HR Mavericks

Eddy’s HR Mavericks Encyclopedia

Performance Management Software

Performance management software can be a great asset to your company. Not only can it reduce bias and increase accuracy, it can also increase company retention. Continue reading to find out what performance management software is, why it’s beneficial and more!

What Is Performance Management Software?

Performance management software is a tool that allows an organization to enhance and support employee productivity. There are a wide variety of performance management software suppliers. These softwares can guide the evaluation process, gather feedback and provide simple processes for managers and employees to set objectives, engage in career-development dialogue, link employees to learning options, and track goals. The review process can be configured and automated to track continuation and completion through the use of workflows, notifications, check-ins and dashboards.

Why Is Performance Management Software Beneficial?

Performance management software is beneficial because it allows your management to view employee development in real time. It can also increase engagement throughout the year and provide more transparency in the review process through the use of data-driven decision making.
  • Employee development in real time. When a structured performance management system is in place, you can help employees clearly realize their objectives and how to track them efficiently. Some systems allow employees to update their progress towards goals which can be seen by management in real time. When managing multiple employees, software can be especially helpful to measure performance while making staffing decisions. Multiple data points can be used to bring everyone up to speed.
  • Increase engagement. If an organization conducts annual performance reviews, it may be difficult to track overall progress of goals and objectives throughout the year. Performance management software can increase communication between management and employees throughout the year by encouraging check-ins and updates. As engagement increases during the year, your workforce is better able to accomplish goals by the time annual reviews come around.
  • Make data-driven decisions. After you implement a performance management software and collect performance appraisal from your workforce, you can begin to predict performance using data analytics. You can rely on trends, along with identifying and incentivizing top performers, which can result in reduced turnover. Other results include increased feedback, reduced bias and greater accuracy.

Who Uses Performance Management Software?

If your management team trusts your performance management software, it is more likely to succeed. The HR department should provide thorough training to management so they fully realize how to conduct reviews and follow up with employees.

Human Resources

The HR department typically manages the software and works to continuously improve it. HR provides training or may work in conjunction with the training department to teach and provide instruction to management on how to use it.


Managers can rely on the software to track performance discussions and employee goals, and ultimately allow them to oversee the performance management process.


Your workforce can have a much better idea of what is expected of them through the use of performance management software. Most software allows employees to log in at any time to review their goals and update their progress.

Important Features of a Performance Management Software

Making sure the features of a performance management software align with your business needs is one of the most important factors in selecting a platform. Although many performance management softwares perform several of the same functions, not all have the same features. You may want to consider the following when choosing a software that is right for your company.

Automated Schedules

The ability to set performance review schedules is very important to help your management and employees keep track of when reviews are due. Depending on the structure of your company, not all managers may perform performance reviews at the same time during the year. So the ability to set various schedules might be something you need to look for.


If you want to manage the performance of your workforce on an aggregate level, you may want to consider a feature to measure performance holistically through the use of data analytics. Data can typically either be shown on a comprehensive dashboard within the software, or exported, typically as a CSV or excel file. Some softwares include dashboards that allow you to view data based on individual and/or team progress.

Annual Summary

All of the appraisal meetings and documented goal discussions during the past year can be easily viewed on a comprehensive report summary. Sometimes this is called a “report card.”

Tips for Choosing the Right Performance Management Software

Tips for choosing the right performance management software include making sure it is compatible with your existing software and ensuring it is user-friendly and scalable.

Tip 1: Human Resource Information System (HRIS) Compatibility

If your company has an existing HRIS, then choosing a software that is compatible with it can be a great help. Most HRIS systems already provide performance management software. It may be included in your current company subscription or you may have to pay extra depending on how your current package is set up.

Tip 2: User-Friendly

If the software isn’t easy to navigate for management and employees, they likely won’t use it. Plus, if the software is intuitive and promotes flexibility, you won’t have to spend as much time training others how to use it.

Tip 3: Scalability

What does growth look like for your company? Do you plan to increase headcount in the near future? If so, you may need to consider software that is scalable to keep up with your future business needs.

Best Practices for Using Performance Management Software

Some best practices for using performance management software include encouraging continuous conversations about performance management and accurately measuring job criteria.

Continuous Conversations

If your performance management software allows you to log additional conversations or updates, you’ll definitely want to take advantage of this. Some employees prefer to have check-ins weekly, annually or daily. When managers understand the preferences of their employees and take an interest in their performance, they are more likely to feel valued.

Accurately Measure Job Criteria

If your software provides specific criteria that is relative to the job of the person being evaluated, positive change is more likely to occur. Management should be involved in the design to ensure the performance metrics are relative.
James Barrett

James Barrett

James has worked in the HR field going on 5+ years and has held various positions of leadership. His areas of expertise are in benefits, recruiting, onboarding, HR analytics, engagement, employee relations, and workforce development. He has earned a masters degree in HR, along with a nationally recognized SHRM-SCP certification.
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Frequently asked questions
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