If we want our companies to thrive, we need to fill our ranks with motivated employees. For that to happen, we need a performance management system in place that promotes communication, trust and valuable feedback. Everyone involved needs to know that they are a crucial member of the team, that they are being heard and that their manager is in their corner. Unfortunately, many companies are still operating with a performance management system that places far too much emphasis on control, rather than encouragement, support and development.

In terms of performance management, it’s worth noting that the goal of continual improvement is the same as it has ever been. With employee coaching, however, the process is more collaborative.

Over the past few years, the concept of employee coaching has received a great deal of attention. Could the idea of coaching employees, rather than managing them, be a game-changer? Or is it just another HR buzzword?

What are coaching conversations?

Coaching conversations involve forward-thinking, one-on-one discussions with employees that ensure they are aware of their work and goals, that they have the tools they need to perform and that they have the confidence and skills required to succeed.

In terms of performance management, it’s worth noting that the goal of continual improvement is the same as it has ever been. With employee coaching, however, the process is more collaborative. Employees are being asked to lead conversations and make more decisions about their roles, their goals and their training. The idea is that, with increased ownership and autonomy, employees become more confident and more empowered – but employees can’t do this all by themselves. They need their manager in their corner to offer guidance, support and encouragement.

With coaching conversations, the manager retains an important role, but rather than simply telling people what to do and when, their role is to help employees develop into self-reliant, capable workers. Coaching conversations need to be tailored to encourage (to name a few):

• An awareness of the employee’s skills and strengths.
• An awareness of where they could improve.
• An ability to set clear goals.
• An ability to deal with stressful situations.
• An awareness of the role they play as part of a team and how their work and attitude affect others.

Performance reviews versus coaching conversations

So what’s the real difference between a performance review and a coaching session – and why does it matter?

Traditionally, performance reviews have been rare, formal conversations that are specifically designed to evaluate performance. These conversations are usually pressure-filled as employees know they have a lot riding on them in terms of promotions, pay rises and bonuses. Furthermore, it’s rare that an employee enjoys being judged, so such conversations end up being a source of dread for those involved. Performance reviews are also more structured — they are carefully planned and scheduled meetings.

Coaching discussions can be planned, but they are also generally more spontaneous and agile. Employees are encouraged to drop by for a discussion as and when they need one, and managers can talk to employees when needed. The employee and manager might choose to discuss:

• Training or development opportunities.
• Goals and objectives and whether the employee is getting the support they need.
• A behavioural change affecting work and whether the employee needs certain measures to be put in place.
• Any changes within the company.
• Specific challenges the employee is facing.

The business benefits of coaching conversations

Coaching conversations have a focus on development and specific, individual needs. This means, when done well, a coaching approach to management can be hugely cost-effective for businesses. Rather than having to hire new employees with specific skills, which can be hugely expensive, coaching allows managers to develop the skills of existing employees. This is also hugely important to employees as they generally look for continual learning and development opportunities in a job role, which means retention and engagement is improved.

Coaching shows employees that they are valued, needed and supported, and employees with this degree of respect and trust are unlikely to feel compelled to look elsewhere for job opportunities. Coaching also greatly appeals to the average millennial’s mindset — they want continual feedback and support, but they don’t want to be micromanaged. Most would prefer to work for themselves, and this employee-led, collaborative approach to performance is a happy middle ground.

What’s more, coaching conversations allow managers and employees to build closer relationships. With increased communication, trust and transparency, employees learn that their manager is in their corner. They’re not an authority figure simply concerned with the bottom line.

Coaching can make a big difference to motivation levels. By being more involved in the goal-setting process and by having an increased say in how they work, employees have greater ownership over their careers. Their goals make sense to them, they have more meaning and they have more of an investment in making sure they are achieved.

Finally, coaching conversations allow more opportunities to celebrate success — and we all know the importance of recognition and reward when it comes to employee engagement and satisfaction.

How often to hold coaching conversations

The beauty of coaching conversations is that they aren’t too regimented, and they’re not too much of a drain on time. Having said that, managers should ensure that they happen fairly regularly. Frequent, informal, quick catch-ups are best. It’s a good idea to have coaching conversations no more than once a week, but no less than once a month.

How to have coaching conversations

When holding coaching conversations, employees need to learn how to listen. Rather than imposing solutions, managers need to guide employees and help them come to their own conclusions while providing valuable information and encouragement. Coaching is more about asking 'how can I help?' rather than saying 'this is how you should do it'.

Equally, managers should be trained to listen to more than what is just being said. Remember, communication is only 7% verbal. We say a lot with our body language and tone of voice. Managers should be alert and look for signs of burnout, disengagement and poor wellbeing. This becomes easier and more natural with increased interaction, so be sure to meet with employees regularly and demonstrate that they are a real asset to your company.

Interested in this topic? Read Performance management: why poor results should be managed with coaching, not disciplinaries.