally, software in this domain was based on digitizing the paper-based workflows that were part of the annual performance review. These digital workflows were often integrated with a Human Capital Management (HCM) platform or a Human Resources Information System (HRIS), or they were offered through dedicated HR performance review software.
In the past five years, HR technology platforms have broadened their offerings by developing a comprehensive suite of tools, known as performance management platforms. These tools go beyond merely facilitating the coordination of annual performance reviews. They also emphasize communication enhancements, feedback gathering, and goal tracking, thereby attempting to provide a more robust approach to performance management.
Starting Point: Know Your Performance Software Vocabulary
When selecting the appropriate software solution for your organization, begin by assessing the different strategies that software vendors employ to address the inherent challenges of performance management. Additionally, it’s important to recognize that each vendor may use unique terminology to describe their offerings.
Here is a simple chart to help you understand the key differences in approaches and terminology:
| Label: | Definition: | Similar or Overlapping Terms: |
| Performance Management Software | Performance management software is designed to help organizations manage employee performance. It enables managers to set goals and objectives, track progress, and provide feedback. The software often includes features for feedback distribution, data collection, administrative task management, performance analysis, and secure feedback. | Performance Review Software, Employee Engagement Software Platforms |
| Performance Review Software | Performance review software is a subset of performance management software and is primarily focused on improving and simplifying the task of helping leaders evaluate an employee’s performance. Since this type of software is more targeted, it is often less expensive than full performance management software suites. | Employee Evaluation Software, Performance Appraisal Software |
| Performance Reviews | A performance review is a formal assessment where an employee’s job performance is evaluated in terms of quality, quantity, cost, and time, typically by the corresponding manager. It is an opportunity for managers and employees to engage in meaningful conversations about performance, set goals, and identify areas for improvement. | Performance Evaluation, Performance Appraisal, Employee Evaluation |
| 360-Degree Feedback | 360-degree feedback is a process that provides a complete picture of an employee’s performance by gathering feedback from all angles. This includes peers, supervisors, direct reports, and other individuals whose relationships are key to the participant’s success. It’s designed to offer a safe environment for participants to receive candid, confidential feedback, which can help identify strengths, weaknesses, and blind spots in working relationships. | Multi-Rater Feedback, Peer Feedback, Peer Review |
| Continuous Feedback | Continuous feedback refers to the ongoing process of providing real-time feedback to employees rather than waiting for scheduled performance reviews. Continuous feedback can be facilitated through various tools and methods, such as one-on-one meetings, performance management software, or informal conversations. | Ongoing Feedback, Ongoing Conversations, Frequent One-on-One Conversations |
| Goal Tracking | Goal tracking is a process within performance management that involves monitoring and measuring an employee’s progress against agreed-upon objectives. It typically includes setting and updating goals, tracking achievements, and analyzing performance data. Performance management platforms often include features for goal tracking, allowing managers to set goals and objectives, track progress, and provide feedback. | Goal Progression, Performance Tracking
Lately, Goal Tracking has become synonymous with the idea of Performance Management. |
| Employee Engagement | Employee engagement is the extent to which employees feel passionate about their jobs, are committed to the organization, and put discretionary effort into their work. Employee engagement is not just about employee satisfaction or happiness; it’s about being emotionally invested in and focused on creating value for the organization. | Employee Satisfaction, Culture |
| Goal-Based Organization | A goal-based organization is one that focuses on setting specific, measurable, achievable, relevant, and time-bound (SMART) goals for its employees and teams. These goals are aligned with the organization’s strategic objectives and are used to guide employees’ work and measure their performance. In a goal-based organization, success is defined by the ability to meet or exceed these set goals, and performance management systems are often in place to track progress and provide feedback. | Goal-Oriented Organization |
| Competency-Based Organization | A competency-based organization is one that focuses on the development and utilization of specific competencies, which are the skills, knowledge, behaviors, personal characteristics, and motivations associated with success in a job. They define the collective capabilities that enable an organization to deliver value, compete in the market, and adapt to changes. Competencies are used as a framework to align the strategic objectives of the organization with its leader and employee development efforts. | Skills-Based Organization |
| Employee Recognition | Employee recognition is the acknowledgment and appreciation of an employee’s work, contributions, and achievements within an organization. It is an important aspect of workplace culture that can boost morale, increase engagement, and encourage high performance. | Recognition and Rewards, Employee Motivation, Employee Satisfaction |
| Intrinsic Motivation/Extrinsic Motivation | Intrinsic motivation for employees refers to the internal factors that influence behavior and are inherent to an individual’s personality. It includes elements such as job fit, value alignment, and a sense of belonging. Intrinsic motivation is contrasted with extrinsic motivation, which involves external rewards or pressures to drive behaviors or activities | Intrinsic Motivators are:
Meaning, Autonomy, Growth, Impact, and Connection |
Software Design Philosophy: Two Basic Frameworks
Performance management software typically adopts one of two fundamental approaches. It is either designed with a primary emphasis on goal setting, tracking, and progression, or it is crafted to facilitate feedback and evaluation, with goal-tracking as a secondary function. Each approach has its advantages and disadvantages, but it is rare for a software tool to excel equally in both areas. The key is to select the approach that aligns best with your organization’s needs and objectives.
