Did you know that the quality of the workforce is the second biggest challenge for small businesses in the US, right after inflation?
Managing employee performance effectively is the key to growing your business and hitting your goals, but many small businesses struggle to find the right tools for performance and workforce management.
In this article, we'll explore some of the best performance management software on the market, focusing on their features, pros and cons, and ease of use, so you can find the perfect fit for your business.
TL;DR
- Effy AI: Thanks to AI-powered insights and a user-friendly interface, Effy AI is a great choice for small and mid-sized businesses looking for performance review software that's quick and easy to implement but doesn't compromise on features and accuracy.
- 15Five: 15Five can be a good choice if you want to implement continuous feedback by creating quick and simple surveys. However, it may not be the best option if you want to get more in-depth insights and detailed reports.
- PerformYard: PerformYard allows you to create highly customizable performance reviews, making it a good option if your company or industry has specific requirements that are not standard. On the downside, it doesn't have a lot of integrations.
- Profit.co: If you're looking for performance-tracking software focused on goal-setting and OKRs, Profit.co may be worth considering.
- Trakstar Perform: Trakstar Perform is a user-friendly performance management platform that's easy to use and implement. The only downside is limited integrations with third-party tools, which may require you to invest in other Trakstar tools to meet all your HR needs.
- AssessTEAM: AssessTEAM can be a good option if you're looking for a comprehensive feedback and performance management tool with features like customizable reviews and competency assessments, but be aware that it has fewer integrations than some tools on our list.
- Workleap Officevibe: If your main goal is to enhance employee engagement, Workleap Officevibe is the right tool for you, thanks to its user-friendly interface and effective surveys. However, it's not the strongest tool on our list in terms of performance management and reporting.
Key features of performance management software
Performance management tools can help you with many things, from tracking employee progress to providing feedback and creating plans for learning and development. Here are the key roles they play in different stages of the performance management process:
Goal setting and alignment
These types of tools provide frameworks for goal-setting and tracking, helping you transform your vision into measurable outcomes. They can be used for strategic planning as well as aligning individual goals with organizational objectives, which improves team alignment.
Performance review cycles
These help you automate and simplify the performance review process with customizable templates, structured questions, and the option to schedule performance reviews. Good performance review tools integrate with other HR systems making all employee data easy to find.
Continuous feedback
You can use these tools to collect real-time feedback and create a culture of improvement and open communication. Instant feedback allows you to address issues early on and prevent them from turning into bigger problems.
The tools can be used for collecting feedback between employees, managers, and peers. This multi-source approach, known as 360-degree feedback, is beneficial because it provides a well-rounded evaluation and reduces bias. If you want to implement it in your organization, check out our guide on 360 feedback for managers.
Engagement surveys
You can use performance management tools to create quick and simple engagement surveys and gather insights on employee satisfaction and motivation. Short pulse surveys give you valuable insights into your employee's challenges and desires as well as overall team performance.
Click here to discover Google Form templates and questions that you can start using right away.
Employee development
These tools help you spot skill gaps and create career development plans that consider both employee goals and aspirations and the company's objectives. Some of them provide employee skills assessment tests and personalized suggestions on areas for improvement.
Investing in employee learning and development not only boosts business performance but also positively impacts employee satisfaction and retention.
Click here to discover some of the best employee development plan examples to inspire you.
Analytics and reporting
Performance management software can analyze large volumes of performance evaluations and generate detailed reports on performance trends, engagement levels, and other productivity metrics.
They are able to spot patterns and correlations that might be missed by the human eye, saving HR managers time and helping them make informed decisions.
Why small businesses need performance management software?
It's a common misconception that performance and talent management tools are necessary only for large companies that have to manage a lot of employees and keep all their data in one place.
In fact, managing employee performance can often be more challenging for small businesses that may not have enough resources or time. Inconsistent evaluations and a lack of structured feedback can prevent small businesses from growing, and that oversight can hurt the overall business plan.
Performance management is often overseen by the COO or CEO, who may not have the time or expertise to focus on those things properly. But there's nothing to worry about as long as you have a good performance management system that acts as a guide and can make up for that.
If you don't have a dedicated HR team to work on your performance management strategy, your top priority when choosing performance management software should be ease of use. Look for a tool that's simple and allows you a quick implementation without any extra training.
Here are the key benefits:
- Saving time: It saves you a lot of time and reduces administrative burden by automating performance reviews and analysis.
- Improved accuracy: It minimizes dishonesty as it gives you evaluations based on the data.
- Engagement on the rise: It allows you to implement continuous feedback and improve communication frequency, improving employee engagement and satisfaction.
