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#career#remote work#competencies#levels




THE FUTURE OF EMPLOYEE PERFORMANCE MANAGEMENT: 5 WAYS TO MODERNIZE CAREER
PROGRESSION

by
Pando
October 9, 2023

As we prepare for the final quarter of 2023 (annual review season!) and
strategize for 2024, it’s time to once again look at how we’re managing employee
performance. 

After all, the “old way” of employee performance management is not working,
e.g., traditional annual reviews, lack of transparency into job levels or salary
bands, inconsistent feedback from peers and/or managers, etc. Not only does the
old way lead to more bias in the review process and increased pay disparity, but
it also leads to frustration, lack of career growth, and, ultimately, increased
turnover. 

And as we know, turnover costs US businesses over 1 trillion dollars every year.
Meanwhile, remote work has surfaced questions around the role of managers and
the approach to employee growth and progression.

So, how can we fix all of this? How can we modernize the whole process? Here are
five ways:


5 WAYS TO MODERNIZE CAREER PROGRESSION

Now more than ever, employee performance is critical to company success. Old
paradigms for employee development, performance management, and measuring impact
are holding companies back from realizing the full value and impact of
employees.

Here are five ways we can modernize career progression, better serve employees,
and improve the bottom line for companies:


1. MAXIMIZE EMPLOYEE IMPACT THROUGH CONTINUOUS PROGRESSION

Continuous employee progression is a philosophy and a set of processes that
create a transparent, actionable performance structure to enable iterative,
ongoing, and measurable growth.

Employees want to be fairly compensated, to know that the entire system is fair
(not just for them, but for everyone), and to be given ongoing, clearly defined
opportunities to grow in their careers. Continuous, “just-in-time” progression
is a way to do exactly that. 

Whereas the traditional annual review process is a once-a-year, manager-led
process in which the employee has little say, continuous progression is more
self-serve and employee-led. When a continuous progression system is set up
(here’s how Oyster does it, for example), employees can initiate a review
process at any time to gather personalized feedback from peers and managers on
their performance, skills, competencies, and more. 

This gives employees more frequent opportunities to gather and respond to
feedback, make adjustments, and make their cases for a promotion and/or pay
raise. When employees feel more invested and engaged in the review/feedback
process, they’ll be more productive and more likely to stick around. 

Annual reviews simply don’t cut it anymore. They’re inefficient, fraught with
bias, and rarely accurately capture the work and progress an employee has made
in the last year. It’s time to start moving toward a more continuous, ongoing
model of employee performance feedback. 

Pando is the first all-in-one continuous progression platform. To learn how
Pando can help your team move toward a more modern employee feedback model,
schedule a demo.


2.  STANDARDIZE JOB LEVELING

Job leveling is really about growth and mobility within the organization. When
you have standardized job leaving, you could have six levels or ten or whatever
works best for you. 

However, your number of levels lays the foundation for how people move through
your organization and how many opportunities they have to level up and feel like
they are progressing through your organization. So you’ll want to think through
that part carefully. 

Job leveling also creates a more equitable structure when the core foundation of
levels is consistent across every team. For example, engineering often has more
levels than marketing, and so engineering teams often get more opportunities for
pay raises and advancement. And because engineering teams are often made up of
more men, while marketing teams are often made up of more women, this only
widens the gender pay gap.

It’s critical to make job levels consistent across all departments so everyone
can be evaluated fairly. 

Here are a few more reasons job leveling is so important:

 1. Better hiring. There’s automatically more alignment on skills and level
    during the hiring process, which leads to fewer mis-hires. 
 2. Mitigates pay equity risk. When everyone knows what pay bands are associated
    with which levels, it reduces the risk of pay disparity and major issues
    later.
 3. Keeps you competitive. When you have demonstrable paths for growth, you can
    improve recruitment and retention.

Pando has helped hundreds of leaders create standardized job levels for their
teams. Schedule a demo to learn how Pando can help you.


3. ALIGN YOUR COMPENSATION PHILOSOPHY

Whatever compensation philosophy you use needs to align with the employee
performance management path you’ve chosen to take.

For example, if you use a continuous progression model as we talked about
earlier, that might mean that you’re doing a compensation evaluation once a year
to make sure every employee is earning a competitive market rate. If, according
to your market data, they’re not in the proper range, you make adjustments to
fix that. 

It might also mean that whenever employees move to the next job level, their
compensation is automatically increased at that time. So, it’s not tied to an
annual performance review.


4. ESTABLISH CLEAR CAREER TRACKS

It’s also important to have clear career tracks for both individual contributors
and people managers within your organization. And those career tracks must be
transparently shared with employees so everyone knows where they currently stand
and what their career progression could look like. 

Not only is this beneficial for current employees, but it could also be helpful
for recruiting new top talent. Everyone wants to know they can advance their
career in a company (and how they can advance it), but very few companies take
the time to create and share those pathways. If you do, you’ll always be one
step ahead of the competition. 


5. CREATE COMPETENCY-BASED CAREER FRAMEWORKS

Within each job level (which, again, should be standardized across the entire
company), there are competency-based career frameworks. Each level within each
department should clearly define which soft skills, hard skills, values, and
more should be associated with each level.

Domain-specific competencies will vary between engineering roles, marketing
roles, etc. but they should all contain the same number of competencies (e.g.,
6-12) so advancement is standard across the organization, regardless of what
team an employee is on. 

When executed correctly, competency-based career frameworks create more equity
and help managers and employees reduce bias and subjectivity in how they’re
assessed and how they give feedback. 

Did you know Pando can help you create competency-based frameworks? Schedule a
demo to get started.


CONCLUSION

Traditional annual reviews are outdated, inefficient, and fail to equitably help
managers evaluate employees and help employees advance their careers. Companies
that wish to increase employee performance, build cultures of transparency and
candor, beat their competition to top talent, and retain employees in a
competitive jobseeker’s market should start moving to a more modern approach. 

‍To learn how Pando can help your company modernize employee performance
management, schedule a demo here.

‍


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