What is performance management software?
Performance management software helps HR departments and managers assess the performance of employees, ensuring alignment with company goals. This type of solution can be a standalone application that integrates with other HR systems, such as payroll, or it can be a module within a broader HR management platform.
Generally, performance management software offers features for setting employee goals and expectations, tracking employee performance in real time, coaching, conducting one-on-one meetings, collecting feedback, and recognizing employees’ accomplishments with rewards. After gathering performance data, managers can make more informed decisions about compensation and development at the individual level and across the organization as a whole.
We reviewed the top performance management software solutions on the market and narrowed it down to the best of the best:
- BambooHR is the best HR software with performance management features.
- Leapsome is best for robust analytics and actionable insights.
- PerformYard is best for a personalized user experience.
- 15Five is best for promoting career development and upskilling employees.
- Lattice is best for performance-driven compensation management.
Featured partners
Our picks for the best performance management software
BambooHR: Best HRIS with performance management
Pros
Cons
BambooHR is one of the top HR platforms on the market for a reason; its people-first approach attracts small businesses with lean HR and IT departments. Compared to other top solutions, BambooHR’s native performance appraisal solution lacks some of the more advanced, customizable features like support for career planning and continuous feedback.
Instead, BambooHR focuses its performance management capabilities on manager and employee self-assessments, peer feedback, and goal setting. As a result, BambooHR’s simplified approach allows for a more accessible and efficient user experience, even for companies just adding performance review flows into their company processes.
In addition, BambooHR’s performance management module also seamlessly integrates with its current mobile application. Employers already using BambooHR’s mobile app for employee information, time tracking, or document sharing can seamlessly add performance management to start tracking and updating their goals from anywhere. Both managers and employees can add or respond to comments on goals through the app, so managers and employees can be held accountable, even in roles not typically tied to a desk.
Add-on modules
As an all-in-one HR software solution at its heart, users can leverage other BambooHR modules for a more well-rounded employee experience. With additional modules like employee training tracking and payroll, employers can capture employee data in one centralized source of truth. In turn, employees remain informed about their performance throughout their tenure at the company for a more transparent and consistent experience.
Performance management integrations
BambooHR’s popularity as an HR software means users are not limited to its native performance management add-on. Through BambooHR’s marketplace, users already subscribed to BambooHR’s Essentials or Advantage plans can integrate with other top performance management solutions. Thus, scaling businesses don’t have to sacrifice their core HRIS as they outgrow BambooHR’s native program in favor of more advanced functionality.
BambooHR includes a one-time implementation fee with a project manager. Companies with 20 or fewer employees can opt for Quickstart Training for $299.
Essentials
- For up to 20 employees: $108 per month flat rate.
- For 21+ employees: $5.40 per employee per month.
- Volume discount applies after 25 or more employees.
Advantage
- For up to 20 employees: $180 per month flat rate.
- For 21+ employees: $9 per employee per month.
- Volume discount applies after 30 or more employees.
Add-ons
Payroll (US only)
- One-time implementation fee
- For up to 20 employees: $150 per month flat rate
- For 21+ employees: $7.25 per employee per month
- Volume discount applies after 21 or more employees.
Note: Additional factors, like the number of FEINs or the number of states you need payroll for, can affect this price. Please contact BambooHR for specific pricing quotes.
Benefits administration (US only)
- $5.25 per employee per month.
- Volume discount applies after 30 or more employees.
Time tracking
- $3.00 per employee per month.
- Volume discount applies after 30 or more employees.
Performance management
- $5.25 per employee per month.
- Volume discount applies after 30 or more employees.
BambooHR’s simple plug-and-play performance workflows are great if you are developing performance review cadences for the first time. Automated reminders will prompt your employees to complete performance evaluations, while detailed analytics will provide you with the necessary data to make the most of your current talent pool.
Moreover, BambooHR’s popularity as an all-in-one HR platform means you are not limited to its native performance management solution. Instead, you can integrate with more advanced stand-alone solutions like Lattice and 15Five to meet your specific needs — without sacrificing your core HR program.
