performance management

It won’t come as a surprise to you that I’m a big advocate for the power of technology in performance management. At Cognology, we see the business impact of great performance management technology almost every day.

But in this article, I wanted to go a step further and understand if there’s broader scientific support for the power of performance management technology. As you’ll see, there’s a range of strong research demonstrating how technology continues to fundamentally change performance management.

In preparation for this article our team spent many hours trawling academic journals on performance management. The aim was to find well-cited academic papers that specifically looked at technology in the performance management space.

I’ve arranged the research findings under four headings:

How technology impacts the performance management approach
How technology impacts the overall effectiveness of performance management
How technology impacts performance management for remote workforces
How performance management technology impacts business-critical strategy

Without further introduction, let’s jump into the research:

How technology impacts the performance management approach: Validated findings

1. Technology drives more positive attitudes about performance reviews.
Gueutal, H., & Stone, D. L. (2003). The brave new world of e-HR.
Advances in human Performance and Cognitive Engineering Research, 3, 13-36.

2. Technology-enabled performance management tools encourage managers to develop better ongoing performance management behaviours.
Hunt, S. T. (2011). Technology is transforming the nature of performance management.
Industrial and Organizational Psychology, 4(02), 188-189.

How technology impacts the overall effectiveness of performance management: Validated findings

3. Technology increases the effectiveness of performance feedback.
Gueutal, H., & Stone, D. L. (2003). The brave new world of e-HR.
Advances in human Performance and Cognitive Engineering Research, 3, 13-36.

4. Basing performance management around projects rather than time of year highlights the optimal time for reviewing performance.
Gueutal, H., & Stone, D. L. (2003). The brave new world of e-HR.
Advances in human Performance and Cognitive Engineering Research, 3, 13-36.

5. Data from performance management technology is critical in identifying and tracking high-potential employees.
Stone, D. L., & Stone-Romero, E. F. (2003). and Kimberly Lukaszewski.
Advances in human performance and cognitive engineering research, 3, 37-68.

6. Developmental opportunities and potential mentoring relationships are more easily discovered through performance management data.
Stone, D. L., & Stone-Romero, E. F. (2003). and Kimberly Lukaszewski.
Advances in human performance and cognitive engineering research, 3, 37-68.

7. To effectively manage performance employees must be involved in goal setting, using technology.
Kagaari, J. R., Munene, J. C., & Mpeera Ntayi, J. (2010). Performance management practices, information and communication technology (ICT) adoption and managed performance.
Quality Assurance in Education, 18(2), 106-125.

How technology impacts performance management for remote workforces: Validated findings

8. Technological tools can be particularly helpful to complete the performance planning process when manager and employee do not work out of the same location.
MCI World Com, 2001, as cited in Joshi, S. K. (2014). Role of Technology in Performance Management System: A Literature Review.
Available at SSRN 2515225.

9. The essential components of defining, facilitating, and encouraging performance are even more critical in a virtual work environment than in a traditional one.
Cascio, W. F. (2003). How technology facilitates virtual work arrangements. In E. Salas & D. Stone (Eds.),
Advances in human performance and cognitiveengineering research (Vol. 3, pp. 1–12). Oxford, UK: Elsevier Science.

10. The importance of developing clear, objective goals is promoted in the absence of frequent face-to-face communication between the subordinate and supervisor.

Manoochehri, G., & Pinkerton, T. (2003). Managing telecommuters: Opportunities and challenges. American Business Review, 21, 9–16.
Ellison, N. B. (1999). Social impacts: New perspectives on telework. Social Science Computer Review, 17, 338–356.
Illegems, V., & Verbeke, A. (2004). Telework: what does it mean for management?. Long Range Planning, 37(4), 319-334.

How technology impacts business-critical strategy: Validated findings

11. Instead of spending time asking people to “please fill out their talent forms”, HR uses data generated from cloud technology to gain insights that drive strategic discussions.
Hunt, S. T. (2011). Technology is transforming the nature of performance management. Industrial and Organizational Psychology, 4(02), 188-189.

12. Digitalisation of performance management not only provides better data, but also “positively influences management processes and strategic development”.
Tambo, T., & Gabel, O. D. Discussing performance management architecture in public service broadcasting. In PMA (Performance Management Association) conference 2014.

13. Performance management technology is critical not just as a business intelligence system, but also as an analytical online process, a data warehouse and a simulation tool.

Ballard, C., White, C., McDonald, S., Mylymaki, J., McDowell, S., Goerlich, O., & Neroda, A. (2005). Business Performance Management: Meets Business Intelligence. IBM.
Tambo, T., Gabel, O. D., Olsen, M., & Bækgård, L. (2012). Organisational Dynamics and Ambiguity of Business Intelligence in Context of Enterprise Information Systems–a case study. CONFENIS, 1-16.
Smith, M. A., & Kavanagh, S. C. (2008). The Potholes of Performance Management Technology: A New Road and Its Obstacles. Government Finance Review, 24(3), 63-66.

In conclusion

This research clearly shows that better technology is making performance management a part of everyday work life. As I’ve spoken about previously, this is a huge step in the right direction towards more natural, agile performance management.

It’s evident that the widely known benefits of performance management technology (such as the efficiency, accessibility and relevancy of performance management) are only the tip of the iceberg.

It’s also great that the impact of performance management data on high-level strategy is becoming more defined (and attracting a lot of attention). This is good news in making sure all businesses recognise the significant benefits of best practice performance management technology at the highest levels of leadership.

I’m planning to keep this ultimate guide up-to-date over time. So if you see any more well-cited research on the power of technology in performance management, please let me know via twitter @Cognology.

Jon Windust is the CEO at Cognology – Talent management software for the future of work. Over 250 Australian businesses use Cognology to power cutting-edge talent strategy. You can follow Jon on Twitter or LinkedIn.

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On 5 March 2015, the Australian Government released the latest, much-anticipated Intergenerational Report. The report predicts changes to Australia’s population over the next 40 years, making it an incredibly useful tool for building workplace systems that are fit for the future.

The data attracting the most attention in the report is focused on Australia’s ageing workforce. This got me thinking about the impact an older workforce will have on performance management.

We know that workplaces of the future will be highly collaborative and fast-moving. We also know that for people to develop quickly enough to keep up, we need a more ‘agile’ approach to performance management. My question is, does an older workforce support this need for Agile Performance Management?’

Agile performance management guide

A quick introduction to the Intergenerational Report

At least every five years the Government produces an Intergenerational Report to test the long-term sustainability of current policies. For Australian businesses, it’s a welcome opportunity to prepare for the future.

The report specifically looks at changes to Australia’s workforce size and age profile. The HR world can use this data to predict challenges (and opportunities) in work participation and productivity levels.

What will the Australian workforce look like in 2055?

The Australian Workforce in 2055 chart

The Intergenerational Report confirms that in 2055 Australia’s workforce will have many older workers than today (the key statistics are included in the graphic above).

As a proportion of Australia’s population, in the future there will be fewer people of traditional working age. (Relative to 1975 there will be 4.6 less working-age people to support each person over the age of 65.)

As a result, the report anticipates a 34% increase in the number of people staying in work beyond the age of 65. Put another way, by 2055 nearly one in five members of the Australian workforce will be aged over 65.

Why an older workforce makes Agile Performance Management even more critical

The report expects that the decrease in the number of available workers will be solved by older generations working for longer

We knew the population was ageing, but this data predicts a much bigger change than many of us would have expected. As a result, it’s critical that our workplaces are future-ready for a changing workforce.

The report expects that the decrease in the number of available workers will be solved by older generations working for longer. If this turns out to be correct, then Agile Performance Management will be crucial. Here’s why:

Regular check-ins
As we become more experienced, and grow older, it’s natural that we may not find enjoyment in the same things or be interested in doing the same kind of tasks. Regular check-ins between workers and managers will highlight these changes before they become problematic. As a result, workflow and task allocation can be changed accordingly. Excellent talent management is all about having the right person doing the right job at the right time.
Capability development
Being open to and acquiring new skills is crucial for older workers for two reasons:
- The rate of technological change means that everyone needs to continually learn new skills to perform their jobs effectively. Younger generations tend to be naturally faster at picking up new skills, so developing the tech-based capabilities of older workers should be a priority to ensure their relevance in the workplace.
- Roles are set to become broader as work becomes more collaborative. Older workers may need to develop new capabilities to make the most of this dynamic environment.
Coaching and mentoring
The experience of more mature workers is an excellent asset for any company. There’s a significant opportunity to utilise mature workers in coaching and mentoring roles to improve the knowledge and expertise of less experienced employees. Coaching doesn’t need to go in just one direction either (for example, younger workers could also coach older workers on technological skills).
Frequent feedback
Older workers may, or may not, be motivated to climb the corporate ladder, but that doesn’t mean they don’t need feedback. Regular feedback isn’t just for long-term development: it also has a major role in improving performance day-to-day. Regular feedback has also been proven to increase engagement, decrease stress levels, improve workplace relationships and optimise efficiency. (All of which translates to higher levels of job satisfaction and healthier, happier employees).

In conclusion

Our workforce is ageing. As a result, over coming decades there will be more people aged 65+ remaining in the workforce than ever before. It’s our job now to make sure these workers stay engaged, productive and happy at work. The fundamentals of Agile Performance Management (including ongoing feedback and mentoring) will be essential in ensuring older workers continue to contribute meaningfully, and at their highest level of performance.

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Imagine joining Netflix before anyone knew what it was. You received a job description before starting. On day 1 your boss gets you started on your key responsibilities. Whether your role is to sign movie licensing deals, develop their software or provide customer service, as often happens for a large majority of people, your sense of engagement will likely start strong and then wane in the months following the honeymoon period.

But now imagine what would happen if before you even started, you knew the purpose for Netflix and how you fit in. You knew they wanted to create the worlds most popular movie and TV streaming service. They wanted to give people access to the shows they loved on-demand, a completely new idea.

The people you worked with continually talked about this picture of the future. How much more engaging and motivating would it be? You’d have a purpose beyond your end of week pay packet. As Hubspot’s culture code puts it: “paychecks matter but purpose matters more.”

Individual performance (and subsequently overall business performance) dramatically improves when employees know why they are doing their job. It’s further enhanced when people know how their job impacts or contributes to the goals of the business overall.

