Posts Tagged ‘performance management’

PERFORMANCE REVIEWS: KEEP OR KILL?

Saturday, July 2nd, 2016

time for review

Would you like to have something in common with companies like GE, Accenture, Microsoft, Deloitte and Adobe?  Would you like to be at the forefront of a movement, and do something that 10% of the Fortune 500 have done already?  Then consider eliminating Performance Reviews!

The case against Performance Reviews (PRs) includes stats from many recent surveys: 90% of Managers dislike PRs; 90% of HR professionals think PRs are inaccurate.  In a recent study of over 4400 Managers, variances in PR ratings were shown to be due to rater difference over 60% of the time, not differences in the person being rated!  This is known as “Idiosyncratic Rater Effect” – subjectivity and unpredictability from raters.

Think about your own experience with PRs.  Remember the last review you gave or received?  The odds are you were uncomfortable, anxious and annoyed, no matter which side of the review you were on.

PRs are notoriously inaccurate, but are often used for raises and promotions.  At the very least, subjectivity often trumps objectivity.  Even worse, Managers often have incentives to either inflate or deflate PRs, depending on their needs.  If a Manager’s own review depends on having a highly rated team, PR inflation could result, whereas if holding down departmental costs is important, deflation could occur, in order to save on raises.

The bottom line is that most recent studies show NO correlation between PRs and business results.  So why are most companies still hooked on PRs?  They don’t know any other way to monitor performance, establish criteria for raises and promotional paths, or to give meaningful feedback.

The companies who have eliminated traditional PRs have found another way.  All of these companies have found alternative ways for giving prompt, current feedback, evaluating performance, etc.  The new systems usually include a mechanism for more up-to-date feedback, feedback that is not only based on what is happening right now, but also based on things the employee can actually act upon immediately.  Traditional PRs on the other hand, usually give feedback on things that happened months ago, on which the employee can’t do better anymore.

Many new feedback systems incorporate frequent feedback interactions (often weekly), and some put the ball in the employee’s court.  Knowing that Managers are often swamped, they will have the employee prompt their manager for the weekly meeting, and make sure it happens.

The new systems focus on significant current incidents, and encourage praise as well as opportunities for corrective action while the incident is still happening.  New feedback systems focus on employee strengths, and recognize what else the employee can do to leverage strengths recently observed.  Consistent observation of employee strengths in action can lead to molding and shaping that person’s career based more on actions than traits.

Rather than focus on what the Manager thinks of an employee, the new evaluation systems focus on what the Manager would do with the employee.   At Deloitte, for example, Managers are asked “Would you want this person on your team?  Would you give this person a raise?”  These kinds of questions enable the Manager to act more in the interests of the company, increasing objectivity.

Prompt, current feedback could also be the best way to have the employee register kudos and praise, and ensures that subtle intangibles don’t get lost.  “I like the way you presented to that client; you handled yourself well in that meeting.”  These are not the kinds of things that get saved up and said in an annual review.

Regarding negatives, timely feedback enables the employee to actually act more productively in this incident, or at least on the next one, rather than letting a year of mistakes go by and then having the Manager seem punitive.

If you want to move towards prompt, current feedback, it is important to recognize the power of negatives on employees, and ensure that positive feedback is balancing any negatives.  Employees register negative feedback much more strongly, and sometimes it takes several positives to counteract a negative.

Many companies are implementing newer organizational tools (like Glint) that measure real time performance and increase employee engagement in more consistent systematic ways.

Performance Reviews haven’t yet died, but they are clearly undergoing a transformation, and many big companies are asking themselves what would be more effective.  Time to take a closer look at what works for you.

Talent, Passion and Ambition – The Keys to Performance Management

Monday, August 22nd, 2011

Getting the most out of your people will give you the edge in pulling out of the recession.  Most leaders agree that people are their company’s #1 asset.  Yet, HR leaders struggle to find the best metrics by which to achieve solid performance management.  Talent acquisition is usually done based on candidate competencies.  Specific job objectives are used to manage people once on board, and incentives are the most common motivational tool.  However, there are very valuable tools that can work even better for acquisition, management and motivation.

Talent: It is critical to evaluate talent in the context of how the talent is to be used. In past articles, we’ve discussed the pitfalls of behavioral or competency-based interviewing.  If employers manage people to objectives once they’re on board, it seems like common sense to hire based on those same objectives.  For example, instead of asking a person to describe their leadership experience in general, it is more valuable to get them to describe specifics:  “We need outstanding technical leadership skills to position us as cutting edge with our customers.  What have you done that would prepare you to achieve this goal for us?” By identifying the critical objectives of the job up front, then using those objectives to evaluate prospects, an employer can discover the candidate’s specific ability to perform and achieve the objectives.  Simply looking at behaviors or competencies in a vacuum (without defined objectives) is not useful.  We must understand talent by how it is to be deployed.

Passion: Passion is a powerful, compelling emotion.  If you ask most people “Do you love what you do?, they might chuckle and reply “I don’t even like what I do!”  Yet, how often do employers take this into account in managing people?  Do we discover the passions of our key people?  Do we tailor assignments to those passions?  Leveraging the collective passions of employees can turn a good organization into a great one.  Imagine the competitive advantage that could be gained in knowing what gets your employees revved up, aligning those strong feelings with your mission and purpose, and directing actions accordingly.  Would you even have to manage such people?  When an employer discovers how to capitalize on the core motivation of its people, it is indeed limitless.

Ambition: Ambition is the desire to reach an objective, and the willingness to strive towards that goal.  It is the next step beyond passion, because it has a direction.  Where do your people want to go, both individually and within your company?  Understanding what success looks like to each person enables you to tie jobs and rewards to real motivators.  Monetary incentives are important, but employers are often surprised to find out that other things besides money can produce strong results.  Sometimes it is small internal recognition, or horizontal expansion of responsibility; things that are simple for an employer to deliver.  Throwing money at people is easy, but more expensive, and sometimes not even that fruitful.  Discovering what they’re heading for personally, and providing a road map to align your goals with theirs can be highly productive.

Ensuring that you have the specific talent needed to achieve goals is critical in employee acquisition.  Channeling the passion and ambition of your people in productive directions and providing the non-monetary rewards they really want will help you get the results you want.  Then you can take your company to the next level.