Leapsome: Best for performance analytics
Pros
Cons
Leapsome is a dedicated performance management software without traditional HRIS capabilities like payroll, time tracking, or applicant tracking systems (ATS). However, Leapsome has significantly more advanced and customizable performance management features, such as:
- Objective and key results (OKR) management.
- One-on-one management meetings.
- 360-degree reviews.
- Engagement surveys.
Leapsome offers several modules, such as Reviews, Surveys, Goals, and Learning, to address every area of performance management, including employee-manager feedback, compensation management, and career planning and development. The modules are priced separately, so you can select them à la carte to address specific business needs or combine them for a holistic approach to performance management.
While other performance management solutions are limited to standard reporting tools, Leapsome takes its analytics further with multi-language support and artificial intelligence (AI) capabilities. For instance, multinational corporations can use Leapsome to track the performance data of their international employees in the language of their choice.
Furthermore, Leapsome’s AI can track employee sentiment across the organization based on engagement survey results and predict departments at risk of turnover. By combining this data, employers can determine where they can focus their retention efforts, address poor performers, and drive engagement on a global scale without needing to leverage multiple platforms.
Review analytics
Leapsome includes multiple ways for employers to engage with performance data following review cycles, including visualizations like heatmaps, 9-boxes, distribution charts, timelines, and radar charts.
HR teams can customize the data to track an individual’s performance over time and even compare performance data among teams. Employers can then make data-driven decisions when determining the best players for particular projects to improve overall company performance.
Engagement survey benchmarks
Leapsome users can conduct employee engagement surveys and set internal company benchmarks to track employee sentiment, satisfaction, and employee Net Promoter Scores (eNPS) over time.
HR teams can also use benchmarks to compare their engagement data with similar companies that use Leapsome based on location, industry, and size. By comparing their data to others, Leapsome provides insights for employers on areas of their business that need improving while remaining competitive in their field.
Leapsome starts at $8 per user per month, which includes its Competency Framework, Instant Feedback, and Meetings modules. You can add on the following modules for an additional per user per month cost:
- Reviews.
- Goals.
- Surveys.
- Learning.
- Compensation.
Other things to note regarding Leapsome’s pricing:
- 14-day free trial available.
- Multi-module and volume discounts available.
- Must contact sales for a quote on any added modules.
Compared to BambooHR, Leapsome is ideal for mid-to-large companies that need more granular insights into the strengths and weaknesses of their existing talent base. By collecting review scores, OKRs, and employee sentiment data, you can compare these against Leapsome benchmarks so you can see how you stand up against your competition.
As a result, if you are a larger company with a global workforce, Leapsome is exceptionally equipped to handle complex performance cadences while gathering data to help with compensation, succession planning, or other long-term company goals.
PerformYard: Best for customer experience
Pros
Cons
PerformYard is at the top of many performance management software lists because of its intuitive user interface (UI), transparent pricing, and attentive customer service. PerformYard has a limited breadth of features, like career development and compensation management, compared to other performance management solutions on our list.
However, PerformYard provides users with just enough customization within its modules to tailor their performance review cadences into their dynamic workflows without overwhelming employees in the process. As a result, employees, in particular, praise PerformYard for its ease of use and ability to quickly tie their goals to performance.
In addition, PerformYard gives employees a sense of ownership over their performance through self-assessments, private performance notes, anonymous reviews, and constructive feedback requests. Managers can even create their own review questions and cadences to monitor employee progress and support under-performers.
Continuous feedback
PerformYard emphasizes continuous feedback in every aspect of its software, from one-on-one meeting cadences with managers and peers to immediate feedback and 360-degree review cycles, including input from external stakeholders.
Peers and management can even recognize other employees by broadcasting their wins to the company on PerformYard. By keeping employees informed on their performance, employers can address performance issues quickly while encouraging employee career development and growth.