The key benefits of a sense of purpose

Maintain a sense of purpose at all levels in your organisation – linking everyone’s job to the bigger picture – and your business will reap the rewards:

Significantly higher engagement – which lowers absenteeism and turnover and increases productivity
A faster business – with everyone pulling in the same direction you can achieve your goals more quickly
A more innovative business – having a clear direction promotes more creativity

Well-executed performance management clearly defines the link between an employee’s job and the objectives of the business – day in, day out. Here’s how:

1. Clearly articulate company goals to everyone

Sharing your company’s goals is the starting point for both purpose-driven employees and great performance management.

Creating a sense of purpose at an individual level starts with the leadership team asking “why do we do what we do?” – then clearly communicating the answer to the business. In his 2010 TED talk, Simon Sinek makes a terrifically powerful appeal to leaders (it’s worth watching):

“It’s those who start with “why” that have the ability to inspire those around them.”

Transparent company goals that are communicated clearly and often lay the foundations for a workforce driven by a shared purpose. They are also the bedrock for effective performance management.

At its core, great performance management ensures that employees are aligned with the business as it moves forward. It has the power to ensure the right people are in the right roles, doing the right tasks and developing their skills in line with business needs.

Of course, in order to do this job effectively, performance management relies on every employee understanding the fundamental goals of the business.

2. Align employee goals with business goals

Give your employees purpose by clearly explaining exactly how their job affects the success of the business. A crucial step in the implementation of a great performance management system is giving goals this context.

The SMART approach is a best-practice method for setting goals (specific, measurable, attainable, relevant and time-bound). The ‘R for relevant’ is the key here – make sure all goals are clearly relevant to the business’s purpose.

For example, using the idea in our introduction, if you were setting a goal for a HR executive, an aligned and purposeful objective would be to “Contribute to successful commencement of services in Australia by establishing a leadership team by January 2015 with proven past successes building operations from the ground up”

At Netflix, giving employees context is ingrained behaviour. The Netflix culture code captures this by saying: “High performance people will do better work if they understand the context.”

But it’s not just Netflix that says so – research backs up the statement strongly. If you’re interested to read more on this, I can suggest two papers from the Center of Advanced Human Resource Studies: ‘Seeing Clearly’ from this collection of white papers and ‘Employee line of sight to the organisation’s strategic objectives – what it is, how it can be enhanced and what it makes happen’.

3. Use performance management to maintain a sense of purpose when things change

Business objectives, and subsequently business strategies, can change in a heartbeat – especially in fast-moving, innovative organisations, or those facing fierce competition, regulatory upheaval and so on. Change can mean that job roles quickly become misaligned with the new direction of the business. To keep your employees on the right track and adding value despite shifting sands, ongoing feedback and coaching is crucial.

The effect of coaching on purpose and engagement hasn’t gone unnoticed at Wells Fargo. A top executive announced last year that he expects bank managers to spend two thirds of their time coaching their staff.

Ongoing feedback and coaching are key elements of best-practice performance management. Providing plenty of contact time between employees and their managers/mentors, regular feedback means new strategies can be quickly implemented on the ground.

Done well, every coaching and feedback session will leave your employees feeling that achieving their individual goals are directly connected to the success of the business.

In conclusion

A sense of purpose lies at the very heart of driving employee engagement and better business performance.

Great results happen when every employee is connected to purpose, every day. Best-practice performance management makes this straightforward.

With clear goals, feedback and coaching, your employees will have a direct and tangible connection to the success of your organisation.

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Cognology data shows:

Performance management in 2015 is more forward looking, with nearly 2x the focus on future career planning
The amount of feedback has significantly increased. The average individual can expect nine feedback events each year (up over 3x since 2011)
An increased employee development focus over the past five years, with individual L&D events per employee nearly doubling
Managers are more frequently tracking performance. On a per employee basis, there were 108% more performance outcomes recorded in 2014 (compared to 2010)

Performance management continues to evolve rapidly. Sometimes when there’s so much change happening so quickly, it’s easy to lose track of just how far things have moved. So this week, I’m taking the opportunity to dive into our anonymised Cognology product data to examine just how much performance management has changed over the past five years.

Looking at this data from a number of perspectives, I think there’s four interesting trends worth exploring:

1. Performance management is increasingly forward looking

Over the period from 2010-2014, the focus on employee career planning has nearly doubled. The data shows that the average employee is now adding four progression points into their career plan each year. Each addition defines things that an individual needs to do to take the next step in their career.

As we see this number rise, it’s a sign that both managers and employees are more focused on performance management as a forward-looking activity. This is a very different style of performance management conversation. It’s all about the gap between where you are today and where you need to be tomorrow (rather than just focusing on your performance in the past period).

2. The amount of feedback has significantly increased

The amount of feedback that employees can expect to receive each year has also significantly increased. For the average employee, the number of annual feedback events has risen from just under three in 2011 to nearly nine in 2014. That’s an increase of over 3x in four years! Spreading this feedback out across the year, this increase means that employees received feedback roughly every six weeks in 2014 (compared to once every four months in 2011).

The power of frequent feedback is something I believe in passionately (and have talked about on many occasions, see here and here for two good examples).

This dramatic increase in the amount of feedback received is a fantastic sign (but I’d still argue that once every six weeks isn’t quite enough for most employees). In any case, we’re certainly heading in the right direction.

3. There’s more focus on individual development

Over the past five years we’ve seen individual level L&D events nearly double. These events record things like individual training, learning, coaching and mentoring.

Despite the current cost environment, we’re seeing more individual development happen now than ever before. It’s a great sign that executives clearly understand the ROI of a well-structured L&D program.

4. Managers are more frequently tracking performance

The data also shows that we’re seeing much more frequent tracking of individual performance. In 2014, the average employee had 19.9 performance “results” recorded over the course of the year (up from 9.6 to five years earlier). In our performance management language, a “result” means that an outcome has been recorded against a performance goal. In English, this means that managers are tracking performance against goals and objectives at a much more frequent (and detailed) level.

I know many people would argue this increased accountability is being driven by the current cost environment. My view is that this increase is also tied to the dramatic increase in the amount of feedback, with managers looking to inform better coaching and development planning. Fundamentally, it’s not possible to increase the amount of feedback by 3x without significantly more data!

The market is naturally evolving towards a more agile performance management

If you’re a regular reader of this blog, you’ll be familiar with my views on Agile Performance Management (performance management focused on highly frequent feedback and forward looking development). As the data here shows, it’s great to see that the market is naturally evolving towards a more agile version of performance management.

I think it’s also powerful to absorb the fact that this performance management evolution is happening in a cost-conscious market. It reinforces that businesses aren’t making these changes because they’re a ‘nice to have’. They’re moving to more frequent, forward-looking performance management because they can see the hard economic logic. Better performance management makes more money. And that’s an easy business case for all of us to get behind.

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Great feedback is a critical element of best-practice performance management. This week, I’m sharing some of my favourite quotes on feedback – from Winston Churchill to Elon Musk, there’s some powerful thinking here on the how and why of giving better feedback.

At Cognology, as we design our product suite that allows hundreds of thousands of employees to give and receive feedback more effectively, these quotes inspire me every day.

They’re also great to read before giving feedback to your team (you’ll always find some advice appropriate to the situation you’re facing).

Have you got a favourite quote on feedback that I’ve missed? Let me know in the comments below – I’ll make sure it’s included.

49 quotes on the power of feedback

1. “We all need people who will give us feedback. That’s how we improve.”
– Bill Gates

2. “Criticism, like rain, should be gentle enough to nourish a man’s growth without destroying his roots.”
– Frank A. Clark

3. “Feedback is the breakfast of champions.”
– Ken Blanchard

4. “Feedback is a gift. Ideas are the currency of our next success. Let
people see you value both feedback and ideas.”
– Jim Trinka and Les Wallace

5. “Mistakes should be examined, learned from, and discarded; not dwelled upon and stored.”
– Tim Fargo

6. “What is the shortest word in the English language that contains the letters: abcdef? Answer: feedback. Don’t forget that feedback is one of the essential elements of good communication.”
– Anonymous

7. “There is no failure. Only feedback.”
– Robert Allen

8. “Make feedback normal. Not a performance review.”
– Ed Batista

9. “No matter how good you think you are as a leader, my goodness, the people around you will have all kinds of ideas for how you can get better. So for me, the most fundamental thing about leadership is to have the humility to continue to get feedback and to try to get better – because your job is to try to help everybody else get better.”
– Jim Yong Kim

10. “True intuitive expertise is learned from prolonged experience with good feedback on mistakes.”
– Daniel Kahneman

11. “I think it’s very important to have a feedback loop, where you’re constantly thinking about what you’ve done and how you could be doing it better.”
– Elon Musk

12. “The single biggest problem in communication is the illusion that it has taken place.”
– George Bernard Shaw

13. “Examine what is said and not who speaks.”
– African proverb

14. “Employees who report receiving recognition and praise within the last seven days show increased productivity, get higher scores from customers, and have better safety records. They’re just more engaged at work.”
– Tom Rath

15. “There are two things people want more than sex and money… recognition and praise.”
– Mary Kay Ash

16. “Criticism may not be agreeable, but it is necessary. It fulfils the same function as pain in the human body. It calls attention to an unhealthy state of things.”
– Winston Churchill

17. “To avoid criticism, do nothing, say nothing, and be nothing.”
– Elbert Hubbard

18. “Words are singularly the most powerful force available to humanity. We can choose to use this force constructively with words of encouragement, or destructively using words of despair. Words have energy and power with the ability to help, to heal, to hinder, to hurt, to harm, to humiliate and to humble.”
– Yehuda Berg

19. “To effectively communicate, we must realize that we are all different in the way we perceive the world and use this understanding as a guide to our communication with others.”
– Tony Robbins

20. “Communication – the human connection – is the key to personal and career success.”
– Paul J. Meyer

21. “Whatever words we utter should be chosen with care for people will hear them and be influenced by them for good or ill.”
– Buddha

22. “Take advantage of every opportunity to practice your communication skills so that when important occasions arise, you will have the gift, the style, the sharpness, the clarity, and the emotions to affect other people.”
– Jim Rohn

23. “If you have an important point to make, don’t try to be subtle or clever. Use a pile driver. Hit the point once. Then come back and hit it again. Then hit it a third time – a tremendous whack.”
– Winston Churchill

24. “The two words ‘information’ and ‘communication’ are often used interchangeably, but they signify quite different things. Information is giving out; communication is getting through.”
– Sydney J. Harris

25. “Communication is a skill that you can learn. It’s like riding a bicycle or typing. If you’re willing to work at it, you can rapidly improve the quality of every part of your life.”
– Brian Tracy

