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McKinsey Talks Talent

What works—and doesn’t—in performance management

Nov 19, 2024
Dive into new research that reveals what truly motivates employees and where organizations often go wrong in performance management. Discover the essential role of clear goals and continuous feedback, alongside the transformative potential of generative AI. Explore strategies for supporting underperformers and the significant impact of financial and non-financial rewards. Address crucial gender biases that hinder women's career advancement, and learn how clarity and collaboration can rejuvenate outdated performance systems.
21:22

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Quick takeaways

  • Clarity in performance expectations is essential, as complex metrics can hinder employees' understanding of their performance and accountability.
  • Effective performance management relies heavily on skilled managers who foster continuous feedback and focus on employee growth rather than just error correction.

Deep dives

The Importance of Clarity and Simplicity in Performance Management

Clarity and simplicity are crucial for driving strong employee performance. Employees need clear expectations to feel a sense of accountability and fairness regarding their evaluations. Complex performance management systems, which often overload employees with numerous metrics, are counterproductive, as they obscure what really matters in performance assessment. Organizations should focus on a few critical factors and clear measures to support employees’ understanding of their performance and progress.

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