Customer service
In addition to traditional customer service support options, PerformYard provides a dedicated customer success manager to every customer to answer questions and address any challenges they come across. PerformYard also has an extensive support page with how-to articles and in-depth videos. For companies without an IT team or little technological know-how, PerformYard’s support ensures companies are set up for success, even past the implementation stage.
PerformYard starts at $5-$10 per employee per month, billed annually. You need to call for an exact quote depending on the features you need, such as performance reviews, check-ins, goals, and feedback.
For employee engagement features, like surveying and analytics, there is an additional cost of $1-$3 per employee per month.
If you’re a company without a dedicated IT department or just developing an automated performance review cadence for the first time, PerformYard is an excellent option. Its system is easy-to-navigate, and its customer support team helps you set up your unique performance cycles without an initial setup fee, like BambooHR.
Moreover, PerformYard is a much more affordable stand-alone solution than others on our shortlist. So, if you’re simply looking to add feedback cycles and performance tracking to your current HR stack without some of the advanced capabilities of Leapsome or Lattice, PerformYard may be your best bet.
15Five: Best for career development
Pros
Cons
Like PerformYard, 15Five uses a simple user interface and weekly feedback structure to foster employee transparency and continuous improvement. However, 15Five stands out for its holistic approach to performance management and emphasis on career progression.
15Five includes four different products—Engage, Perform, Focus, and Transform—that companies can pick and choose to address the areas of performance management most vital to them. However, 15Five intends for all four products to work together, as each builds upon the previous.
For example, employers can identify what areas of the company need improvement in Engage, tie this with employee performance in Perform, address problems with goal setting in Focus, and give employees opportunities to grow with Transform.
Because of this approach, 15Five documents employee progress throughout their time in the organization, so employers can make calculated decisions on fostering employee career development. This allows managers to upskill their current staff to address recruitment challenges and aid in succession planning strategies when employees leave or retire.
Role Clarity
With Role Clarity, managers can outline an employee’s job description and responsibilities, so employees understand what is expected of them from day one on the job.
Employees can also engage in two-way conversations about their assigned tasks and work together to adjust their responsibilities as needed. Managers can then tailor employee responsibilities as they watch their employees grow in the role, so they remain energized and motivated to succeed.
Career Vision
Through Career Vision, employees can access a vision board to identify their ideal days, what things they want to do more, and what things they want to do less. Managers can then adjust their meeting cadences and workflows to maximize employee efficiency while aligning employees’ career goals with manager expectations.
Coaching sessions
15Five’s Transform add-on allows employees to engage with career experts to grow in the areas most important to them. As a result, turnover reduces, as employees feel encouraged and supported by their managers and companies to succeed personally and professionally.
15Five includes 3 main modules you can choose from (all billed annually):
- Engage: $4 per user per month.
- Perform: $8 per user per month (note: includes everything in Engage module).
- Focus: $8 per user per month.
You can also purchase the Total Platform for $14 per user per month.
15Five’s Transform module is custom-priced, so you will need to contact 15Five directly for a quote.
15Five is the only vendor in our shortlist that offers career development features in its core platform rather than as an add-on. All users get access to role clarity and career vision in 15Five’s Perform, Engage, or Focus plans so that you can also monitor your employees’ professional goals during every performance cycle.
Beyond career development, 15Five ticks all boxes for a full-suite performance management software, from performance appraisals to feedback, manager check-ins, and goal-setting. But, if you want to keep your employees both challenged and engaged in their current roles through continuous development features, 15Five stands out among the pack.
Lattice: Best for compensation management
Pros
Cons
Lattice is a top favorite performance management solution among employers and employees because it offers the most comprehensive selection of features, such as continuous feedback cadences similar to PerformYard, career development features like 15Five, and robust analytics like Leapsome.
However, Lattice is an expensive solution, with a minimum annual contract of $4,000, and a steep learning curve among administrators and employees alike. Therefore, it may not be the best option financially for teams with limited budgets or just starting with a performance management solution.