26. “I’m a great believer that any tool that enhances communication has profound effects in terms of how people can learn from each other, and how they can achieve the kind of freedoms that they’re interested in.”
– Bill Gates

27. “Why did God give me two ears and one mouth? So that I will hear more and talk less.”
– Leo Rosten

28. “Listening, not imitation, may be the sincerest form of flattery.”
– Joyce Brothers

29. “If your actions inspire others to dream more, learn more, do more and become more, you are a leader.”
– John Quincy Adams

30. “Unlike a drop of water which loses its identity when it joins the ocean, man does not lose his being in the society in which he lives. Man’s life is independent. He is born not for the development of the society alone, but for the development of his self.”
– B. R. Ambedkar

31. “All that is valuable in human society depends upon the opportunity for development accorded the individual.”
– Albert Einstein

32. “Ever since I was a child I have had this instinctive urge for expansion and growth. To me, the function and duty of a quality human being is the sincere and honest development of one’s potential.”
– Bruce Lee

33. “The growth and development of people is the highest calling of leadership.”
– Harvey S. Firestone

34. “Constant development is the law of life, and a man who always tries to maintain his dogmas in order to appear consistent drives himself into a false position.”
– Mahatma Gandhi

35. “Strive for continuous improvement, instead of perfection.”
– Kim Collins

36. “Excellent firms don’t believe in excellence – only in constant improvement and constant change.”
– Tom Peters

37. “Never be afraid to fail. Failure is only a stepping stone to improvement. Never be overconfident because that will block your improvement.”
– Tony Jaa

38. “He who busies himself with things other than improvement of his own self becomes perplexed in darkness and entangled in ruin. His evil spirits immerse him deep in vices and make his bad actions seem handsome.”
– Ali ibn Abi Talib

39. “The improvement of understanding is for two ends: first, our own increase of knowledge; secondly, to enable us to deliver that knowledge to others.”
– John Locke

40. “There is always space for improvement, no matter how long you’ve been in the business.”
– Oscar De La Hoya

41. “Improvement begins with I.”
– Arnold H. Glasow

42. “The pursuit of perfection often impedes improvement.”
– George Will

43. “To acquire knowledge, one must study; but to acquire wisdom, one must observe.”
– Marilyn vos Savant

44. “If you have knowledge, let others light their candles in it.”
– Margaret Fuller

45. “It is beyond a doubt that all our knowledge begins with experience.”
– Immanuel Kant

46. “Knowledge rests not upon truth alone, but upon error also.”
– Carl Jung

47. “To become more effective and fulfilled at work, people need a keen understanding of their impact on others and the extent to which they’re achieving their goals in their working relationships. Direct feedback is the most efficient way for them to gather this information and learn from it.”
– Ed Batista

48. “In a growth mindset, challenges are exciting rather than threatening. So rather than thinking, oh, I’m going to reveal my weaknesses, you say, wow, here’s a chance to grow.”
– Carol Dweck

49. “We can’t just sit back and wait for feedback to be offered, particularly when we’re in a leadership role. If we want feedback to take root in the culture, we need to explicitly ask for it.”
– Ed Batista

Image Credits:

Bill Gates World Economic Forum Annual Meeting New York 2002 CC BY-SA 2.0, via Wikimedia Commons
Elon Musk – The Summit 2013 By Heisenberg Media (Flickr: Elon Musk – The Summit 2013) [CC BY 2.0], via Wikimedia Commons
Tony Robbins The Twitter Conference – Tony Robbins by Brian Solis, on Flickr
Bruce Lee By Kharlozz2013 (Own work) CC BY-SA 3.0, via Wikimedia Commons

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I love a good TED talk – you get so much insight in so little time. The best TED talks compress an entire book into the space of 20 minutes. But it’s not just the amount of insight that’s impressive – it’s also the clarity of communication. You need no specialist experience to understand what are often complicated ideas and research.

For all these reasons I think TED talks are a great way to learn about new ideas in performance management. For this article I’ve been through some of my favourite TED talks and selected the ten that I think feature the most interesting thinking driving performance management today.

You’ll see that below each talk I’ve given you a couple of quick notes on the key takeaways for better performance management.

I’d love to hear what you took away from these ten talks – let me know in the comments below or via Twitter (tweet me @cognology).

1. Shawn Achor: The happy secret to better work

As Achor describes: “Your brain at positive performs significantly better than at negative, neutral or stressed. Your intelligence rises, your creativity rises, your energy levels rise. In fact, we’ve found that every single business outcome improves.”

Great performance management encourages positivity throughout the organisation. As I talk about here, best-practice performance management is forward looking and focuses on positive reinforcement, goals, recognition and autonomy.

2. Dan Pink: The puzzle of motivation

In this talk, Pink describes a number of experiments that have found incentives actually lead to lower performance (the larger the reward, the poorer the performance).

If we really want high performance in our organisations, the solution isn’t to entice people with a bigger carrot, or threaten them with a longer stick. We need to understand intrinsic motivation.

Best-practice performance management targets each of the three elements required for intrinsic motivation:

Autonomy is delivered by giving people goals and the freedom to reach them in their own way
Mastery is driven by providing feedback and coaching, which helps people build their competency and skills
Purpose is created by giving people transparency to business objectives through feedback and regular check-ins (and ensuring all goals are aligned with those objectives)

3. Dan Ariely: What makes us feel good about our work

In this powerful talk, Ariely describes two experiments that show challenge and recognition are more effective motivators than money.

Done well, performance management is the most effective tool for leaders to set challenges and deliver recognition – using tools like goals, feedback and coaching.

4. Julian Treasure: How to speak so that people want to listen

Treasure starts this talk by looking at the 7 deadly sins of speaking – then quickly turns to improving both what you say and how you say it:

What’ looks at the ‘HAIL’ approach: honesty, authenticity, integrity and love
‘How’ looks at controlling your voice – register, timbre and prosody

At the core of effective performance management is successful communication. To deliver feedback that will be taken on board it’s critical that you speak so that people around you want to listen.

5. Simon Sinek: Why good leaders make you feel safe

Sinek makes the argument that being a great leader is like being a parent. He argues that you need to provide your people with opportunity, education, discipline, self-confidence, and the opportunity to try and fail.

When people feel safe and protected by the leadership in the organisation, their natural reaction is to trust and cooperate (driving higher performance).

6. Drew Dudley: Everyday leadership

Dudley explains that leadership doesn’t have to be extraordinary, it’s simply the everyday act of improving each other’s lives.

At heart, this is the purpose of performance management – to improve each other’s day-to-day experience at work.

This talk is a simple reminder that performance management doesn’t have to be top-down process. Fundamentally, great performance management can be as simple as a quick tip from a colleague (and a thankyou in reciprocation).

7. Margaret Heffernan: Dare to disagree

A great talk on why disagreement is critical for optimal business performance. As Heffernan describes, most people tend to avoid conflict, but for a number of reasons the best business partners allow each other to disagree (often deeply).

Best-practice performance management opens channels of communication and gives all parties the freedom to disagree with each other (in a fact based environment).

8. Matt Cutts: Try something new for 30 days

This talk suggests a fantastic way for leaders to start integrating parts of agile performance management into their workplace. As Cutts describes, 30 days is about the right amount of time to add or subtract a habit.

For example, to encourage a culture of feedback a leader might ask her team to deliver the following feedback every week to different people:

4 pieces of positive feedback, and
1 piece of constructive feedback.

It’s an easy and natural way to move towards a more open and agile culture of performance management.

9. Laura Trice: Remember to say thank you

In this quick talk, Trice looks at the importance of praise, admiration and saying thank you. Importantly, she focuses on the importance of asking for praise if you need it. Trice also reinforces why praise (or ‘positive feedback’) must be specific and genuine

This is a quick and powerful reminder that performance management isn’t just up to the ‘boss’ – employees (and leaders) shouldn’t be afraid to ask for feedback.

10. Richard St. John: Success is a continuous journey

According to St. John, success is really the final stage in a 9-step cycle:

Passion
Work
Focus
Push
Ideas
Improve
Serve
Persist
Success

In the same way, best practice performance management is a continual process – focused on growth of the individual (not just the review cycle).

It’s easy to apply each element of a best practice performance approach to St. John’s cycle of success, for example:

Passion: Through regular check-ins make sure that your employees are working on things they’re passionate about
Focus: Through clearly defined goals
Improve: Through feedback, coaching and mentoring

The post 10 TED talks on best-practice performance management appeared first on Cognology.

Performance management is fundamentally a challenge of learning: How can we make sure employees learn from their successes and failures over time to improve their performance?

This is why I was fascinated to watch the inaugural Australian Learning Lecture, delivered by Sir Michael Barber. Barber is a British educationist who has served as head of the global education practice at McKinsey and advisor to Prime Minister Tony Blair.

Barber’s lecture focuses on the idea that more measurement leads to both better outcomes and a happier, more successful learning environment. There’s a lot of powerful thinking here that all of us involved in the space of performance management can learn from.

You can watch the lecture below (or jump down for my key takeaways on better performance management).

I took away four points that are highly relevant to how we approach performance management:

One: Measurement is suffering from an image problem

Barber makes the strong argument that “we need to reclaim data as an ally in improving the human condition…In the modern world, Joy and Data are often seen as opposites; the one creative, spontaneous, warm, and spiritual; the other, scientific, bureaucratic, cold and analytical.”

Performance management take-away: Like in education, badly designed and executed performance measurement processes (i.e. rank and yank) have left some with a bad taste in their mouth.

But done well, performance measurement is an empowering conversation about self-development. That’s a conversation that all employees (and students) can buy in to. It’s up to all of us working in performance management to continue to reclaim and reinforce the humanistic side of performance management.

Two: Hard work without measurement is folly

Rapid learning comes at the intersection of knowledge and data. As Barber states in the lecture: “Many people peddle the myth that data undermines creativity and the joy that may come from it.” But these people ignore that there’s no creativity unless you have a feedback mechanism to improve your own performance over time. And to be effective, that feedback mechanism requires data.

Performance management take-away: In a business environment, performance management is your feedback loop. It’s the constant cycle in your work that facilitates learning and improved performance.

Measurement is the core of the learning process. If you don’t have a feedback loop built on data to guide your behaviour, you’ll never achieve exceptional performance.

Three: Measurement creates the right circumstances for leaders to lead

Greatness is about much more than just data. But good data and measurement creates the right circumstances for leaders to lead.

As Barber stated in the lecture: “[you] cannot mandate greatness; greatness has to be unleashed …[The] role is to create the circumstances in which success is possible while teachers and school leaders lead the way to greatness. Part of the context has to be good, close-to-real time data at classroom, school and system level.”

