How can Online Performance Management help you with your business?
Table of Contents
Business optimization is the best way to increase competitiveness. All other methods (savings, development, etc.) have their drawbacks, but drawing more from existing resources is obviously the most effective approach you can have. Thus, without large investments, you can significantly increase your overall productivity and improve your position, and at the same time, that investment will be ten times worthwhile.
A fairer distribution of salaries, better management of material and human resources, more efficient rewarding, but above all qualitative improvement of skills that are important for employees to perform their work efficiently, help the entire organization to achieve the goals set by management.
Data collection and processing are only the first steps in successfully running a business. It is necessary to analyze the data, look at the situation, predict what will happen next, and react adequately. This is the basis of a performance management system. Every company that wants to develop or beat the competition, must properly manage its resources. That is why the next big step in the development of any company is online systematic performance management.
What is Online Performance Management?
Online performance management is an ongoing process that consists of planning and setting company goals, measuring, assessing progress, and obtaining feedback to ensure goals are achieved or measures taken to improve and enhance by using software instead of a traditional way.
As such, this process represents one of the most important management tasks that interfere with almost every moment of a manager’s working hours. If properly implemented, the performance management process over time becomes part of the day-to-day work practices of all employees, not just the annual bureaucratic task imposed by HR and superiors.
It is necessary to measure the performance of those processes on which the fulfillment of the goals and requirements of the interested parties largely depends. It is necessary to ensure repeatability of measurements and thus monitoring and comparison by years. This makes it possible to better understand the trends and see both the risks and the chances for improvement and the adoption of corrective measures.
The purpose of the online performance management process is to constantly review the company and take appropriate steps to constantly increase the company’s performance.
How does Online Performance Management System work?
There are few steps you need to take:
- Prepare a plan
- Make sure you know what your business needs
- Define the requirements
- Choose a software
- Launch the software and test your system
The controller must make sure that the results of business performance measurements are presented simply so that everyone in the organization can easily read and understand them. It is necessary to include almost all employees in the measurement process, because in that way, on the one hand, the process of self-control is strengthened, and on the other hand, all employees are included in the control over the company, its division, organizational unit, etc.
The controller compares the obtained data with a predefined goal and presents the results. Based on the presented reports on which the achieved performance values are compared with the desired values, the manager can make conclusions about the process he manages, ask the cause, and take appropriate measures in the next step to achieve the set goals in the future, or ultimately re-examined the goals themselves.
The last step in the performance measurement process is to make a decision regarding the achieved performance of the process and the organization. Management has two most important decisions at its disposal: maintenance and improvement.
Maintenance refers to activities aimed at maintaining existing technological, managerial, and operational standards (objectives), while improvement refers to activities aimed at improving existing standards (objectives).
Without taking measures, in case the achieved performance values are in accordance with the goal;
Taking corrective measures, in the case when the achieved performance values are below the desired ones and when it is determined that the cause of the discrepancy is in the way the process takes place.
When it comes to corrective measures, we apply three cases:
- Goal change – In the case when the achieved values are above or below the desired ones and when it is determined that the cause of the non-compliance is incorrectly set goal;
- Modification of the indicator being measured – Reengineering the performance measurement process;
- Changing the threshold for achieving the indicator – For example, if the expected margin increases at the strategic level of the organization, it must change at the level of individual indicators in the sales process and the like – thus maintaining the link to the strategic goals of the company;
How businesses can benefit from online management?
Reporting on the performance of an enterprise organization is aimed at providing information to the stakeholders of the enterprise on all key aspects of performance. Reporting provides a complete picture of capital owners, managers, and employees on the performance achieved, an analysis of deviations from set standards or target performance, as well as an analysis of the factors that caused this deviation. Based on the presented flows and state of business in the past and present, the performance report enables an insight into the future. Thanks to the given information, managers try to reduce the uncertainty of their business in the future and to take appropriate actions that can influence changes in the company and the environment or adapt to them, which can transform the dangers into their own chances of success.
Online performance management has become the key to organizational capacity for growth and progress and is an integral part of it. By managing the performance of business processes that occupy a central place in the existence of an organization, it manages the business of the organization.
Regarding the future of an organization, there are two important factors: its vision and ability to manage change. If either of these two factors is left out, the organization is either inefficient or ineffective, and it definitely loses the market race. In order to effectively manage performance, it is necessary to implement a management model and have the appropriate software support.
The performance measurement system helps us because it:
- enables management to define business priorities,
- strengthens the responsibility of management,
- eliminates subjectivism in management decisions, and
- strengthens the responsibility of employees to be as effective and dedicated as possible in the performance of their tasks.
7 Benefits of Online Performance Management
As a rule, system improvements of business organizations are best implemented through systems for improvement and performance management. Through them, you can not only see realistically where you are now but also clearly understand what opportunities you have and see how you will achieve the goals you are striving for. Here are 7 benefits of online management and why it is better than the traditional way:
More crucial information
Since human and other intellectual resources are a key determinant of a company’s success in a modern environment, there is a problem of accurate and reliable financial valuation and inclusion of these resources through the balance sheet. Financial metrics predominate or are exclusively present in most companies’ business performance reports. Therefore, business reports dominated by intellectual resources should be supplemented with information on non-financial performance measures, as existing traditional financial statements are largely outdated and insufficient.
