What Is Employee Management + Tools & Tips
Charlette has over 10 years of experience in accounting and finance and 2 years of partnering with HR leaders on freelance projects. She uses this extensive experience to answer your questions about payroll.
Jennifer Soper is an HR Specialist and staff writer for Fit Small Business, with over 15 years of experience in accounting, payroll, and human resources.
Employee management is a broad term that encompasses every aspect of managing, developing, and interacting with your employees. The aim is to give your team members every tool and advantage necessary to help them achieve their personal goals so that your company reaches its corporate objectives.
When properly managed, employees become more efficient, engaged, loyal, and supportive of the company and their work. As such, your company can expect increased employee satisfaction, engagement, retention, and overall cost savings.
6 Key Areas of Employee Management
Employee management can be broken down into six key areas: hiring, measuring, interacting, developing, rewarding, and disciplining.
Effective employee management will require your adherence to all six areas, as each one builds on the next. A misstep in any one area could snowball.
Effectively managing your employees begins with the hiring process, from the initial job posting, extending through the employee’s first few weeks on the job. By taking the time to properly manage each stage of hiring, you can ensure that you are making the best possible choices for your team.
The first step is to create a detailed job posting. Besides including the description of the position, you must also list all the desired qualifications. Once applications have been received, it is important to review them all carefully before moving on to interviews.
During interviews, ask questions that will help get a better sense of each candidate’s qualifications and abilities. Be sure to give each candidate an opportunity to ask questions about the position and company.
When hiring, look for a job applicant who checks off as many of your qualifications as possible. No one will be perfect, but the more boxes an employee checks, the smoother your experience will be in managing them.
For each position you have in your company, you must understand the key metrics for that role—the items that make someone successful. Measuring an employee’s performance based on these metrics allows for a fair assessment of their work.
Evaluating each employee’s performance regularly allows your team to get feedback and make adjustments to their work—helping you ensure you’re getting maximum output from every employee. Communicating with your team about how you grade their performance and then grading on those exact metrics goes a long way toward being seen as a fair manager.
Take note that there is a fine line between effective performance tracking and micromanagement, which we will touch on later.
Effective employee management doesn’t involve just conducting performance reviews. As a manager, you must be in tune with your team, and that means having an open and consistent line of communication with them.
Regularly do the following:
- Communicate job expectations
- Provide positive feedback
- Give constructive criticism
- Listen
This doesn’t mean you constantly stand over their shoulders. The more important thing is to explain why employees should do things, rather than telling them how. That’s a big difference between an effective manager and a micromanager.
Employee turnover is both painful and costly. Your success depends on increasing your employee retention, and developing your employees is one way to achieve that goal. Through effective employee development, you can help your team learn new skills, giving them the growth they seek. Having new and advanced skills without hiring a single new employee is an excellent benefit for your company.
In this way, effective employee management focuses more on the coaching aspect. Seeing an employee’s potential allows you to assist them in gaining new skills that benefit not only them but also your company. The more you invest in your employees, the more loyal they will be to you.
Many managers lean toward correcting bad behavior or only speaking with employees when a job or task was done improperly. This is a poor approach and will lead to your employees equating any conversation with you as a negative one.
You must provide positive feedback when things go well. You don’t need to throw a party every time an employee gets a task done right and on time, but try to recognize hard work, effort, and collaboration. A simple “nice job,” or “I really appreciate your effort on this project,” can go a long way and may help soften those more unpleasant conversations.
While it is no one’s favorite part of being a manager, disciplining employees is crucial to keeping your team on track. Disciplining takes many forms but usually revolves around progressive corrections—increasing the level of reprimands for each instance of poor behavior or poor work performance. Be sure that you follow your company’s progressive discipline policy so that you’re treating all employees fairly.
It’s unpleasant to have a conversation with an employee who is underperforming, but I find it serves two purposes:
- You can help the underperforming employee correct their actions and chart a path for their success.
- You send a message to the rest of your team that you will not tolerate poor performance or unacceptable behavior.
If you need more guidance on how to handle an employee’s poor performance, check our tips for employee discipline.
Employee Management Tools
Employee management is a core component of your company’s performance management system. This system will include tools to help you effectively manage your team to ensure maximum efficiency.
Tips on How to Manage Employees
Employee management is a constantly evolving process. But there are certain constants that remain part of a solid foundation of effective employee management.
Communicate Clearly & Often
Never shut employees out. Sure, they may not need to know the intricacies of the company budget, but as it relates to their daily duties, make sure they see why their piece of the puzzle is important.
The best way to do this is to keep open lines of communication. This applies whether you are working in the same office and speaking face to face or if you have a remote-first company and communicate via other means. Your employees will thank you by being more loyal, engaged, and efficient.
Don’t Micromanage
This is hard for many managers and small business owners to hear. Study after study consistently shows that when employees are given the tools to do their job and then trusted to do so, they perform at higher levels and more efficiently. Micromanaging employees has the opposite effect.
When you hire an employee, you must trust them to do the job. While you should train and guide them on the steps to take to accomplish the job, you should also believe that they can determine the individual steps as needed. If you don’t trust them to do the job, they may be the wrong employee.
Micromanagement is not avoiding feedback altogether. Rather, it is allowing employees to do the job you hired them to do. Check out our guide to the top people management skills managers should have for more advice.
Give Fair Feedback
Providing both positive and negative feedback to employees is part of your job. It may not be your favorite, but it is still a crucial component of employee management.
With every employee, be fair. If, for example, you are discussing an employee’s repeated tardiness, mention that it violates your company attendance policy to be late. Also, ask if there’s anything you can do to help. Maybe they were having car issues or had a sick child—it is possible that they have a perfectly good reason for their tardiness and, by being fair to them, you demonstrate your flexibility.
Understand Legal Issues
Managers are the front lines of ensuring a company adheres to employment laws and must understand how to follow them. Otherwise, your business could face serious legal consequences.
You cannot discriminate against employees based on:
- Race
- Color
- Religion
- Sex
- National origin
- Age
- Immigration status
- Genetic information
- Disability
If you are disciplining employees who fall into one of the above-protected classes but other poor-performing employees are not receiving the same treatment, you could open yourself up to legal liability for workplace discrimination.
You must take care to ensure that you treat each employee fairly and equally. That’s why it is in your best interest to have clear employee management policies and procedures in place for you to follow each time. This can help you avoid legal scrutiny and claims of workplace discrimination.
Above all, remember that what you do for or to one employee, you must do for or to all. Have a policy and rigorously stick to it.
Bottom Line
Managing employees is a stressful job. You’re trying to motivate your employees to get the work done efficiently and accurately while also managing their expectations. No manager or company has mastered this process, so don’t be too hard on yourself.
Make sure that you are doing everything you can to build loyalty and trust with your employees by communicating openly and clearly with them. The best managers are more like coaches, providing both positive and constructive feedback while developing their employees’ skills through effective employee management.
