Performance management improves performance when it is treated as a continuous cycle—not a once-a-year appraisal. Set expectations that connect people’s work to organizational goals, choose objectives suited to the work, provide support and useful feedback, then review progress and adjust. A formal review can be part of that cycle, but it cannot replace the day-to-day management that makes the cycle work.
What performance management includes
CIPD defines performance management as the practices organizations use to maintain and improve employee performance in line with organizational goals. The cycle connects individual and team objectives to strategy, supports progress, provides feedback and development, and establishes accountability. That accountability may inform reward, progression, or employment decisions.
As CIPD puts it, “Performance management should be a continuous cycle, not an isolated event.” Its 29 January 2026 factsheet also cautions that there is no single best approach: an overarching framework can help integrate the different management activities, while everyday conversations remain central.
This distinction matters because an annual review is a meeting, not a complete performance-management system. A review can help people reflect, recognize achievement, and agree next steps. It is much less useful if expectations have been unclear or progress has gone unaddressed for months.
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Start by defining what good performance means
Before setting targets or choosing a scorecard, identify the outcomes, skills, and behaviors that matter for the role and the organization. A useful framework makes those expectations understandable to employees and managers, without assuming every job can be judged by the same measures.
- Connect the role to organizational goals. Explain how the employee’s work contributes to a wider objective.
- Clarify the expected contribution. Specify the outcomes, responsibilities, or behaviors that are relevant to the role.
- Consider the level of work. Decide whether success depends mainly on individual contribution, team results, or both.
- Check that expectations are within the employee’s influence. A target tied to factors they cannot reasonably control may obscure rather than clarify performance.
Roles often combine predictable tasks with complex, collaborative work. It can therefore make sense for one employee to have different types of objectives rather than a single uniform target.
Choose goals that fit the work
Specific, challenging outcome goals can focus effort on relatively straightforward work. But complex work—where people must interpret new information, learn skills, or coordinate interdependent steps—may need learning goals, behavioral objectives, or more open-ended outcomes instead. “Always use SMART goals” is too blunt: specificity helps in some contexts, while premature precision can narrow attention when the route to a good result is uncertain.
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| Work context | Goal approach to consider | What to pay attention to |
|---|---|---|
| Relatively straightforward, predictable tasks | Specific, challenging outcome goals | Make the expected result clear and ensure the measure reflects the work. |
| Complex work, skill acquisition, or uncertainty | Learning-focused goals, behavioral objectives, or open-ended outcomes | Track learning and progress without pretending every step or result is predictable in advance. |
| Interdependent or collaborative work | A deliberate combination of individual and team objectives | Recognize shared contribution while keeping individual responsibilities clear. |
These are choices to make in context, not fixed categories. The same role may include work from more than one row, and its objectives can reflect that mix.
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Feedback is useful when it gives people information they can act on: whether they are progressing toward an agreed goal, what is working, and what may need to change. It should be timely and focused on improvement, not delivered more often simply for the sake of frequency. CIPD’s 2022 evidence review notes that feedback can harm performance when handled badly.
- Agree the goal first. Feedback is easier to interpret when employees know what they are trying to achieve or learn.
- Discuss evidence and next steps. Make the conversation specific enough to support action, rather than relying on vague praise or criticism.
- Help employees track progress. Use progress checks to identify obstacles and adjust support before a formal review.
- Build manager capability. Feedback requires judgment and care; an instruction to “give more feedback” is not a substitute for helping managers do it well.
The right rhythm depends on the work and the purpose of the conversation. The cited evidence supports ongoing progress conversations, but does not establish one ideal cadence for every organization or role.
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Use formal reviews for a clear purpose
Appraisals can contribute to performance, but they do not reliably do so in every setting. Employees’ reactions matter—especially whether they see the judgment as fair and useful. Set expectations for the review and explain how its conclusions will be used before the meeting begins.
Development discussions ask how an employee can improve, learn, or progress. Administrative discussions inform decisions such as reward or promotion. Those purposes can call for different judgments, so CIPD recommends keeping them separate as far as practicable. If the organization must combine them, say so clearly and explain how the process will handle both.
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1Fix the driver behind crashes, sound loss and screen glitches2Clear out junk files and repair common Windows errors3Scan for outdated or missing drivers - takes under a minuteA review conversation can help a manager and employee reflect on progress, recognize contributions, identify barriers, and agree goals or support for the next period. It should draw on information gathered during the cycle rather than introduce important concerns for the first time.
Measure performance without reducing it to one number
Measures should reflect what matters in the job. A simple output count may be useful for some tasks, but it cannot capture every dimension of performance. Professional and knowledge work can be harder to measure; subjective judgment may help, but the measures and judgments still need scrutiny.
- Relevance: Does the indicator capture an important part of this role’s contribution?
- Validity: Does it measure what the organization intends to assess?
- Reliability: Is it applied consistently, rather than changing with the evaluator or occasion?
- Fairness: Are employees assessed against expectations and evidence appropriate to their roles?
- Unintended effects: Could the measure encourage people to optimize a count at the expense of quality, collaboration, or the real objective?
When work depends on collaboration, include team contribution in goals and measures where it is relevant. Keep individual accountability clear as well; a team result alone may not explain each person’s responsibilities or contribution.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.What the UK survey figures do—and do not—show
CIPD’s reporting on its 2023 UK Working Lives survey found that 28% of surveyed UK employees reported experiencing “systematic performance management”—a combination of setting objectives, monitoring them, providing feedback on achievement, and requiring accountability for missed objectives. Among employees reporting systematic management, 89% agreed, “I achieve the objectives of the job, fulfil all requirements,” compared with 76% of employees reporting no performance management.
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These are self-reported survey results showing an association, not proof that performance management caused the difference. They describe surveyed UK employees, not every workforce, job type, or country.
Put the cycle into practice
- Align: Connect role expectations to organizational priorities and identify relevant outcomes, skills, and behaviors.
- Agree goals: Choose outcome, learning, behavioral, or open-ended objectives to suit the work; include team goals when contribution is shared.
- Support: Make sure employees have the guidance and conditions needed to make progress.
- Check progress: Hold useful conversations, review evidence, and address barriers during normal work.
- Review: Use a structured discussion for reflection and next steps, and state whether it is developmental, administrative, or both.
- Learn and adjust: Consider whether the goals, measures, feedback, and process helped people contribute, then refine the approach.
The framework should make those steps coherent, not turn them into paperwork for its own sake. Adapt it to the nature of the work and the decisions the organization needs to make.
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