2015 is the Year of Performance Management Reform

Are you considered an emerging Agile leader in your organization? If so, then you know that there's no "I" in Team - but what does that really mean when building and leading Teams to high levels of performance?

To foster the high performing Teamwork needed for business Agility, you need to be ready to take on one of the most difficult and radical of organizational changes - performance appraisal reform.

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The rumblings have been festering in big companies for a number of years now; rewarding the "I" in Team. This mindset, originally cultivated for rating the performance of factory workers, was once a centerpiece for organizations that relied on manual and repetitive work to create value in the market.

But as we're witnessing in recent times, organizations have already made an enormous shift into the world of knowledge work - the type of activity that is less repetitive and more creative in nature. To promote the best value out of this work, it's the collaborative effort of TEAMS that make this happen. Was the iPhone brought to market by a single person? Will Microsoft's CEO reinvent the organization by only rewarding the top individual performers?

Driving an individual-focused performance culture is all but gone in most small and thriving Agile organizations, but many of the largest enterprises are still deeply rooted in this concept. Why is this?

Consider watching this 3-minute humorous short, which dances around the dysfunctions with 'rating' systems like forced-ranking performance appraisals:

What do you think needs to change about this arcane system - anything?

Making the case for performance management reform

As a real Agile leader, you understand the importance of building and leading Teams, creating collaborative environments that foster innovation, and incorporating the focus and discipline needed to deliver high-quality value into the market more frequently. If you try to build Teams within a culture that emphasizes competitive behavior between employees, you will feel pain. Perhaps you're feeling this now?

Removing difficult and long-standing organizational issues takes time, but as an Agile leader, you must start somewhere. In a recent issue of CIO Journal, this succinct and useful case hits at the core of a forced-ranking system and the kinds of reform that leaders need to consider in the age of knowledge-work. If that's not enough, then latch on to this rallying cry to abolish performance reviews in 2015. Also, read about how Deloitte is reinventing its own performance management system to better fit with the modern business world. Need more? How about Accenture's move to finally absorb the years of evidence-based research to rid themselves of annual performance reviews.

As you'll see from these cases (and others that are emerging), 2015 is the year for every HR executive to become a student of the research.

If you really dig in, you'll discover a breathtaking difference between what the science says and what business does. But this is finally starting to change.

What took so long?

What does this mean to you as a leader?

I invite you, as the next great Agile leader, to understand what this really means and bring radical & responsible reform into your workplace. In order to do this, you must have the 'will' to change yourself, but also the 'skill' to educate and influence others to a fresh line of thinking. My advice is to immerse yourself in the long-standing research that proves why forced-ranking performance reform is an inappropriate practice for the modern knowledge workplace. Daniel Pink's D.R.I.V.E. is an excellent place to start, as it curates a compelling chunk of this research in a dynamic and conversational read.

It sounds simple on the surface, but this kind of reform is as complex as the markets you serve. And your own personal leadership transformation depends on it.

In Closing

Do you feel a professional purpose to make a change in your organization? What would it mean for you, the next great Agile leader, to abandon a forced-ranking performance appraisal system?

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As an organizational coach, trainer and speaker, Dan Sloan is on a professional mission to help transform and elevate large enterprises into collaborative and sustainable ecosystems that are creative, focused and fun for everyone.

Through LinkedIn and Twitter, Dan makes his best attempt to offer 25 years of learnings and experience through provocative writings about real organizations and their pursuits toward lasting enterprise agility.