What is wrong with many performance management processes and what does a good one look like?

The heat's on and the light is being shone brightly on employee performance.

It’s time to break the cycle of poor performance management processes. The world of work has changed dynamically since the pandemic in 2020. Our means of managing our people’s performance has not been so quick.

Traditional performance management

I’m not sure traditional performance management ever worked (imo). What do I mean by ‘traditional’? Bell curves, ratings, annual appraisals, highly detailed forms and competency frameworks…(I already want to faceplant on my keyboard just thinking about it!).?

The rigidity and lack of attention to the human aspects of performance, redacting people to a set of numbers on a sheet, has made performance management one of the most disliked and disruptive events a business performs across the year. Sad right! What a missed opportunity. More often than not, time invested doesn’t equal a positive ROI in sentiment or value, for anyone.?

Here are some statistics:?

• Nearly one third (32%) (of employees) would like performance enablement but don’t have it. (Betterwork)
• 46% of managers don’t feel confident coaching for career development. (Betterwork)
• Only 25% of employees have regular performance conversations with their managers (a min of 1 a month), 7% saying they happen weekly. (Clear Review)
• 45% of UK respondents said their performance management program meets the objective of driving organisational performance. (WTW)
• 32% of UK respondents said their performance management program meets the objective of career growth. (WTW)?

What’s broken??

Speaking to a number of people (employees, HR professionals, founders, managers) about this recently. Themes that came up were:?

• Too time consuming.?
• Lack of relevance to people's roles / work.?
• Processes rarely drive the right behaviours (competitive over collaborative, often fear inducing).?
• Ratings are demoralising, highly subjective and often feel unfair.?
• And after you have been through all that - no follow up afterwards.??

More often than not we take a siloed view of an individual, their output and correlate that directly to the company's performance. This highly binary perspective doesn’t take into account all the other messy things going on, that impact both an individual’s, team’s and organisation's performance. In this post Kenny Temowo shared a lovely visualisation of ‘nesting’ which shows the complexity of performance and all the things that play into it.?

Here’s the paradox. The process of performance management may inadvertently negatively impact performance.?

What does good performance management look like??

When done well it’s not all bad. In fact it’s pretty good. Fair and equitable performance management drives all the things a business wants and needs from their employees.?

When people feel a process is fair and equitable, productivity and engagement goes up.?

If employees are part of a culture that values their growth and has a system that supports it, the ROI will be tenfold.?

Good performance management is made up of a number of components done really well, in concert with each other. It’s definitely not a one off annual review or appraisal.?

It happens when the focus is on the growth and development of people and teams, in context to what they do. It takes some basic cultural habits and arguably you can have a high performing culture without even having a full blown process, by simply making sure the following is happening:?

1. Regular (high quality) feedback and one to ones.??
2. Clearly articulated mission, goals/objectives that cascade through an organisation, enabling alignment and direction.?
3. Authentic and genuine values, people will operate from the same place.?

Get these in place, the rest will kinda happen. Keeping it agile and simple is key.?

What are the enablers for high performance??

Time. Time to manage and time to learn.?

Creating time to set direction, manage and lead is paramount. Without this a performance management system would feel very unfair and highly subjective.

Time to learn is also critical. Organisations are very good at talking a good game about continuous learning and development, but often the time allowed for people to invest in learning and doing something other than BAU, is frequently deprioritised in favour of deadlines.?

People. Creating a team and culture that lift each other up, is where you see the magic happen.?

Leadership. You need leaders and managers who love enabling those around them, through empowerment and good feedback. Psychological safety plays an important role.??

Culture. Your culture will drive the type of performance you see in your organisation.?

Simplicity. The more complicated, the more time consuming it becomes and harder to engage with.

Who does it well??

There are a number of organisations who have abandoned the traditional approach and with notable success. Here’s a couple of examples:?

Microsoft embarked on a highly flexible approach, with employees keeping performance journals and a focus on goal setting.?

Asana emphasises continuous feedback and transparency, invests in coaching, and also reviews departments, not just the individual. Twice a year they create space and time for a Road Map week, which encompasses appraisals. Performance here is holistic.

Takeaways

No one size fits all. However you choose to manage your employees performance, it needs to reflect the culture of your organisation. A holistic approach, driven by continuous feedback and support will do more for an organisation than a spreadsheet full of numbers. Favouring lightness and simplicity will drive engagement and people can focus on what matters, high quality conversations and interactions.?

I’d like to thank everyone who gave up their time to chew this over recently Clare Mulcahy Louise Caskey Marc Earnshaw Kenny T. ?

…………………………………………

I’m Candy, a Fractional People Lead and Consultant. If you want to talk about how I can help you build a high performing team and culture, drop me a DM or book in an intro call .?

Resources

https://www.betterworks.com/state-of-enablement-report-2023-digital/

https://www.clearreview.com/performance-management-report-2023/

https://www.wtwco.com/en-gb/insights/2023/02/reshaping-performance-management-and-pay-for-performance-in-a-challenging-environment

https://www.wtwco.com/en-gb/news/2022/12/employers-are-reshaping-performance-management-and-pay-programs