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Everyone seems to agree that performance management is a good thing, but few companies are effectively implementing performance management programs. So where’s the disconnect? What’s keeping so many companies from reaping the benefits of something as simple as a performance management program? In short, the answer is leadership.

As with most things in a healthy organization, the buck stops with the leadership team. In performance management, a leader’s responsibility is twofold. One is to lead by implementing the program and the other is to lead by example, participating in the performance management program both as a coach and a participant. That actual implementation is important, but the most important action for leaders to take is to set an example. In performance management, leading by example demonstrates that you value the process and it’s an opportunity to show solidarity with your employees and team. This will foster communication, collaboration and employee engagement, not to mention a successful performance management program.

In ancient Rome, a general exemplified how powerful leading by example can be. He won the admiration of his soldiers and was elected leader of Rome not by handing out favors and awards, but by sharing in the hardships of a military campaign, digging ditches, building walls and standing in the front lines. He demonstrated his solidarity with his soldiers by sharing in their physical training, labor and danger, not out of necessity, but out of principle. He didn’t ask his soldiers to do anything he wouldn’t, and showed them how he valued those actions and behavior by taking part in them as well. His soldiers were inspired to push themselves past what was required of them and the people voted for him because he led by example. Business leaders can reap similar benefits by imitating his example, especially when it comes to a performance management program.

This general, also recognized the inverse: it’s unwise for leaders to subject their employees to tasks and expect them to uphold values that they’re unwilling to do and uphold themselves. If they do, it creates an “us and them” culture in the workplace with the management team on one side and the employees on the other. This divide can easily escalate to an “us versus them” culture as resentment builds over unequal treatment. On the other hand, if the leader actively participates in programs like performance management it will build an “us culture” defined by open lines of communication. It’s these small things that either work to create a culture of teamwork and collaboration or feed a sense of resentment against the management team. Culture will form one way or the other. It’s the job of the leader to set and exemplify the values and behaviors that should characterize that culture. The same is true when it comes to a performance management program. It can either be used as an opportunity to build a culture of unity or divide leaders from their teams.

This demonstrates that leadership participation (leading by example) is the key to setting a culture where performance management can flourish, but what’s also important is the quality of that participation. If you treat performance management meetings as a box to check off, so will your employees. Alternatively, if you treat performance management as a structured opportunity to communicate with your team and give them feedback, they will also.

The quality of your performance feedback is also important because it helps employees gain a clear understanding of your expectations and how well they’re performing. In many ways performance management feedback is like comments from a professor on a rough draft of an essay. They help you understand what the professor is looking for and what you can do to meet that expectation. And the clearer and more detailed the comments the better the results will be.

This all points to the fact that workplace culture is set from the top down. That means for leaders wanting to create a work environment that values performance management they have to set the example in how they talk about and follow through on performance management. As I mentioned earlier this means being willing to subject yourself to the performance management program, but it goes further and means becoming fully invested in the program. Below are some key ways to successfully implement a performance management program and create a culture that values and invests in it.

• Performance Management is for Everyone: An important part of investing in the performance management program is by making sure it is included in everyone’s objectives no matter where in the business structure they fall. This also means taking those objectives seriously when it comes to you and your upper management team. Take the time to review and coach them, it will not only improve their work, but set the example for the rest of the company.
• Recognize the Value of Feedback: How can you improve if you don’t know what you’ve done right or wrong? Often feedback slips through the cracks or only comes when something has gone terribly wrong. If the only feedback an employee gets is negative, than they will be concentrating on not making a mistake. Instead regular feedback given through performance management conversations shows employees where they can improve and gain an understanding of what is expected. This gives employees the opportunity to work to please or impress their managers instead of merely avoiding punishment. Remember what is true for your employees is also true for you, so be the example, encourage and value feedback about your performance from your team.
• Praise is Important: Praise is a great for boosting confidence and morale. It also works as an opportunity to tell employees when they’re meeting and exceeding expectations in a way that encourages them to repeat their performance. Most people aim to please their leaders and appropriate praise encourages this behavior while withholding it will leave employees jaded and unengaged. The best way to encourage your management team in this practice is by exemplifying the behavior yourself. This will go a long way to creating a positive and healthy culture in the workplace that is focused on producing great results.
• Consistency is Crucial: The real value of a performance management program is that its structure produces regular consistent feedback. It does this by making feedback a regularly scheduled event. Without a performance management program who would put an event in their calendar that states, “Give Susan feedback today”? It would seem foolish, but with a performance management program it allows leaders to create a regularly scheduled event to give their employees feedback. This regularity allows leaders to catch problems or miscommunications early and give regular encouragement to keep employees motivated. It also presents an opportunity for leaders to lead by example by simply being the one to schedule the event.
• Keep it Simple: A performance management program could be as simple as a ten-minute conversation once a week. The best performance management program is one that you can commit to doing regularly. If you make it too complex or time consuming, the odds of it getting done decrease significantly. Every time you cancel or postpone a performance management meeting you are implicitly telling your employees that it’s not that important and they will begin to see it as one more box to tick. Leaders have the opportunity to demonstrate the value of these meetings by making them a priority, so choose a length and format you can commit to consistently.

The real value of a performance management program is as a framework for communication, specifically about an employee’s performance. Communication is the key to any healthy relationship and in the workplace this makes it essential for employee engagement and talent retention. Employee engagement is crucial for productivity and a healthy relationship with their manager is critical for talent retention because employees tend to quit managers not companies. This makes performance management even more valuable if done correctly, while also helping employees learn and improve, leading to greater productivity and innovation. The key to realizing this value is by communicating it to your employees through your own participation in all aspects of the program.

Performance management programs are an invaluable tool to increase productivity, engagement and communication between leaders and employees, but only if leaders are willing to set the tone. Beyond the leader’s responsibility to set the cultural norm for their team, they too can gain from a performance management program both from their superiors and from their team. They can learn to improve and customize their leadership and communication style to the needs of their team. This will further open up lines of communication, help the leader improve their own skills, and create a more collaborative culture in the workplace. The benefits are clear, performance management improves productivity and the workplace, but only if leaders are willing to follow the golden rule and lead by example.