How we evaluated and chose the best performance management software for small businesses
Two-thirds of our evaluation was based on reviews from the past year on platforms like G2, Capterra, and Trustpilot, which assessed the software using the following criteria:
- Core features: While some tools focus only on performance management and performance reviews, others have additional features like goal-setting, time-tracking, pulse surveys, employee engagement, and recognition features.
- Ease of use: As a small business owner, it's improtant to pick a tool with a user-friendly interface that's easy to implement and use.
- Customization: Look for a tool that's flexible and allows you to customize performance reviews and reports.
- Analytics and reporting: You should pick a tool that has a powerful analytics which can generate detailed performance reports, making them clear and easy to interpret.
- Integration capabilities: Choosing the software that integrates with other tools and systems you are using should be kept in the loop.
We also reviewed release notes (where available) to analyze what new features these tools introduced over the past year.
The best performance management software for small businesses in 2025
After a lot of research and careful examination, here's our list of some of the best performance management software for small businesses.
Effy AI – easiest of use
Effy AI is a user-friendly AI-powered performance management software. The reason it's first on our list as it's one of the simplest and fastest performance review tools to get started with. You can start using it in minutes, thanks to its ready-to-use templates.
Pros:
- AI-Powered insights: Effy AI stands out for its advanced AI capabilities that analyze large volumes of employee reviews and provide you with deeper insights into employee performance and engagement. It has more robust analytics than most other tools available on the market while also being easy to use.
- Personalized feedback: It generates highly personalized feedback for employees based on real-time data. The built-in AI generates performance review summaries and development plans packed with actionable insights. This feature alone is a major advantage over traditional performance review tools, where you have to manually write and analyze reviews from scratch.
- Scalable for small businesses: While suitable for businesses of various sizes, Effy AI is a perfect performance management system for small businesses because it's super easy to set up and budget-friendly. Plus, you can create unlimited reviews for up to five employees completely for free! This makes it an appealing choice compared to more complex enterprise-focused solutions like Profit.co.
Cons:
- Limited user base (but growing rapidly): As a newer player in the market, Effy AI doesn't have as large a user base as some of the tools that have been around longer, but it's quickly gaining traction and winning over more users each day.
15Five
This performance management tool is based on the concept that employees should take no more than 15 minutes to write a report and managers should take five minutes to review it and it allows you to create quick surveys on a regular basis.
Pros:
- Continuous feedback: HR teams praise 15Five for its continuous feedback system, which promotes a culture of regular communication between managers and employees. This feature sets it apart from other tools like Workleap Officevibe which focuses more on engagement than on building a strong performance management system.
- Employee engagement tools: 15Five also has good employee engagement features, including pulse surveys and check-ins, which are highly rated compared to the more limited engagement features in tools like Profit.co.
- Goal management: You can easily track both short-term and long-term goals, or priorities and objectives, as 15Five calls them. The tool provides a more comprehensive way of aligning individual goals with organizational objectives, compared to software like Trakstar Perform or Workleap Officevibe.
Cons:
- Limited integrations: Though 15Five offers some third-party integrations, the number is far fewer compared to tools like Profit.co.
- Reporting limitations: Some users noted that 15Five’s reporting capabilities aren’t as robust as in platforms like PerformYard and Profit.co which offer deeper insights and the ability to create custom reports.
- No monthly plans: As of January 2025, 15Five costs $16 per user per month. However, monthly plans are not available, and the only option is annual payments.
PerformYard
This performance management and employee development software offers a variety of reviews, including competency-based reviews and goal check-ins.
Pros:
- Customizable reviews: PerformYard stands out for its ability to fully customize performance review templates, making it more flexible than many other performance management solutions like 15Five and Workleap Officevibe, which offer fewer customization options.
- User-friendly interface: An intuitive interface and ease of use represent a major advantage over more complex platforms like AssessTEAM. HR departments can easily adopt PerformYard even if they've never used performance review software before.
- Goal management: PerformYard provides excellent goal tracking and management features, with a focus on aligning individual and organizational goals. This is a key differentiator compared to some other tools like Workleap Officevibe that don't have goal management features.
Cons:
- Limited integrations: PerformYard doesn’t integrate as seamlessly with third-party tools as some of its competitors like Profit.co.
- Reporting limitations: Though good for basic reporting, PerformYard lacks the advanced analytics and customizable reporting that are available in Profit.co.
Profit.co
Profit.co is a task-management and performance-tracking software based on the OKR framework and focused on improving employee productivity by setting measurable goals.