Why can’t you mandate greatness? In Barber’s opinion it’s because: “[every] decision requires more than the evidence. It requires judgment, analysis and ethics too. If you put it mathematically it might look like this: DATA x ANALYSIS x ETHICS x JUDGMENT = GOOD DECISIONS”

Performance management take-away: Like in the classroom, measurement enhances the role and impact of leaders.

Rather than displacing the role of leaders, great performance management increases their impact. With more data, leaders have the ability to take better actions faster.

Four: The problem is never the measurement – it’s how humans use the data

The problems with measurement typically come from how humans choose to use the data (not the measurement itself).

To quote from the lecture: “The risk is that through false interpretation of the data or through a failure to recognize that the data is incomplete, human beings mislead themselves; or, worse, that by manipulating the data or the presentation of it, one group of human beings deceives another.”

Performance management take-away: You can implement the best performance management tool in the world (And yes, we think Cognology is one of them!). But it’s equally critical to make sure your people are adequately trained and resourced.

Performance management is a human process. As such, there’s a huge amount of leverage in making sure your people deeply understand the aims of the process and have the resources they need to complete it successfully.

In conclusion

There’s some fascinating thinking in this lecture on how we can use measurement to improve the learning process across the whole of society (and more specifically in the business context of performance management).

Fundamentally, without measured performance there’s no feedback loop. And without a feedback loop, there’s no learning. This is why growing recognition of the importance of measurement makes it an exciting time to be in performance management. Getting measurement right in schools and businesses worldwide has huge potential to improve global happiness, living standards and productivity.

And as always, I’d love to hear what you think of this article. You can add your thoughts in the comments below, or join the conversation on Twitter via @Cognology.

The post Joy, data (and performance management?) appeared first on Cognology.

This week I’ve got a humorous post, with a powerful takeaway. I hope you enjoy – Jon

The core reason that we do performance management is to help employees learn. And to drive learning, all you really need to do is set good expectations, and to follow them up with regular feedback.

The performance management equation is really this simple:

Great performance management = Expectations + Feedback

So what happens when you get this equation out of balance? I thought it would be fun to use some GIFs to make a serious point about why both expectations and feedback are critical for effective performance management. I laughed quite a bit when putting this together!

What happens when managers give feedback, without reference to expectations

Big problems occur when feedback is given without clear reference to expectations. Here are five of the most common reactions that can happen when feedback isn’t based on expectations…

I just have no idea where this feedback is coming from

When did we talk about this, so called ‘deliverable’?

Where did that random comment just come from?

Say what about my performance?

I was meant to have done what?!?

What happens when employees don’t get enough feedback

Different problems occur when expectations exist, but there’s not enough feedback. Five of the most common conversations in a low feedback environment are…

I guess I think we’re going ok?

What should we do next?

I have no idea where to get started!

It’s all urgent

I don’t really remember what my expectations are…

And now, finally, what happens when you have clear expectations and ongoing feedback…

When expectations of behavior and performance are made clear, and feedback works well in concert with those expectations, here are five reactions you can expect to see in the office:

How you feel

How your employees feel

What it’s like walking round the office

What the rest of your team think

What your boss thinks

The post Performance management explained with GIFs appeared first on Cognology.

Back in April, my interest was piqued by an article in the Harvard Business Review. It focused on Deloitte’s new performance management strategy, specifically the research and thinking behind the innovations. But it wasn’t the first clue we’ve had that performance management (PM) is changing.

Intel’s OKR (objective and key results) strategy has been sweeping through technology companies for years. More recently, we’ve seen Adobe, Juniper and Microsoft drop annual performance reviews and forced rankings. Now Accenture, one of the largest companies in the world, has announced plans to do the same. With this in mind, I thought it was high time we took a look at the new initiatives that are revolutionising performance management.

The old model

To understand why performance management is changing, we first need to acknowledge the aspects of the old model that are struggling to meet our needs.

Based on annual or biannual reviews, the traditional approach is all about setting long-term goals and objectives: it doesn’t respond to changing needs or provide in-the-moment feedback. Employees are rated by their managers based on their overall performance for the year, and some companies use forced rankings (where managers rate employees relative to the performance of their peers, distributing ratings into a pre-specified distribution) to further quantify performance.

This model is gradually being phased out as new research demonstrates that numerical ratings have a negative impact on engagement and self-confidence.

89% of organisations surveyed for the Global Human Capital Trends 2015 report have recently changed their performance management strategy, or intend to do so within the next two months.

Yearly reviews have also been found to be less valuable to both individuals and performance than regular feedback – in fact, in a past blog I shared recent research that showed the optimal period between one-on-ones is just one month.

The new model

The new approach is all about agility and flexibility, so there is no universal approach as companies search for solutions that work best for them. However, there are, a couple of characteristics that these new models have in common.

1. Real-time feedback

One of the most prominent changes across the board is the increase in feedback (something I noted when we were looking at changes to Performance management over the last five years). This increased transparency means that employees are always aware of where they stand, and it prevents managers from delaying tough conversations with under-performers.

Since adopting this approach in 2012, Adobe has reported a spike in productivity. Its Global Senior VP of People and Places even credits the new model with the stock price spike it has experienced since adopting it (Adobe’s not the first to identify the benefits of agile performance management either).

2. Tailored approach

Research has shown that setting clear goals and objectives are essential to the success¹ of any PM strategy (whether you’re working on the old system or the new).

Accenture and Deloitte have both championed a one-size-fits-one approach. Requiring more training for managers, this system focuses on coaching individuals to succeed in their roles and managing to their strengths (i.e. helping to expand roles and move employees into the positions best suited to their skills).

In a 2014 survey by Deloitte, 68% of HR respondents cited performance management as ‘important’ or ‘very important’. This year, that figure rose to 75%.

3. Team-centric goals

The new models also focus heavily on collective goals, aiming to improve collaboration and performance by setting targets that require the strength of an entire team to meet.

4. Integration

Technological advances mean that performance management is no longer an isolated HR initiative and can be integrated into our day-to-day lives.

Adobe’s ‘Check In’ system, for example, is completely isolated from HR. It allows both employees and managers to set specific goals for each fiscal year and requires review meetings at least every eight weeks. At the yearly rewards check in, managers can assign rises and bonuses based on how well an individual has met their targets.

5. Categorisation

The new models all acknowledge that understanding your workforce is critical, and categorisation goes hand-in-hand with all of the four points I’ve already touched on.

If we’re regularly meeting with employees, it is that much easier to identify who the high potential individuals are. The agility of the new approach, with its real-time feedback and individual focus, enables managers to instantly identify talent. By disassociating the process from HR and managing to strengths, managers can move these folks more quickly into situations where their skills yield the most value.

In conclusion:

It might look like a completely new system, but it’s really not all that different to the old model. Yes, today’s workforce wants an agile, flexible approach, but the needs the new strategy meets are exactly the same as those met by the traditional system. We still need categorisation, open communication, feedback, progression and development; we’ve just shifted our focus slightly. Now, we’re working to meet these needs in real time — and reaping the engagement, productivity and staff retention benefits of this new approach.

Reference:

¹Lawler, E. E. 2015. Performance management: the three important features you’re forgetting. Forbes.

The post Redesigning performance management – key trends of 2015 appeared first on Cognology.

It’s a Brave New World

Steve Carell stars in ‘The Big Short’

I recently listened to a great interview on EconTalk, where journalist Adam Davidson spoke about his experience as a technical advisor for the upcoming movie, The Big Short. On his first day on-set, Davidson was amazed that over 150 people were already working before ever having a full company meeting to strategize the process. Even more incredibly, many of these professionals had never worked together before. And yet, everything moved like clockwork.

Davidson experienced first-hand a style of hiring and working known as the ‘Hollywood Model’. A bunch of specialists, usually freelancers, are pulled together to form a team, and each person is hired only for the length of their component of the project, ranging from a few days to over a year. The team disperses as rapidly as it formed.

In his article for the New York Times, and an upcoming book, Davidson posits that the ‘Hollywood Model’ and the ‘Gig Model’ (used to describe very short-term jobs like Uber or TaskRabbit) will dominate the future of work. And this, for some, could be a very good thing.

The Changing Face of Employment

The traditional, corporate model of employment (join as a graduate, work for 40 years, retire, and get a gold watch) has been waning since the dawn of the twenty-first century. After that, younger people started job and career ‘hopping’. Many corporations no longer needed long-term positions, so what had been previously steady jobs were outsourced, while others were replaced by technology.

In this world, the specialized freelancer is king, evidenced by the growing numbers of people who work as freelancers.

So what are the benefits of freelancing for freelancers?

1. Specificity

While on set, the movie’s makeup designer told Davidson that zombie makeup (yes, making people look ‘undead’) was all the rage. People skilled in this particular area were in greater demand and, as a result, they earned greater pay. Makeup artists looking to build their repertoire started to expand into the ‘zombie area’.

Freelancers can build their skillsets based on what’s trending. They can find a way to work within a niche that separates them from the pack. The Internet makes it a cinch to develop a niche and then find the right market.

2. Leverage

Freelancers can use their in-demand skills to negotiate higher pay. For example, at a large corporation, two analysts might perform the same job, but one analyst outperforms the other. In the corporate model, both analysts are likely paid the same, but as freelancers one might command far more.

In short, freelancing favours the highly competent. As an employer, this means that you can ensure you get best bang for your employment buck too.

3. Reputation

Especially, Davidson points out, in a world like show-business where everyone rubs elbows, word gets around about who is reliable and who is likely to flame out. A good working reputation helps freelancers get more work, and find better projects.

What are the benefits of hiring freelancers for employers?

1. Short-Term Contracts

After doing some research, you can hire freelancers with good reputations for a single projects and judge his or her fit with your mission. You can even assign a test project, with little money down, to make sure he or she will be able to meet deliverables.

2. Reliability

For freelancers, a solid reputation is everything. And now you can find freelancers based on trusted references or online reviews. Sites like Elance.com and Freelancer.com provide client reviews of the independent contractors, so you can make selections based on how well a freelancer rates compared to others.

3. Savings

Not only is hiring a long-term employee a bigger risk if he or she isn’t a fit, you also have to provide all supplies, software, and any necessary training. By choosing a freelancer, you can find someone who already has the skills, software, or access you may need.

4. New Managers

As I’ve written in my blog before, new managers should always start by managing freelancers. By letting the managers assess the success of projects over time, they can see how their own interactions with freelancers meets (or doesn’t meet) the objective.