Software that concentrates on goal tracking is structured to monitor and measure an employee’s progress against established objectives. It usually includes features for setting and updating goals, tracking achievements, and analyzing performance data. This type of software is quantitative, offering a clear and structured method for performance assessment. It is particularly well-suited for organizations that have a goal-oriented culture and focus.
Conversely, performance review software that prioritizes facilitating conversations is more qualitative. It aims to foster a dialogue between a manager and their direct report, centering on feedback, coaching, and personal development. This software often comes with tools for scheduling reviews, guiding discussion topics, and documenting conversations. The focus here is on the quality of the interaction rather than solely on metrics. For a competency-based organization, an emphasis on feedback within performance management would be advantageous.
OPTION #1
OPTION #2
What Drives Change in Your Organization?
What truly drives an individual’s growth and development as an employee or leader? Many HR professionals and organizations believe that setting and tracking meaningful goals is the key to improving behavior and skills in the workplace. Goals provide a structured framework that directs an individual’s efforts toward a desired outcome, and most performance management software platforms are built on this principle.
However, the question arises: does goal-setting alone actually lead to behavioral change? Or is it the subtle shifts in perspective—those that redefine our outlook on life and work—that inspire us to make meaningful and lasting changes? While goals offer a concrete target, it is the perspectives that shape our worldview. Altering one’s mindset, beliefs, and interpretations of situations can lead to a profound transformation, resulting in a series of behavioral changes.
This understanding is the foundation upon which DecisionWise’s software tools are designed. Our tools are crafted to encourage feedback, provide key insights, and facilitate meaningful conversations, all of which are essential for fostering genuine development and growth.
Other Considerations
Another challenge to consider when evaluating performance management software is that the term “Performance Management” may have different meanings depending on the context. This can be a lot like the term “Employee Engagement.” When we talk about employee engagement at DecisionWise, we are talking about an employee mindset where employees are committed to their work and bring discretionary effort. Other use cases refer to employee engagement as tools or programs designed to “engage” employees in specific activities. For example, offering them interesting programs such as wellness challenges or employee get-togethers.
The same is true with performance management. A product focused on recognizing employees for their efforts may call itself a performance management tool but is more about facilitating recognition and less about the process of developing employees on a holistic level. Thus, in evaluating platforms, you need to consider if the software is for one specific use case, but calls itself a performance management tool, or is it a more robust tool designed for a broader spectrum of use cases.
Our Performance Software Recommendations
In summary, DecisionWise stands out with its distinctive value proposition. We have crafted an employee experience platform that empowers leaders to design and manage the employee experience at various organizational levels. This includes tools that aid in monitoring employee performance.
Our performance solutions are primarily centered on feedback and fostering high-quality conversations. We also place a significant emphasis on collecting feedback from diverse sources to ensure that employee evaluations are as objective and fair as possible. Our ultimate goal is to provide meaningful feedback that facilitates impactful and enduring conversations between managers and employees. This approach is designed to not only evaluate performance but also to enhance the overall employee experience within the organization.
We offer:
- A focus on gathering feedback with the right mix of quality vs quantity.
- A focus on using 360-degree feedback to improve performance reviews.
- A focus on creating meaningful reports that offer insights that drive lasting change and progression.
- A focus on empowering managers and leaders to engage in better conversations and to become stronger coaches and mentors.
- A focus on simplicity in providing high value for the required effort and price.
Please contact us to learn more about how our performance management tools might be the right fit for your organization.
