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Next-Gen Performance: How AI and Agile Performance Assessment Transforms the Employee Experience

Jason Diamond Arnold

December 13, 2023

Do you need help to measure performance? This article explores three game-changing ideas that will revolutionize how you approach performance metrics and align with critical business objectives.

1. Moving from Measuring to Assessing Performance

2. Continually Assessing Performance

3. Improving the Performance Reviews Process Using AI Technology

The Rise of New Workforce Performance Paradigms

Over the first two decades of the 21st century, the digital revolution has transformed how we work, blurring the lines between personal and professional life. The Internet, WIFI, smartphones, and collaboration software like MS Teams and Zoom have enabled real-time collaboration across time zones, making traditional 9-to-5 workdays and workplaces a thing of the past. The COVID-19 pandemic dramatically accelerated the shift towards permanent hybrid and remote work, driving the need for performance management systems that reflect the new realities of how we work in the 2020s.

Today, our perception of 'Humans as a Resource' needs to evolve to embrace 'People and Performance' as a viable way of doing business in a knowledge economy. The value of today’s workforce lies in their output, well-being, and growth potential—not an assembly line of tasks. Because of the need for this evolution in business, performance management is no longer a static process but a dynamic dialogue that enriches the employee experience and positively influences actual business results. This is a fundamental shift in mindset, focusing on inspiring and harnessing the collective potential of a diverse, dispersed, and digital workforce.

The Irrelevance of Industrial-Era Performance Metrics in a Knowledge Workforce

The tools and metrics we traditionally used to measure performance must be revised to keep up with the blistering pace of changes in modern business. Performance metrics established during the industrial era are not solutions for the complex and interconnected world we live in today. These outdated measurements were designed for assembly lines and predictable workflows and now need to be capable of evaluating the digital workforce's dynamic and often intangible outputs in real time. They need to recognize the value of creativity, collaboration, and human innovation, which are increasingly crucial in 21st-century workflows.

Gallup's research has shown that the traditional annual review, a staple of performance management in the industrial era, is no longer effective. It reflects on past behaviors and achievements rather than promoting ongoing development and agility. Agile Performance is a modern process for navigating the new normal, where change is the only constant. The traditional annual review needs more insight or support for the continuous improvement needed for employees and organizations to thrive today.

1. Moving from Measuring to Assessing Performance

Today’s organizational leaders are doing more than just embracing new performance processes; they are also changing their mindset and behaviors toward performance. Instead of settling for a series of checked boxes or targets achieved, like traditional performance reviews, we now understand performance is more complex than just a laundry list of achievements. Behavioral science reveals that performance is a psychological and physical experience that ebbs and flows during any performance cycle. Because of a deeper understanding of people’s role in performance, many successful organizations are adopting an agile performance process that uses regular performance check-ins, pulse surveys, and performance assessments that evaluate and respond to a person’s motivation and skills toward their goals–not just the tasks they are checking off.

This change in how we evaluate performance has many organizations shifting to outcome-based performance assessments that value innovative ideas, emotional intelligence, and well-executed projects through people. Outcome-based performance inspires everyone in the organization to consistently think about what outcomes they are working toward beyond the tactical outputs they accomplish daily. It takes more than just a “time sheet” or list of daily accomplishments to effectively understand how people are performing, especially in a virtual workspace. 

An outcome-based approach to performance emphasizes ongoing quality conversations, feedback, recognition, and personal growth rather than rigid rankings and ratings that are difficult to note as ‘objective data.’ That’s why evolving beyond just performance measurements into a continual performance process of assessing and responding to performance needs is a more practical and meaningful approach to performance in today’s agile business world.

2. Continually Assessing Performance is Essential

A practical assessment of employee performance in the contemporary work environment requires regular and dynamic evaluations strategically designed to gauge and address performance needs in real time. Continuous performance assessment should consider employees' skills and motivation to achieve specific goals, not just their output. Regularly assessing skills and motivation ensures that each team member is recognized for their unique contributions and supported through the challenges of pursuing critical business objectives.

Best practices in leadership theory have revealed that people go through various states of performance toward a goal and are a combination of their ability and energy to achieve a goal–not just their will to achieve an objective. Responding to the situational performance needs of your people is a hallmark of outstanding leadership that encourages and inspires people to perform at a high level. Through AI-assisted performance check-ins and assessments, leaders can effectively respond to real-time performance needs, creating a continuous feedback loop emphasizing the end goals and quickly adapting to the means to achieve them.

3. Improving Performance Reviews through AI-Assisted Continuous Performance

Continuous performance assessment is essential to foster a culture of effective collaboration and high engagement in working toward business goals. When organizations move to an agile, continual performance process, using technologies like AI assistance to elevate ongoing conversations around performance, they create data that seamlessly integrates into formal performance reviews. Inspire Software responsibly uses AI technology to transform feedback into actionable data, generating meaningful insights that save time and provide a comprehensive understanding of an employee's performance during a defined performance cycle. This technology-enabled approach to performance elevates the value of performance reviews, making them a natural summary of ongoing conversations, not the imposed and exhausting process traditional performance reviews have been criticized for. In addition to improving the ease of formal performance reviews, regular performance assessments and conversations ensure that these formal evaluations reflect the total narrative of an employee's contributions over time, not just the grade used to evaluate a performance period. Continual performance helps the formal performance review process feel fair and more holistic than the traditional appraisal process.

Inspiring the Future of Performance Management

As we journey into the heart of the 21st-century work experience, it has become clear that organizations and leaders must urgently evolve to meet the demands of these new paradigm shifts in how we perform our work. We must embrace a balanced approach that values skill and motivation as scientifically proven ways to inspire people to excel at work through performance. It's time to transform from mere measurement to meaningful assessment, recognizing that adaptability, innovation, and human insight are the currency of today's business success.

Request A Demo Today

Inspire Software is your expert guide to peak performance through its sophisticated AI technology and foundations in leadership and performance theory. We are passionate about helping organizations harness their people's power and redefine success in a modern workforce. We extend an invitation to experience firsthand how Inspire is transforming the landscape of workforce performance. Request a demo today and join the revolution of those leading the charge toward a more inspired, engaged, and thriving future.

Learn more about the Inspire approach at inspiresoftware.com.