Pros:
- OKR-based performance management: This tool is excellent for managing OKRs, which makes it a good choice for companies focused on goal-setting and outcome tracking. This feature is what makes it different from Trakstar or 15Five, which focuses more on performance reviews.
- Customizable reviews: It provides customizable performance review templates suitable for businesses with specific needs. This is a notable advantage over platforms like Workleap Officevibe or Trakstar, which stick to standard templates and don't offer the same level of customization.
- Comprehensive goal management: Its goal-setting framework that allows you to create OKRs in seconds with the help of AI is more advanced compared to tools like 15Five or Workleap Officevibe, which focus more on feedback and engagement than on goal tracking.
Cons:
- Complex integration setup: While Profit.co integrates with major platforms, some users mentioned that the integration process could be simplified.
- Reporting limitations: The reporting features are solid but lack the depth and customization that can be found in some other tools.
Trakstar Perform
Trakstar is a workforce management software solution that consists of multiple platforms for performance management, applicant tracking, learning, and workforce analytics, that can be purchased separately. In the context of this article, we'll focus on its employee performance management platform.
Pros:
- User-friendly interface: Trackstar has a simple interface, when compared to more complicated AssessTEAM.
- Effective feedback systems: Their feedback features are a breeze, and they offer a simple and quick way to give and receive feedback, which can increase the response rate.
- Strong customer support: Many users found Trakstar's customer service to respond fast and provide overall help with the platform.
Cons:
- Limited integrations: Trakstar Perform is missing a few integrations with popular HR and business tools when compared to PerformYard or 15Five. Therefore, you might need to purchase the entire Trakstar suite to get access to some of the essential tools for your HR department.
- Basic reporting: Trakstar’s reporting capabilities are limited compared to the more advanced and customizable reporting features available in tools like Profit.co and PerformYard.
AssessTEAM
AssessTEAM is a people management software that HR managers use to track employee performance with performance reviews, goal-setting, and time tracking.
Pros:
- Comprehensive performance management: AssessTEAM offers a complete suite of tools for performance management, including 360-degree feedback, performance reviews, competency-based evaluations, and goal tracking.
- Highly customizable reviews: It allows deep customization of performance reviews, making it much more flexible than platforms like Workleap Officevibe and 15Five, which stick to the standard templates.
- Goal Management: This is a good platform for goal setting and tracking as it allows you to effortlessly create both individual and team goals and add all the details you need.
Cons:
- Limited integrations: Similar to Trakstar, AssessTEAM struggles with third-party integrations, making it harder to sync with other business systems.
- Reporting limitations: Despite having extensive customization options when it comes to creating performance reviews, it falls short when it comes to reports, which are not only less customizable but also do not offer enough details for an in-depth analysis.
Workleap Officevibe
For businesses looking for employee experience management software that focuses on boosting engagement and providing recognition to high-performing employees, Workleap Officevibe might be the match.
Pros:
- Employee engagement focus: Workleap Officevibe is particularly strong in engagement and culture-building tools, such as pulse surveys, feedback mechanisms, and employee recognition, which distinguishes it from most tools on our list that focus more on performance management itself.
- Ease of use: The interface is simple and easy to use, which represents a key advantage over more complex platforms like AssessTEAM or Profit.co.
Cons:
- Limited performance management: Unlike other tools like 15Five or PerformYard, Workleap Officevibe lacks robust performance management and goal-tracking features, as it focuses mainly on engagement without a comprehensive view of employee performance.
- Basic reporting: The reporting capabilities are much more limited compared to other performance management software that offers advanced analytics and reporting for deeper insights.
How to implement performance management software in your small business
If you've never used performance management software before, here's how to get started:
- Set clear goals: Define what you want to achieve and choose the right metrics and KPIs to track progress.
- Customize the software: Customize the performance review templates and workflows so they align with your business processes.
- Train your employees: You should provide hands-on training and learning resources to ensure smooth adoption.
- Launch the tool: Create your first performance review cycle, run surveys, and ask employees to provide feedback.
- Analyze the data: When you gather performance data, the next step is to analyze it and convert it into actionable insights that will help you actually improve employee performance.
- Optimize and repeat: The goal is to create a continuous performance management system that you can optimize as you go and gather more insights.
Conclusion
As you can see, there are many different types of performance management tools. From those focused on performance reviews and goal setting to those that offer additional features such as engagement surveys and AI-powered insights.
If you're a small business owner looking for a user-friendly tool that's easy to implement and helps you automate your performance review process, Effy AI is the right choice for you.
Use our AI-powered insights to analyze large volumes of reviews and provide personalized feedback and action plans to all your employees without spending additional time.