Are There Still Benefits of Permanent Employment?

If freelancing is growing in market-share and can save money, what are the benefits of permanent employment? Should businesses be shopping all their work out to independent contractors?

In a word: no. In the interview, Davidson points out the not-insignificant benefits that come with having permanent staff. Both companies and workers see and experience benefits from a permanent employment model.

While pay for freelancers can move up and down based on current trends, businesses and permanent employees are shielded from these market signals. No matter what your staff excels in, a business is still paying a fixed rate. This shields the business from ballooning costs for services if one particular service (for example, zombie make-up design) suddenly experiences increased demand.

Employees are also shielded from these market effects. If the market for their specialty (say, copywriting) bottoms out, permanently employed copywriters are not affected. They are equally unaffected if the cost for their work goes up.

What is the Future of Work?

It’s possible that the permanent work structure we consider ‘normal’ was just an aberration of the twentieth century. As industrialization and commoditization increased throughout the 1900’s, a company’s main initiative was to produce for the lowest possible cost in order to compete. Now, in a market saturated with cheap goods, more companies are working towards creating greater value, differentiating themselves, and avoiding commoditization.

To remain agile and ahead of competitors, companies need to work with more skilled people, and need more flexibility to hire contractors for limited assignments. Freelancers who strive for excellence, are reliable, and are better than average are set to benefit most from this scenario.

Does your business currently utilize independent contractors? What projects do you find lend themselves best to freelancers? I’d love to hear your thoughts below or join the conversation via Twitter @cognology.

image: https://upload.wikimedia.org/wikipedia/commons/1/1a/Steve_Carell_2010.jpg

The post Are terms like ‘Hollywood’ and ‘Gig’ Spelling the End for the Traditional Employment Model? appeared first on Cognology.

Back in January, I posted a snappy article on performance management. It wasn’t full of the latest research, complicated metrics or breaking news, but it certainly inspired a lot of you. Which got me thinking, we don’t always need cutting-edge data to instigate a change. Sometimes, we just need an inspirational word from someone worth listening to.

When you’re looking for an inspiring approach to people management, the tech companies are a good place to start. In a year when Netflix’s culture document went viral, Google was once again crowned the no. 1 place to work, and Intel’s OKR strategy infiltrated Accenture (one of the biggest companies in the world), it became pretty obvious that these guys are leading the way. So what can we learn about people management from the CEOs presiding over these HR whirlwinds?

1. “Work for someone who believes in you, because when they believe in you, they’ll invest in you.”
– Marissa Mayer, Yahoo CEO, knows the importance of investing in individuals.

2. “Unless I feel like I’m working on the most important problem that I can help with, then I’m not going to feel good about how I’m spending my time.”
– For Facebook CEO Mark Zuckerberg, it’s all about managing to strengths.

3. “We don’t have as many managers as we should, but we would rather have too few than too many.”
– Larry Page, founding CEO of Google, isn’t a fan of micro-managing.

4. “If there’s someone really good who has excellent industry experience, we like working with them, [they have] common sense and fit our values, we just hire them, because the biggest thing is having smart people who work well together.”
– Vocus Communications CEO James Spenceley focuses on hiring the right personality types.

5. “Teaching your employees something new creates an instant connection, and they will respect you for it.”
– For Taso Du Val, CEO of freelancer networking site Toptal, it’s all about continued development and on-the-job learning.

6. “You gotta build a team that is so talented, they almost make you uncomfortable.”
– Brian Chesky, CEO of AirBnB, focuses on talent.

7. “The key thing is really aligning everybody so they all understand where you’re going.”
– Eytan Lenko, CEO of Aussie company Outware, knows that a clear vision is important.

8. “I’m a big believer in lessons learned. Constantly with the team we go over, why? Why? Why? … The only bad mistake is a mistake you don’t learn from.”
– For Ginni Rometty, CEO of IBM, on-the-job-training takes many forms.

9. “Millennials … are more socially and globally connected … than any prior generation. And they don’t question; they just learn.”
– Intuit’s CEO Brad Smith recognises that younger workers have different learning and development expectations.

10. “At most companies, average performers get an average pay rise. At Netflix, they get a generous severance package.”
– Netflix is known for bucking silicon valley’s people management trends. What do you think of CEO Reed Hastings attitude to performance management?

The post Top Ten CEO Quotes on People Management 2015 appeared first on Cognology.

Performance management is undergoing somewhat of a revolution. In some circles, the argument is being made that the six-month or annual review provides too little information and is too late in coming.

While most companies don’t rely solely on formal performance rating meetings to provide one-on-one feedback, a number of company leaders posit that ongoing feedback could actually replace the annual review entirely.

Is there a case for change?

Based on a series of public announcements, a consensus amongst a number of well-known organisations seems to be emerging: performance reviews can be too retrospective, too infrequent, and vulnerable to bias on the part of the rater. In today’s real-time working culture, undergoing review only once a year could be far too infrequent to be effective.

Recently Adobe, Accenture, Deloitte, and other major players announced ‘scrapping ratings’ in favour of departing from the performance review to the performance prediction.

Deloitte’s¹ research revealed that “more than half their questioned executives (58%) believed their current performance management approach drove neither employee engagement nor high performance.”

Additionally, rather than providing an accurate index into the employee’s job performance, evaluations were found to be somewhat more indicative of the knowledge and psychological peculiarities of the raters themselves. That data bears out:

A survey published in the Journal of Advanced Psychology² found that of 4,492 managers rated on certain performance metrics by two bosses, two peers, and two subordinates, 62% of the variance in ratings was due to the raters’ personal biases. Actual performance only accounted for 21% of the variance. That translates into a vast range of opinion in what should have been a relatively objective rating process.

Then there is the problem of ‘sugarcoating.’ Knowing the employee in question will be privy to their result, and that a rater will have to discuss and possibly defend their comments, tends to put raters in the position of being overly generous rather than realistic.

New Talent Pool Demands New Solutions

As millennials crowd the workforce (they will comprise 75% of the world’s workers by 2025) the need to work with, rather than against, this demographic is crucial. Millennials are accustomed to real-time gratification. They’re driven by feedback that’s both ongoing and encouraging. A recent survey by Intelligence Group³ shows their priorities:

Millennials may be more forcefully expressing it, but they want what all employees want: feedback that is thoughtful, helpful and productive, and in real time.

According to a Fast Company⁴ survey millennials aren’t shy about their disdain for evaluations:

There is an emerging trend by organisations to replace or modify their rating systems. The number of employers that are either changing the numerical rating system or giving up on evaluations altogether is growing. The trend has increased from 4 percent in 2012 to 12 percent in 2014, according to a Corporate Executive Board (CEB)⁵ survey of Fortune 1,000 companies.

Rebranding ratings

It would be more wishful thinking than reality to believe there are no ratings needed or being enforced in companies. Certainly the different categories, pay ranges, and levels of responsibility effectively “rate” staff to a large or small degree, whether we want to admit it or not.

While Deloitte may no longer reduce a year’s work to a percentage score, they still needed to find a way to recognise excellence and adjust poor performance. Their solution:

Rather than measuring opinions about what happened, they now ask for predictions and opinions about what will happen (or ought to happen) in employee’s future. They ask only 4 questions: the first 2 are rated 1 through 5, and questions 3 and 4 are simply answered yes/no:

Given what I know of this person’s performance, I would always want him or her on my team.
Given what I know of this person’s performance, and if it were my money, I would award this person the highest possible compensation increase and bonus.
This person is at risk for low performance.
This person is ready for promotion today.

Questions are posed as part of a survey at the conclusion of each project rather than at the end of the year. The new process, called the “performance snapshot” evaluates at a single moment, rather than the culmination of a year’s work.

Ensuring Evaluations Remain Fair

The organisations mentioned in this article believe that eliminating yearly reviews in favour of a more ad-hoc approach will actually improve – or at least not degrade – the accuracy of the evaluation. However, for anyone looking to adopt a similar approach, it seems wise to include measures that will ensure evaluations remain fair.

Alastair Woods, PwC’s reward team director, summarised this succinctly:

^“6Companies need to be careful not to throw the baby out with the bathwater. Without the year-end rating, the danger is that the distribution of pay and bonuses can become even more of a dark art as shadow systems evolve without proper governance and infrastructure behind them. Our research shows that when done well, with a balance between rewarding past performance and considering future development needs, performance conversations can really motivate employees. And many employees appreciate the clarity that an effective formal assessment provides.”

Enhancing Performance Ratings with Real Time Feedback

I don’t believe that removing ratings is where the change needs to occur; rather we need more regular and real-time feedback and coaching conversations. And so it’s interesting to note that Deloitte has introduced their own version of Adobe’s “check-in’s” for their teams.

Check-in conversations are the team leader’s responsibility: they meet with team members to review projects, set expectations, provide coaching and more. The meetings are initiated by team members, giving them ownership of their development. HR merely monitors that meetings are held weekly.

The check-in system, or other methodologies like it, shows significant value in terms of real-time, usable feedback that enhances productivity, engagement, and ownership for employees. When used to augment the annual/bi-annual review system, these solutions can provide staff and team members with an open line of communication that’s based on trust.

Conclusion

Overall, it’s not rating employees in the purest sense that should be avoided. The shift in thinking is to work in real-time to achieve goals and growth, rather than reflect on (and punish) past performance that cannot be changed.
There is definite cause to re-evaluate the effectiveness of existing annual review process if you haven’t done so already. However, make sure that any new system is largely based on objective data.

Many organisations are looking to improve their performance management process and part of this is of course how ratings are used. From announcements and articles and the organisations I meet it’s clear there is a rating’s evolution underway but in most cases these are subtle adjustments or enhancements to address the perceived needs of the employees within a certain organisation.

Deloitte believes their alternate subjective approach will produce similar results but without the significant effort and costs they currently incur, however it would be fair to say that this substantial change would not be for all organisations.

I certainly believe that any widening of the channels of communication through more regular and structured check-ins will be the most important improvement. This will enable the detection and addressing of issues earlier, and I believe build trust and increase engagement across the workforce.

In a future article, I will share my own recent findings from consultations with a number of Australian organisations that are reviewing and redefining their performance management processes.

References

¹Performance management is broken
Replace “rank and yank” with coaching and development
Deloitte University Press

²Understanding the Latent Structure of Job Performance Ratings
Michael Mount, Steven Scullen, and Maynard Goff
Journal of Advanced Psychology

³What Millennials Want In The Workplace (And Why You Should Start Giving It To Them)
Forbes

⁴The Future of Work
Here’s what millennials want from their performance reviews

⁵Corporate Executive Board (CEB) survey of Fortune 1,000 companies

⁶More companies planning to ditch annual performance reviews and ratings, but will employees benefit?
PwC research

The post Should You Drop Performance Ratings? appeared first on Cognology.

