By the year 2030, Millennials will comprise roughly 75 percent of the workforce. To understand what they want from an effective performance management system, it is essential that we get to know them on a fundamental level: what they aspire to, what they prioritize, how they think, and how they are motivated. This ultimately will have a massive impact on engagement, retention, and recruitment.
What is important to understand is that Millennials are generally well-educated, confident, and adept with technology. They prefer flat management structures. They are skilled multi-taskers, and flexibility is a significant motivator in respect to their work life. By using this knowledge, as well as existing studies, we can deduce exactly what Millennials are looking for from their performance management systems and from their organizations in general.
Regular and Effective Communication
Millennials have grown up in an age of real-time feedback. Advice and opinions are solicited and readily given in their private lives, and this is equally expected regarding their professional lives. This is great news, as such frequent communication ensures that colleagues remain knowledgeable about current issues, changes, and successes within the company. Providing open channels for communication both horizontally and vertically results in a more engaged and motivated workforce. Modern performance management software incorporates this need for constant communication by providing a social media-like platform that permits instant feedback between coworkers.
Frequent, Quality Feedback, Rather Than Ratings
Millennials seek regular feedback from their managers. Annual reviews are no longer sufficient. This move toward continuous performance management keeps the lines of communication between employee and manager open, allows for the exchange of ideas and information, and provides opportunity for reward and recognition. Importantly, it also gives managers a chance to immediately address behavioral issues.
With regards to feedback, Millennials want precise, helpful information detailing what they are doing right, what they are doing wrong, and how they can improve. This is the only way they can excel at their jobs. There should be no room for misunderstanding, and each employee should have a clear idea of his or her set goals and objectives.
Millennials prefer qualitative feedback, rather than quantitative feedback. Numerical ratings, made famous by companies such as General Electric (GE), are not appealing to this new dynamic generation. In fact, even GE has overhauled its performance management system and removed performance ratings. GE’s head of HR, Susan Peters, confirmed that these moves were in part due to the way in which Millennials react to feedback. She reiterated their need for feedback to be frequent, fast, and mobile-enabled.
A Flexible Working Environment
The average Millennial isn’t scared to leave his or her job when unsatisfied with company processes or prospects. According to Forbes, job hopping is the new normal, so if a company wants to retain quality employees, efforts must be made to increase flexibility.
It has been shown that most Millennials are happy to change careers, sacrifice promotions, or relocate to a new area in exchange for a job with heightened flexibility. This flexibility can come in the form of flex-time or telecommuting. This will demonstrate trust for the employee, and it also will cultivate a healthy company reputation regarding work/life balance. As long as the work is being done on time and to standard, it might be worth experimenting with. Large organizations such as Evernote and Virgin have even gone so far as introducing an “unlimited vacation.”
A Boss Who Guides, Rather Than Instructs
Millennials are generally independent in spirit. A study reflects that 72 percent of Millennials want to work for themselves, indicating that they prioritize autonomy, creativity, and flexibility. For those who work for others, they have expressed a wish that their boss act as more of a “coach” than a traditional manager. This can easily be incorporated into the average performance management system. Rather than tracking employee movements every step of the way, employees could be given a certain degree of leeway to accomplish their goals by their own means. Ultimately, you will be rewarded with a workforce with increased critical thinking skills and an ability to tackle complex situations.
Recognition for Their Efforts and Achievements
Over the years, it has been shown that employees are more motivated by recognition than money. It is human nature to want acknowledgement for our efforts and accomplishments. Millennials are no exception. In fact, they want to be recognized and rewarded at least once per month. This isn’t much to ask, and given that we will be engaging in more regular catch-ups with our employees, we will have more opportunity to discuss recent successes.
Opportunities for Advancement
Millennials are determined. They want to know their company will provide them with opportunity. If this is not something your performance management process is prioritizing, it will cost you talented candidates. As reflected by Deloitte’s Millennial Survey 2015, more than 53 percent of Millennials have high ambitions of being the leader of their current company. A PwC report also reflected that 52 percent of Millennials named opportunity for upward mobility as the main attraction when it came to job selection. When we add to this the fact that a Harvard Business Review study showed a lack of career development support to be the primary reason for the loss of high-performing employees, it is obvious that clear routes of progression are paramount.
To prevent your employees from growing disillusioned with their job and disengaged with your company, set time aside to discuss their potential within your organization, how they might advance, and likely time frames. Performance management tools can be utilized to create these plans and track employee progress.
If we have learned anything recently from the actions of leading conglomerates, it is that every performance management process should be fluid and adaptable. To guarantee success, an organization must roll with generational changes. Change is never simple or instant, but gradually working toward a working environment that makes the most out of your employees’ strengths is the best way to excel in the long term.
Stuart Hearn has 20 years of experience in the HR sector. He co-founded plusHR, a leading UK HR consultancy, and previously worked as international HR director for Sony Music Publishing. Hearn is currently CEO of Clear Review, an innovative performance management software system.
