Performance standards refer to the defined set of expectations and benchmarks that outline the desired level of performance and productivity for an employee in a particular role. These standards typically include specific targets, goals, and metrics that should be met within a given time frame. They tell us what "good" looks like in a job or set of jobs by defining the "What" and the "How" of job performance. This helps us to focus on the "Who" that we are looking for to fill those jobs.
I am amazed at how few organizations and positions have performance standards despite the critical benefits they provide, including:
1. Clarity: At a basic level performance standards provide clear expectations to employees regarding what is expected of them in terms of performance. This clarity helps employees understand what they need to achieve, and the quality of work they should deliver.
2. Alignment: Performance standards also help align individual goals and objectives with the overall organizational goals. Organizations are systems - think of them like a car. You can drive a car that's out of alignment, but you will wear out the tires and parts, sacrifice gas mileage, and arrive exhausted from fighting to keep it out of the ditch. In organizations without alignment different people are sincerely pursuing different objectives which are often at odds with each other. This internal friction saps performance and potential. Specifying performance expectations that align to broader organizational goals reduces friction and provides a line of sight for employees to understand how their work contributes to the success of the organization. It gives them purpose.
3. Evaluation: One of the greatest benefits of performance standards shows up as manager effectiveness. They provide a manager with an objective scorecard for evaluating employee performance and provide a basis for performance feedback, promoting fairness and consistency in the review process - even across different managers. Employees routinely challenge managers about why they aren't being promoted or why they are receiving a "Needs Improvement" versus "Exceeds Expectations." If a manager can't specifically show employees where they are not hitting a standard, it feels personal. Employees rightly get upset, because they don't know how to improve and managers start to avoid or fear these interactions. But if the manager can say, for example, "we agreed you would close 20 tickets per day but you are only closing 15," that's feedback we can work with that is objective and actionable - not personal at all. We can identify the cause of the deficiency and correct it. Willing employees then truly develop skills and managers develop confidence to get improved results and demand accountability. In the words of my late business partner and mentor, Dr. Harold (Hal) Resnick, "what gets inspected gets respected."
4. Development: Establishing performance standards provides reliable data of actual, real performance against a common standard, and provides a basis for identifying areas of improvement and addressing any performance gaps. In companies where many employees hold the same job across different managers, this enables organizations to review performance evaluation data of the entire population to target and prioritize training for the highest needed skills rather than applying broad training and hoping it improves results. It also provides employees a career path roadmap for growth. Motivated employees are encouraged to continuously develop the right skills, knowledge, and abilities to meet or exceed those standards. This promotes a performance-oriented culture of learning and growth within the organization.
Performance standards are important because they provide clarity, align individual and organizational goals, enable evaluation and development, promote accountability, and foster motivation among employees. It seems almost obvious but very few organizations I work with have actual standards or scorecards, and it's often the first place we start to build the foundation for everything else.