Despite this, Lattice is optimized to handle large, diverse teams while providing customized and granular insights into their performance. Notably, Lattice differentiates itself from the other solutions on this list by offering a Compensation product dedicated specifically to measuring performance to inform promotions and raises.
Besides setting up compensation review cycles, Lattice also allows users to create compensation guidelines and benchmarks to maintain consistent and fair compensation practices among employees with similar roles, experience, and tenure. As such, Lattice may be perfect for organizations needing to implement equitable compensation strategies that directly correspond with employee performance-based metrics instead of a manager’s gut feelings.
Benchmarking data
During employee compensation reviews, Lattice allows managers to access compensation market data according to the employee’s role, location, and industry. Companies can remain competitive and reduce turnover by comparing an employee’s compensation to similar positions. Moreover, it helps companies reduce internal pay disparities by ensuring employees in the same role follow similar pay schemes.
Budget and spend tracking
Managers can review compensation changes over time to determine an individual employee’s return on investment. In addition, Lattice provides merit and promotion raise guidelines, so companies can easily tie employee performance with appropriate compensation changes while staying within budget.
Lattice includes the following modules, which you can mix and match:
- Performance management + OKRs & goals: $11 per person per month.
- Engagement: $4 per person per month.
- Grow: $4 per person per month.
- Compensation: $6 per person per month.
Minimum annual contract is $4,000 with multi-product and volume discounts.
Although both Lattice and Leapsome include compensation management modules, Lattice’s far outshines Leapsome’s, with market benchmarking data and in-app notes among compensation decision-makers for transparency.
Plus, Lattice allows you to tie compensation to your performance reviews to reward the high-performers while remaining competitive and fair among your employees with similar roles and tenure. This can also help you build compensation and promotion strategies that support your DEI initiatives, like mitigating biases by focusing on employees’ successful completion of goals.
Find your new performance management software
What are the benefits performance management software?
Boosts morale and motivation
One of the most important elements of performance management software is facilitating performance reviews. Regular performance reviews let managers recognize individuals for their hard work, improving employee morale. Moreover, performance management software includes feedback features that support consistent communication between managers and employees.
Along the same lines, many performance management software solutions have employee recognition and rewards capabilities, enabling organizations to further show appreciation for employees’ work. When companies consistently praise workers for exceptional performance, this encourages other staff members to enhance their own performance.
Strengthens employee retention
Regular feedback sessions give employees opportunities to interact with their managers and raise concerns. The organization can then resolve said issues as soon as possible. Workers are more likely to stay loyal to the company when their concerns are swiftly addressed, improving employee retention.
Supports employee engagement
Performance management software’s continuous feedback and one-on-one manager meeting features make employees feel heard and included in the organization. Further, these mechanisms help employees better understand what’s expected of them. When employees have clear guidance on day-to-day tasks, their efforts naturally achieve better outcomes.
Surfaces skill gaps and opportunities
With frequent performance check-ins, managers can better monitor and understand the skillsets and capacity of employees. HR teams can pinpoint individuals with skill gaps and introduce training to bridge the gap before it impacts productivity. At the same time, regular performance reviews also reveal which employees are ready for a promotion or increased responsibilities.
Encourages employee agency
Numerous performance management solutions let employees view their work progress and set business goals for themselves. Employees feel valued and more engaged because of their active involvement in the decision-making process.
What are the types of performance management software?
Check out our video overview on the four major types of performance management software below:
The business impact of performance management software
A good performance management solution enables businesses to reach goals faster and in a more structured manner, providing a real-time view of the workforce. When properly utilized, performance management software can increase employee productivity and engagement, decrease turnover, and maximize revenue per employee.
Performance management tools foster consistent and transparent communication between employees and employers. This builds trust and makes workers feel more supported, improving retention and preventing turnover. Furthermore, it lets managers and employees set clear and attainable goals that align with the company’s objectives.
With performance management software, leaders can pinpoint each employee’s strengths and weaknesses. With this data, organizations can advance employee professional development and help them overcome weaknesses.
More performance management resources