With Rio in full swing and the country getting competitive, what better time to take a look at the all-stars dominating our favourite sport, Talent Management? Time to find out who won big in the categories that really matter; Onboarding, Performance Management, and Learning Management.

Gold

Those of you who read my article on onboarding and employee success will know that well-designed onboarding practices are key to ensuring new hires integrate quickly and perform at their best. Amazon-owned retailer Zappos took the gold in this category for its focus on protecting and promoting company culture above all else.

Landing a job at Zappos isn’t easy. The retailer puts the same emphasis on personality and cultural fit as skills and experience, applicants have a 1.5% chance of receiving a job offer¹. But an offer doesn’t mean new hires can breathe easy. Whatever their level or department, everyone goes through the same four week course, receiving extensive training in customer service and company values².

At the end of the four weeks, new hires have two options; head to the office and get started, or take a $2000 payout and leave if they don’t fit the company culture. Less than 2% opt to take the money and run³, with 98% starting work on Monday engaged and committed, knowing exactly what to expect.

Silver

Facebook scooped silver for an onboarding process that is fast and engagement focused. New hires arrive to find their requested PCs, personal devices, and systems all set up and ready to go; but it’s the developers’ boot camp that really won the day for the social media goliath. Developers aren’t hired for specific teams and departments. Instead, they spend six weeks training at HQ and get to choose which department to work in when they graduate⁵, cherry picking the projects that most excite them.

Bronze

These guys are secretive, but rumour has it Apple is a find your own feet kind of employer. New hires are greeted on their first day by any specialist tools they need, a new iMac, and a t-shirt with ‘class of’ and the year of joining. They are expected to dive right in, set up their own computers and introduce themselves to co-workers⁵. It isn’t for everyone, but this ‘do-or-die’ approach certainly means employees hit the ground running.

Gold

I’ve spoken before about Google’s performance management process, so it should come as no surprise that it romped home in first place. This well-deserved gold was awarded for the search giant’s extensive research and the resulting unbiased, 360-degree performance management processes.

Google’s research into employee performance identified two main factors influencing success; clearly written goals, and frequent conversations between individuals and managers⁶. These findings form the basis of a complex, 360-degree feedback cycle that begins with self-evaluation before peers review an individual’s fit with the company culture (a.k.a Googleyness), analytical abilities, execution, thought leadership, leadership, and presence. Peers grade based on strengths, weaknesses, and contributions⁷.

This feedback is used by managers to provide a draft grade, a non-numerical evaluation on a five point scale that ranges from ‘needs improvement’ to ‘superb’. All performance data then goes through a calibration stage, where heavy-handed or lenient graders are identified and employee scores adjusted⁷; giving employees an accurate, unbiased view of their performance.

Silver

Beauty subscription service Birchbox has a dedicated People & Culture team that manages the complete employee experience, with a focus on aligning individuals to organizational goals⁴.

Bi-monthly pulse checks and two yearly, quantitative studies mean they can guide managers and board members on how best to align employees and skills to developmental strategy and initiatives⁴. This integrated approach to business growth and performance management was well-deserving of a silver medal, don’t you think?

Bronze

Goldman Sachs is breaking the mould with its recently overhauled performance management system. Designed to improve staff retention, the Wall Street stalwart has swapped its traditional numerical grading system (complete with automatic layoffs for the bottom 5% of performers) for a qualitative approach almost unheard of in the financial sector⁸.

Now, the focus is on providing high-quality, continuous feedback. Reviews are conducted earlier in the year, giving individuals a chance to improve before bonus time⁸. To reduce grading bias, the new system even uses a similar calibration method to Google⁷.

Gold

Global consulting firm Cognizant was streaks ahead of the competition and landed gold for its Millennial-friendly approach and focus on integrated learning.

With a predominantly Millennial workforce⁹, many who work on-site with clients, the Cognizant learning and development (L&D) strategy needed to be agile, mobile and engaging. The company rose to the challenge, producing multiple learning platforms such as blogs, customized portals, live webcasts, and discussion forums⁹. But the jewel in its L&D crown is ‘One Cognizant’ an app store boasting over 50 learning apps. From gamification to ebooks and progress planners, individuals can choose the tools best suited to their learning style⁹.

Recognising that L&D is an essential element of organisational grown, Cognizant’s ‘5D’ approach to content focuses on aligning learning with long-term objectives. The senior team establish organisational goals first, identifying potential impediments and their solutions, and provide a mix of informal, formal, and collaborative learning initiatives that enable staff to deliver on those goals⁹.

Silver

Like Cognizant, silver medal winner Hilton Worldwide delivers a suite of learning tools to a global workforce. Its L&D strategy is focused on maximising employee performance with self-guided tutorials, interactive workshops, one-to-one training and courses. Learning is typically tailored to the needs of the individual, with employees identifying their own skills gaps and receiving the training and support they need to address themⁱ⁰.

Bronze

Healthcare provider Virgin Care has recently been shortlisted for the Employee Engagement Award thanks to its ‘People Flourish’ learning management system. In a sector known for its apathy to learning and development, this revolutionary program provides staff with leadership training; delivering four modules on people, personalities, and behaviours that are designed to help individuals progress to management positions. It’s an investment that’s paying off, with the program delivering a 22% increase in employee retention¹¹.

To Sum Up…

The tech sector dominated our talent management competition, scooping gold in both the learning and onboarding categories. However, we’re already starting to see Silicon Valley’s innovations trickle into more traditional sectors, as demonstrated by both Goldman Sachs and Virgin Healthcare. These guys are rejecting the typical model of Talent Management in their industries and are already reaping the rewards. Let’s hope more employers follow suit – by 2020 this is likely to be a far more hotly contested race!

Any ideas here you could borrow? I’d love to hear your thoughts on these approaches. Would any work in your office?

References

¹Michelle, J. 2011. The Zappos Experience. Inc.com
²Zappos. 2016. Onboarding Fact Sheet. Zappos
³Reynolds, 2016. 3 Companies With the Most Unique Employee Onboarding Process. TinyPulse.
⁴Doshi and Gregor. 2015. The secret to an ideal work culture. Time Magazine.
⁵Bhattacharyya, 2016. Employee Onboarding at Facebook, Google and Apple. The Qustn Cafe.
⁶L&D, 2016. How performance feedback is evolving. L&D.
⁷QCulture, 2015. Google’s Performance Management Practices. QCulture.
⁸Shen, 2016. Goldman Sachs is about to make life a bit less stressful for employees. Fortune.
⁹Meister, 2014. Cognizant Academy: Lessons from a 2020 Learning Organisation. Forbes.
¹⁰Association for Talent Development. 2014. Hilton Worldwide. ATD.
¹¹Virgin Care, 2016. Virgin Care Shortlisted for Employee Engagement Award. Virgin Care.

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From FBI investigations to opinion polls and some unfortunate word choices, American Presidential hopefuls Hillary Clinton and Donald Trump are filling the column inches and keeping the world’s media on its toes. One article caught my attention last month and sparked more than a little curiosity about how they each run their campaigns. I’m not talking about the merchandise-laden tour buses and charged debates, but the experts, aids, and volunteers bustling about behind the scenes.

In 2012, Ann Marie Habershaw – the COO behind Obama’s 2012 reelection campaign – revealed that hiring practices among staffers were, at best, ad hoc. She was responding to a Tweet from Nathaniel Koloc, then CEO of recruitment firm Rework. She told him that department heads often make hiring decisions on the fly, and campaigns are inevitably run by friends of friends and talent sourced through word-of-mouth.

As though to prove her point, three years later, Habershaw mentioned Koloc to Clinton’s deputy COO, who called to offer him the position of Director of Talent Acquisition and Development on the Hillary for America campaign. That makes Clinton’s outfit the first major political campaign to have a role dedicated to people management and talent sourcing¹. An interesting move, don’t you think?

Which got me thinking, what can we learn about people management from these two very different candidates?

Clinton

25 seconds in, learning from criticism. 3.29, expressing her opinion and identifying problems without micromanaging the solution. 5 mins in, importance of compromise for progress.

Team and Hiring Style

The first female nominee is known for her close inner-circle. Many of the major players on her staff have been with her since she was First Lady, and she has retained a number of employees from her time at the State Department – not to mention some notable names from both husband Bill’s and President Obama’s campaigns².

This tried and tested team have proven they can handle anything a Presidential election might throw at them, but Hillary has also future-proofed her staff. Her established team is joined by new hires with more contemporary skill sets, like Marlon Marshall, who is known for his alternative approach and willingness to operate contrary to established Washington precedent². Interestingly, it’s an attitude mirrored by campaign manager Robby Mook, who worked with Clinton on her 2008 campaign.

Personality

The thousands of work emails now available to the public reveal a lot about Clinton’s character and how it translates to her management style.

Performance-orientated Clinton is happy to circumvent time consuming, official procedures when she judges them irrelevant. For example, when waiting to receive a statement which lacked any sensitive information but had been classified top secret, she instructed the sender to simply email it directly (and against protocol), ensuring the document was available there and then without delay.³

“Take criticism seriously, but not personally. If there is truth or merit in the criticism, try to learn from it. Otherwise, let it roll right off you.”

Source: Huffington Post

Management Style

There may be no better way to define Clinton’s management style than with her own phrase, ‘smart power’. It encapsulates the need to learn and adapt to new situations in pursuit of the best possible outcome⁵. A practice reflected in her team, who embody a mixture of experienced and unconventional thinking.

Throughout her public career, Clinton has championed training and skills development.

In a primary debate in 2007, she advised against contracting out government jobs, an expansion of her 2006 idea to form a ‘public service academy’. Much like a military academy, this theoretical institute would train civil servants for free in exchange for a set number of years work. It’s a management approach that offers benefits at both an individual and organisational level, the organisation in this case being the USA⁶.

Defining Principles

Compromising.
Manages to strengths.
Performance orientated.

Trump

On being detail orientated (1 min 32 in), 2.50 attitude to employee performance.

Team and Hiring Style

The Republican nominee launched his bid for The Oval with a very small team. Including long-time advisors Roger Stone and Corey Lewandowski, his initial staff had little political experience and were later joined by communications and foreign policy teams that, again, consisted of strategists and consultants with little or no experience in the political arena⁷. Trump opted for those he knew and trusted from his years in industry rather than new faces or unknown experts.

