Performance Management in 2017

Companies Must Become Active and Responsive – interacting with everyone working in their company.

Today’s workers expect change. Constantly. And feedback. Specifically, they expect to have the ability to change their goals as business and their own needs change. They also expect to make changes using technology. And any technology solution should mirror the experience they have in their personal lives – it should be intuitive, responsive, relevant, and immediate.

Not only should any technology be up-to-date, it needs to provide immediate feedback.

For example, when you deposit a cheque using your banking app, it tells you immediately whether that transaction was successful. Same when you purchase something using your tablet.

The modern workforce wants that type of feedback about their performance because they have choices to make about their careers and they know it.

Regular performance feedback isn’t a Millennial thing. Every employee wants to know where they stand; what their future is; if you rate them and what for; what the niggles and opportunities and challenges are. Don’t wait until they have resigned to tell them you saw them as a future Director. It will ring hollow no matter how sincere.

Likewise any feedback does not and should not exclude contractors, consultants and other individuals working with the company.  Today’s workforce is flexible moving very between employment and self employment to suit them. Don’t miss out on interacting with everyone that is working for you.

Active Performance Management enhances the Modern Workplace

Any Active Performance Management solution should take the best of the traditional performance management process and combine it with the needs of today’s workforce. It provides a structure that managers and employees want so the process remains fair. It can also include the documentation aspect necessary to support job changes and promotions.

By making the process technology driven, it can take the traditional performance management one step further and facilitate real-time feedback conversations that employees want to move to the forefront. It can also utilise downtime.

Real-time feedback piece is so important to everyone that wants and values it. Waiting once a year (for a performance review) doesn’t work. It’s time to move to real-time system for performance, with frequent touch points between the manager/client and employee or worker.

5 Key Elements of Active Performance Management (APM)

2017 is the right time to introduce active performance management. There are four key elements to changing current performance management processes.

  • Regular performance conversations. Most organisations have some mechanism in place requiring managers and employees to meet once or twice a year. With active performance management, employees and managers meet more often. The timeliness of performance feedback helps the employee perform at a higher level.
  • Peer-based feedback. In addition to increased manager feedback, employees learn how to provide each other with performance feedback. This can be just as valuable – if not more so – than manager feedback. Employees collaborate with different colleagues every day and need positive working relationships with their peers.
  • Focus on current and future projects. More frequent performance conversations mean less time is spent rehashing old behaviour. Workers and managers already know what happened in the past. The conversations are spent on future performance, talking about how to accomplish goals.
  • Development at every level. Every worker becomes skilled in delivering performance-related feedback. This helps them take ownership of their career development.
  • Looking to the future – The elephant in the room is often that both sides know that to truly realise ambitions the individual may not stay in the same place until retirement. Working in a new way means such ambitions can be captured and companies can stay in touch with their future talent even if they aren’t currently working for them.

When you implement active performance management into an organisation you may wish to phase-in different key elements.

Phased implementations can be very successful and embed ways of working firmly. Performance Management facilitated by technology will allow the flexibility to introduce the entire process or each piece separately.

Active Performance Management Leads to Talent Activation

Organisations must create processes that result in having the best talent in the right positions. Those processes need to include creating an environment where all their workers (current, future and past) feel empowered to ask for and give feedback and that any training/development they need to be available in a timely manner.

When employees are engaged with their work, their performance improves and organisations begin to set the pace rather than react to the pace of the market.

We all understand the opportunity cost of not being agile in business. Think of companies like Uber, Airbnb, and the new Amazon app-based grocery stores. These companies shouldn’t have been able to disrupt the way that they did had “legacy” brands kept up with or innovated within their respective spaces. Increased agility enables organizations to increase the speed at which they conduct business and innovate, which improves the bottom-line.

 

Get rid of performance management… Here’s how

It’s not a very well kept secret that most HR professionals know that appraisal or performance management systems don’t work. But actually it is quite hard to push back when your boss is asking you to implement or manage or fine-tune one and it is still(ish) an accepted, respected even, business practice.

In my last job before I set my company up, the large government agency I worked for had invested in a highly complicated hungry system that required constant feeding and which I absolutely felt was a waste of time and energy for everyone. Public sector is always a tough environment to effect change as the Unions are highly suspicious of moving away from any system or process that doesn’t guarantee year on year pay rises, understandably. So often the temptation is to get into very detailed systems to manage Industrial Relations.

Thing was, as a senior HR leader I had to regularly defend this system when not only did I not believe in it for the organisation, I didn’t believe in it for me or my team. This coupled with the knowledge that if you wanted to see a really poor set of extremely non-SMART objectives you only had to go to the senior team or the HR department.

So fast forward 5 years and here I am running my own company and at last free to publically recommend the removal of appraisal systems to all my HR colleagues. Not only that but it’s starting to become a key area of focus for us as we help companies to move forward and think differently and have a good clear out of outdated ‘HR’ practices.

Here is how to go about it:

  1. To make a compelling recommendation to your Board, you need to know the cost and effectiveness of your current system. Set up a project team or get someone externally to do it for you. Don’t get sucked into the ‘we don’t have the budget’ argument. Every day you promote or prolong a system that you know doesn’t work and costs your company money, you are damaging your personal and professional brand.
  1. So now you have the research and know that not only do most people welcome the end to this process, it is costing an unbelievable amount of money for little obvious gain. If you asked a good set of questions, you will have picked up that employees still want development and progression at certain stages of their career, and at others to be left alone beyond the usual CPD. You may have picked up what your organisation sees as a possible way ahead – this might be nothing or a feedback loop or something that you haven’t worked out yet. Which is the exciting part.
  1. To pull your proposal together you need an alternative or a compelling reason for making the change. You will know what your organisations goals and ambitions are. Pull together a small project team and work with interested influential parties. Clearly you will still want to be able to reward those that work hard and are competent in their field so make sure you address that.
  1. You will find that most senior executives are of the opinion that one needs to legally have such a system. If you then get into consulting employment lawyers about it you will freeze in your tracks and probably agree to retain them to introduce more polices and procedures just in case….but… take a deep breath and ask yourself when was the last time that you actually managed an employee out via the capability route? And actually when was the last time a poorly performing employee had actually been told about it or marked down on their appraisal if indeed they had had one. And we all know that the real high fliers are too busy to appraise or be appraised. Especially in legal firms…
  1. You know that your organisation wants information on employees but that actually it is hard to come by. Even your appraisal process no matter how sophisticated won’t have really shone the torch in places that would excite your senior team. Think about how what you need to monitor and report on corporately. CPD is one area that should be critical for any professional firm to monitor but is often at best a tick box on an appraisal form or left to individuals to monitor. But there might be others. Think as broadly as possible. Don’t limit yourself to traditional areas – think of new ones. You might just identify something to focus on that will give your organisation competitive advantage.
  1. Recognise that doing something fairly radical like removing a long established system is changing the way your company works and interacts with employees (I’m not using the jaded old term engagement here because I don’t like it). The HR team will also want to create some space to look at the service it provides and how it adds value to the business and may consider letting go of other more traditional practices. This is an area worth investing in as it will up skill and inspire not only the HR team but the relationship with the business. Using an independent third party to facilitate and manage this can be key to a successful outcome.

I won’t wish you good luck at this stage as this is not about luck at all. This is about you as an HR professional and/or business leader critically evaluating an established system and making recommendation for change to help the organisation deliver its goals.

If this were the Finance or Marketing team with a similar issue ask yourself not only how they would approach it but how quickly they would make the change happen?

Enjoy.