A complex business environment requires a multidimensional approach to measurement. Of course, the financial dimension is primary, but it certainly cannot be the only relevant one. Therefore, a balance is needed between the different dimensions of performance measurement (financial and non-financial measures, long-term and short-term; successful use of tangible and intangible resources, satisfaction, and contributions of different stakeholders). Recently, an increasing number of companies are paying attention to non-financial performance.
It is about measuring the effects of corporate social responsibility, consumer loyalty, employee satisfaction, and other indicators that are not of a financial nature but have a significant impact on overall business success. Non-financial segments have significant benefits for the management and other stakeholders of the company. Through non-financial performances, the area of “intangible values” is usually reflected, such as, among other investments in employee training, investments in the brand of products, and others.
The short-term dimension of financial measures means that they do not provide adequate and complete assessment strategy performance. Given that these criteria reflect certain results of past activities, information of this kind may lead to actions that are inconsistent with strategic objectives.
Less workload for managers
CEB‘s study showed that managers are wasting time by spending about 5 weeks measuring management performance. With good software, you can say goodbye to scheduling meetings with every single employee, especially when they are in different time zones.
The online performance management system allows you to review employees whenever you want. This is really important because you can make a larger picture of how is your employee doing, and what he needs to be more productive.
Motivation for the employees
A good motivation is key when it comes to good employee performance. When they have goals, people are much more motivated and thus increase the will and desire to do the job as well as possible. The right software will allow employees to always have clearly defined goals and thus progress, pushing the company to a whole new level. This goal can’t be forgotten since they will always be displayed and employees can always view them.
Online is better
Most people are used to many things being online now. More and more people are spending time at home, more and more people are working from home, the internet is being used more and more. For newer generations, it is even inconceivable that the traditional way is still applied given that the life of Generation Y, or as they are called in Anglo-Saxon literature – Why Generation, Millennials, iGeneration, eGeneration, revolves around the Internet.
If we take into account the existing pandemic, then this approach is perfect because the health of employees and managers is not endangered. Precisely because of the situation that became alarming, people were forced to work more and more from home, which led to the digitalization and flourishing of work from home.
Better data accuracy
No one is perfect, so it happens that managers make mistakes when manually recording the collected data. With online performance management, you no longer have to worry about this because the tool will process and display the data exactly as it is. This will allow managers to see clearly what they need to do to better motivate employees, or provide them with some additional training.
Another thing that sometimes happens is that someone is biased. The software does not know about this term, so the results will always be real-time and realistic, which is why you will not have a problem that the employee continues to do a bad job just because the manager is his friend.
Accessible from anywhere
Whether you are in the office or at home, you will always be able to access the online performance system at any time of the day. All you need is your device (mobile, PC, or laptop) and internet connection. The procedure is also simple – just log in to the application of your chosen software and see all the necessary information.
What are the concerns with implementing a performance management system online?
Investing in a good online performance management system is one of the most profitable investments measured in tens of times, but of course, provided that the system is designed professionally, carefully, and adapted to the company in which it is introduced.
The development and introduction of such systems, as a rule, take several years, but their benefits can be seen from the moment of introduction, and over time it becomes more important and makes a constant profit. However, poorly implemented software will only make you lose your precious time and money.
Competencies for implementing online performance management processes are often underestimated or overlooked, and managers need to be able to set clear, measurable, and achievable goals, to be able to define and assess the profile of employee competencies, to be skilled in how to collect and provide useful feedback information.
How stayhome.ai can help?
The purpose of this continuous process is both to improve employee performance and the performance of the organization. This management approach is of key interest to both small and large organizations – for-profit and non-profit, manufacturing and service in the private and public sectors, for all industries – domestic and global.
As we mentioned, good software selection and implementation are key if you want your performance system to work. stayhome.ai will meet your expectations and help you make your performance system perfect.
Managers at all levels are under constant and growing pressure to improve efficiency and effectiveness in their sphere of action and responsibility and this is precisely the tool that can be essential to them. If performance is something that people do and can be observed, performance management would be the systematic and continuous identification, measurement, development, and alignment of performance with set goals or expectations.
Not so long ago, the introduction of performance management in a company was a complex and time-consuming process as all data was collected manually. The reports and with them the indicators were calculated once a year and the management was able to see all the indicators for the previous year and that is the only thing it could do. Without any possibilities for timely corrective measures.
By using modern ERP and BI as a reporting tool, the entire process of data collection and further analysis has been significantly simplified, so today they are the most loyal allies of our controller. Management, as well as employees who are increasingly involved in the performance management process, can access most of the desired information at any time, which certainly contributes to more efficient and better management of the company.
Regardless of the size of your organization, employee performance management is key to motivating, retaining, and further developing employees. It is very important that each organization implements a model of online performance management and employee development tailored to its own business.