However, as the election gained momentum, Trump’s hiring policy changed in response to the developing needs of the campaign. Established political consultant Paul Manafort came on board, bringing with him over 30 years experience in presidential politics. At the same time, those in Trump’s team with political backgrounds were promoted, and the campaign strategy took on a more traditional approach, with Manafort introducing teleprompters and speechwriters⁷.

Personality

Intuitively driven, Trump is not a manager bound to the status quo. He is known to base his hiring decisions on gut reactions, and places greater emphasis on potential than experience.⁸ It’s a focus reflected in his initial campaign team, picked for their skills rather than their experience in the political world.

“Management is an art that is very important to me. Having leadership skills and employees that love their work is one of the great joys of life.”

Source: Sullivan and Costa, 2016. In campaign chaos, Trump shows his management style. The Washington Post.

Management Style

As a manager, Trump has high expectations. He leads by example, working around the clock and expecting his employees to do the same⁸. He also cultivates a competitive environment, actively encouraging rivalries even amongst high-level employees like Manafort and Lewandowski⁹ (those of you looking for another approach to aligning employees with organisational outcomes might want to check out my recent article, Aligning People: A Leader’s Greatest Challenge).

Trump has a well-founded belief in his abilities, appears very resilient to criticism, and is confident that his approach is the best.ⁱ⁰ He doesn’t delegate big decisions and takes personal responsibility for the outcome of projects in all fields⁹. It’s an exhausting style of management, and not one many could successfully emulate, but it is fantastic for achieving huge successes and is the reason he can deliver on projects that would be unattainable to other managers.

The best example of this is his campaign, which has taken him from a candidate with no elected experience –– not even running experience – to a nominee; a victory that has only been achieved by a handful of men, most notably Herbert Hoover and William Howard Taft¹¹. In the light of this success, his claim that he is a quick learner¹² seems well founded; and clearly he expects the same from those around him. When the campaign hit a snag in March, it was Lewandowski who hired Manafort and his company of politically savvy aids to put it back on track¹³, demonstrating a penchant for agile learning in Team Trump, with senior staff continually assessing performance, identifying missteps, and adjusting their strategy in response.

Defining Principles

Intuitive.
Hierarchical.
Performance orientated.

To sum up…

Trump’s experience in industry and Clinton’s decades in Washington have created two very different managers with two very different approaches, but they both have two values in common: performance and agile learning. Only time will tell which management style is the best suited to the political arena but I, for one, cannot wait to see the outcome.

What are your thoughts on these two approaches? How would they translate to your organisation?

References:

¹Krueger, 2016. How the Hillary Clinton campaign built a staff as diverse as America. Fast Company.
² Anon. 2016. Hillary Clinton presidential campaign staff and advisors, 2016.Ballotpedia.
³ Klapper and Lee, 2016.What we learned from 52,000 pages of Hillary Clinton’s emails. PBS.
⁴ Sanghoe, 2015. 5 important leadership lessons from Hillary Clinton. Huffington Post.
⁵ Shambaugh, 2010. Leadership secrets of Hillary Clinton. Forbes.
⁶Katz, 2015. What a Hillary Clinton presidency would mean for the federal workforce. Government Executive.
⁷ Anon. 2016. Donald Trump presidential campaign staff and advisors, 2016. Ballotpedia.
⁸Kruse, 2016. The executive Mr Trump. Politico Magazine.
⁹Sullivan and Costa, 2016. In campaign chaos, Trump shows his management style. The Washington Post.
ⁱ⁰Gaskell, 2016. 4 Leadership lessons from Trump. Forbes.
¹¹Raunch, 2015. Amateurs in the Oval Office. The Atlantic.
¹²Dickerson, 2016. How fast does Donald Trump learn? CBS News.
¹³Moussa and Newberry, 2016. What we can learn from Donald Trump’s campaign reboot. London School of Economics (US Centre).

The post Clinton vs. Trump: Two Alternative Approaches to People Management appeared first on Cognology.

A whopping 65% of Australian HR managers admit to hiring an employee who failed to meet their expectations¹. These poor performers are an expensive commodity. They reduce productivity², monopolise their managers’ time³, and drag down the morale of those around them¹.

With so much at stake, addressing under performance is crucial to long-term organisational success. However, poor performance is a complex issue, and there are many reasons why someone might not be giving work their all. More often than not, that reason lies with their manager. So, how do we separate the true poor performers from those who are struggling to meet expectations?

The Reasons Behind Poor Performance

There are two main reasons why someone under performs; lack of ability, and lack of motivation⁴.

Ability is governed by more than just skill. While competency gaps are an obvious reason for poor performance, a lack of resources, expectations, and understanding will also affect an individual’s ability to perform well.

Motivation is influenced by both external and internal factors. Mental health issues such as depression can impact productivity and motivation⁵, as can tensions within a team, concerns over job security⁶, burnout, and a lack of incentive or accountability⁴.

Source: Eagle Hill Consulting

Managing Poor Performers

When addressing performance issues, do not view the individual as a poor performer. Assume that the problem is your responsibility since, as a manager, you are ultimately responsible for setting expectations, ensuring they are understood, and providing resources that enable staff to deliver on their objectives. Managers also have a huge impact on motivation and job satisfaction.

A one-to-one conversation is the quickest way to identify the problem. Avoid comments that sound critical or personal, and instead keep the conversation forward focused,

“I noticed that you’ve been struggling to meet deadlines recently, and I wanted to check in and see if there was anything I could do to help.”

By the end of the meeting, you need to have a thorough understanding of how that individual does their job and what obstacles and everyday problems they encounter.

Don’t be surprised if you hear the phrase, “I’m working as hard as I can”, or “There is nothing more I can do.” In my experience, this is true, and the individual really is working to the best of their ability. As managers, it’s down to us to identify any obstacles and address inefficiencies.

Training and Coaching

If your performance conversation highlights a skills gap, then it is your responsibility to address it. Providing employees with the opportunity to gain job-related skills introduces new ideas and encourages innovation, increasing productivity in the process⁷. Don’t be afraid to allow individuals the freedom to implement those ideas, either. Giving employees the autonomy to adjust ineffective workplace processes can improve performance at both a team and individual level⁷.

Ongoing feedback and coaching are vital to the success of any performance management strategy, especially when managing under performers. Coaching places the responsibility for finding a solution on the employee but provides them with the support they need to identify that solution. It’s a great way to increase confidence and help individuals prioritise their workloads, and can boost productivity by as much as 21%⁸.

If a lack of skills is the problem, then a combination of on-the-job training and coaching is often an effective solution. Don’t expect miracles to happen overnight, recognise that the process may take months and give the employee the time they need to address skills gaps.

Setting SMART Goals

If the individual doesn’t understand what is required of them, then it is up to you to establish clear expectations. Regular readers will know I’m an advocate of SMART goals, which are specific, measurable, attainable, relevant, and time-bound. By providing employees with a measurable objective and clear deadline, you increase responsibility for the outcome and individual accountability for performance.

Addressing the Impact on Team Members

In a US study, 68% of professionals cited a negative impact on employee morale as the biggest problem with poor performers. Most (54%) believe that they also play a pivotal role in cultivating an environment where a mediocre performance is acceptable⁹.

Leaders spend nearly 20% of their time managing under performers³, so it is crucial that you don’t overlook the rest of the team. Schedule performance conversations with those working alongside your poor performer. Focus on identifying any long-standing issues or obstacles facing the team as a whole and make sure that employees who are meeting or exceeding expectations feel valued and appreciated.

Knowing When to Quit

If intrinsic motivation is the problem, then you have on your hands a real poor performer. You can determine this by attitude, and a performance conversation or coaching session will generally be met with repeated negativity and disengagement. If this is the case, then the only solution is to remove the individual from their role.

To Sum Up…

Poor performance is a complex problem influenced by many factors. Addressing the issue requires a personalised approach, with a focus on improving workflow efficiency and providing individuals with the resources they need to meet expectations.

Do you have experience managing poor performers? Feel free to share your ideas, insights, and successes in the comments section below.

References

¹Robert Half, 2016. The cost of a bad hire: 10% of employee turnover is attributed to a poor hiring decision. Robert Half.
²Ekpang. 2015. Counselling for effective work performance: a way for service improvement. IOSR Journal of Humanities and Social Science. 20 (3). pp. 39-43.
³Robert Half, 2012. One bad apple. Robert Half.
⁴Marr. 2015. 7 causes of poor employee performance and how to address them. LinkedIn Pulse.
⁵Wang, et al., 2004. Effects of major depression on moment-in-time work performance. (Abstract) The American Journal of Psychiatry. 161 (10). pp. 1885-1891.
⁶Staufenbeil and Konig, 2010. A model for the effects of job insecurity on performance, turnover intention and absenteeism. Journal of Occupational and Organizational Psychology.
⁷Fernandez and Moldogaziev, 2010. Empowering public sector employees to improve performance: does it work? The American Review of Public Administration 2011.
⁸Cognology, 2015. A leader’s guide to coaching. Cognology.
⁹Eagle Hill Consulting, 2015. Are low performers destroying your culture and driving away your best employees? Eagle Hill Consulting.

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In my May 11 Blog, Should You Drop Performance Ratings? I discussed the revolution occurring in HR Departments and companies large and small with regard to the traditional performance evaluation system. Many companies are shifting away from the annual review to more flexible, on-demand evaluations to align with a fluid, on-demand market. The need to respond quickly not only to customer desires, but to the needs and wants of employees and managers is driving change in a system that has been largely unchanged and in place for decades.

Recently, six of our Cognology clients took the time to talk with me about how they’re evolving their performance management processes. They’ve developed some innovative solutions I wanted to share, along with general trends we’re seeing in the business community.

The Trends

Many companies that decide to upgrade their ratings system are developing processes that work just for them. They may add more frequency, build on the system in place, scrap the old model all together, or any combination. The variety of changes is as vast as the variety of companies. Some models will work for one firm, others for another. But they’re all based on the singular notion: engagement and innovation occur in real time, and so should performance management.

In some cases, the need to reduce the complexity of the system has been the driving force behind change, for others the need to reduce formality is the goal. In almost all cases, higher frequency feedback is implemented. In a highly competitive marketplace, business must be poised for change at a moment’s notice: as must their employees. When feedback is frequent and ongoing, change is easier to affect. And, as the lines of communication open and trust is built, the “we fear change” mentality shifts to “we can do it together.”

Another trend is to eliminate the “goal setting” aspect of the rating; exchanging it for predictive planning. Collaborating on achievable projections, rather than setting rigid goals, engages the employee in the growth process. Instead of telling staff members where you expect them to be within a specified time frame, you work together to achieve short-term milestones that translate into long-term growth. The payoff for employers are employees who reflect on their growth throughout their employment – not just when evaluation time is nigh.

Including self-initiated and self-reflective ratings give employees the opportunity to evaluate their own work with the guidance of their manager or team leader. In addition, they can also provide valuable insight into a staff member’s perspective on the company and their role in its success.

A common thread in all upgrades is that a system built on rigidity can create a barrier to employee engagement. Building fluidity into the process, even including an option to incorporate peer and crowdsourced feedback, changes the dynamic from assessment to teamwork. Some are even creating trust with audit logs as a fallback in the event of disagreements – an option to agree to disagree – that isn’t punitive, and can be reevaluated in future, if need be.

Building With Trust

Throughout any change initiative, trust is crucial. Upgrading a performance system is reliant on trust: trust that the change will be beneficial not only to the company, but to each individual staff member. Engaging staff in higher frequency feedback could be viewed as micromanagement or collaboration: how it’s seen and utilized by depends on how you frame the case for change. If employees know they can seek out feedback without fear of reprisal, productive communication can begin.

And fear of reprisal has some legitimacy: remember the traditional employee evaluation system, which intended to provide guidance and set goals, has long been tied to annual salary increases. Showing your weakness, in the past, may have meant a lower raise for the future. Staff will need to be assured the new system will not be punitive: that we improve as individuals and as a company when we seek guidance; discuss areas for improvement; or work together to problem-solve.

Monitor Change

As with any change, it’s important to monitor the effectiveness of each aspect of the new system as it evolves. Are more frequent feedback meetings opening lines of communication and breaking down barriers: if not, why not? Is self-evaluation providing insight and opportunities for planning: or are trust issues impeding its success? The payoff – as staff members participate in the evolution of the process, you should see them gaining ownership of their future. That ownership can translate to higher productivity and engagement.

Some adjustments may be needed along the way, but don’t let them discourage you from moving forward. Some methods will work well, others not, still others may need modification. But all attempts to upgrade will show staff that you’re working with them to drive their success, as well as your own. As you build on the knowledge you accumulate, you may very well develop a customised system that serves your company, your staff, and bottom line quite well.

Is Your Performance System Due for an Upgrade?

Is it time to make a change? You may not be comfortable with a complete overhaul, but some trends may intrigue: feel free to take them for a test drive. If they work, hang on to them: if not, try something else. Whatever motivates you and however the process evolves, the result can be real-time, actionable feedback. That level of agility could make your company more responsive to an ever-changing market. The bonus – employees will recognise they are taking a role in their own growth, which translates into growth for the company.

Whether you’re ready to jump into a new system entirely, or hope to evolve your current system into a something more flexible, the trend to shift the performance process itself is an expression of a larger need for change: a recognition that our staff are partners in prosperity. When everyone is collaborating to succeed, the possibilities are endless.

The post Upgrading Performance Management Processes appeared first on Cognology.

We’ve all seen it. Everyone in the team is working flat out, their eyes fixed on an impending deadline they can’t miss. Everyone that is, except one. This individual may be working just as hard as the others, or they may be actively disengaged, but their failure to meet defined deadlines is dragging down the rest of the team.

At this point, most managers call a team meeting. Rather than singling out the underachiever, they address the whole team, hammering home the importance of meeting deadlines. That’s a kick in the teeth for those who gave it everything to deliver on time – and you can bet your last dollar they know exactly who the conversation is targeting. The obvious solution is to go directly to the source and tackle the problem one-on-one. So, why isn’t that our go-to response?

Why do managers avoid one-on-one conversations?

“From an evolutionary standpoint, it is natural to do things that make people like you. It enhances your chances of survival. Yet to be a good CEO, in order to be liked in the long run, you must do many things that will upset people in the short run.”

– The Hard Thing About Hard Things by Ben Horowitz

We all like to be liked. However, as leaders (and I don’t believe this is exclusive to CEOs), it is a mistake to put this natural desire above the needs of our teams.

A one-on-one conversation may be unpleasant – and potentially damaging to your personal relationship with an individual – but by putting it off, you are failing in your role as a leader. In fact, a 2010 study found that every crucial conversation managers avoid costs businesses an average of 8 hours of productivity and US$1500¹. To put it simply, we can’t always afford to be liked.

Mindful managers are good managers

There is a lot riding on your ability to manage an underperformer. Studies have shown that supportive leadership and a high quality team climate have a significant impact on individual morale, helping to protect employees from work-related stress².

Great managers are mindful of the impulse to avoid a difficult situation, but they don’t let it stop them from addressing the problem and finding a solution.

Getting to the root of the problem

“We need people who will give us feedback. That’s how we improve.”

– Bill Gates.

Poor performance and missed deadlines are caused by many issues. A lack of ability and a lack of motivation are two of the most common. However, misunderstandings and poorly defined expectations are just as likely.

Regular readers will know I’m a huge fan of SMART goals. Sustainable, Measurable, Attainable, Relevant, and Time-bound, these objectives make it clear to an individual what is expected and how they can achieve it. If employees are missing deadlines because of a lack of skills, poor organisation, or unclear expectations, then setting SMART goals is a great way to identify and address the problem.

How to deliver constructive feedback

One-on-one conversations can be stressful, particularly if an individual knows they are failing to meet expectations. I have addressed the issue of reducing stress in feedback conversations before, here are the key takeaways:

Include emotions: Linking feedback to your emotions increases its impact. ‘When you do x, I feel y.’
Reduce the threat: Individuals who are concerned about job security, your personal opinion, and their status can feel threatened. Make sure feedback conversations are two-sided and plan ahead to reduce these threats. Give the individual a chance to evaluate their own performance and devise a solution together.
Be fair: An employee who consistently underperforms can be frustrating, but it is important to exclude your personal opinions from feedback conversations. Base your comments on facts rather than assumptions so individuals can see that your assessment is fair and unbiased.
Focus on the future: Yesterday’s missed deadline is in the past. Keep performance conversations forward-focused and ensure individuals have the tools and support they need to deliver on their next objective.

The role of performance management

Performance management must be ongoing and integrated into workflows. These one-on-ones are not one-offs, and are just as important for star performers as underachievers.

All employees need a sense of purpose, and performance management is key to aligning individuals with organisational goals. Clear direction at every level increases creativity, organisational performance, and individual engagement.

Meeting one-on-one with team members gives them a chance to be heard. This means you can stay abreast of any potential performance issues at an individual and team level, and address them before deadlines are missed.

That said, you can have too much of a good thing. Those of you who caught my article on the science of feedback will know that monthly feedback strikes the right balance between overloading and underwhelming employees. In fact, detailed monthly feedback on areas of weakness was shown to improve individual performance by as much as 46% (if you missed that article, now is the perfect time to check it out).

To Sum Up…

Individuals who consistently miss deadlines are detrimental to the health of your team and organisational growth. The only solution for managers is to address the problem head on. If we want to avoid cynicism within the team, reductions in individual morale, increases in employee turnover, and reduced organisational performance, we need to overcome our personal distaste for difficult conversations and provide employees with the feedback they need to improve.

References

¹Maxfield, B., 2010. Cost of conflict: why science is killing your bottom line. VitalSmarts

²Deakin University, 2016. A manager’s role in the risk management of workplace stress. Deakin University

The post Management Mistakes 101: Managing Missed Deadlines appeared first on Cognology.

Those of you who caught my October article on Upgrading Performance Management will be familiar with the trends and changes that shook up the field in 2016. Since Human Resources is constantly evolving, I thought I’d give you a jump on your 2017 planning with a quick run down of the three studies that, for me, turned up some of the most important insights into our field this year.

The Impact of Performance Management on Performance in Public Organizations: A Meta-Analysis.

Methodology:

If you want an overview of how performance management (PM) works across different organisations, a meta-analysis is the way to go. The authors looked at data from 49 studies evaluating PM in the public sector to see what worked, what didn’t, and where improvements can be made.

Key Findings:

To measure their effectiveness, the report graded the 49 individual studies on everything from data collection to performance management structure. Now, we’re managers not academics, so not every measure is of interest to us. However, if we focus on the assessments of benchmarking (its absence, limits, and structure), performance measures, and feedback; we unearth some valuable insight.

Top of the list, measuring performance doesn’t improve it. That’s not to say it’s time to ditch the performance metrics, but it does mean we can’t let them drive our performance management systems.

What this analysis shows us is that PM success hinges on management. Systems with a dedicated performance leadership team, that provided regular actionable feedback, increased organisational performance by as much as three times that of systems that simply measured objectives. Interestingly, organisations that used benchmarking to rank employee performance also performed better, probably because leaders could see who was learning well and tailor their approach to individual needs.

Top Takeaways:

Management practices have a significant impact on the effectiveness of PM practices.
Managing performance is more important than measuring it.
PM systems with poor benchmarking are associated with lower performance.

Full study available from: http://onlinelibrary.wiley.com/doi/10.1111/puar.12433/full

When Employee Performance Management Affects Individual Innovation in Public Organisations: The Role of Consistency and LMX.

Firstly, let’s address the concept of ‘LMX’. An abbreviation of Leader-Member Exchange, it is basically a description of the relationship an individual has with their line manager, a relationship that impacts their experience of management and PM practices. High LMX means employees will experience management as supportive rather than controlling.

Methodology:

This study took a detailed look at the working environment of 1095 caregivers in 68 care homes across Belgium. The data was collected with self-assessed questionnaires, and workers asked to grade performance management, LMX, and individual innovation on scales designed for each variable.

(For those of you who are wondering, ‘individual innovation’ in this study refers to the tendency of workers to generate and implement new ideas).

Key Findings:

The long and short of it? Continuous monitoring and feedback in an environment where leaders and employees trust and respect each other leads to great LMX, and drives organisational performance by allowing individuals to innovate and improve workflows.

A word of warning: new employees were found to experience higher LMX than their long-serving counterparts. So don’t overlook those individuals who’ve got their roles down – good performance management practices are just as important to them, arguably more so since it encourages individual innovation.

Top Takeaways:

LMX has the biggest influence on employee perceptions of performance management practices.
Great LMX creates high performing employees with a strong inclination to innovate and improve services.
The best performance management systems are on-going, consistent, and personable.
Employers have a tendency to undervalue the importance of performance management to long-serving employees.

Full study available from: www.researchgate.net/M_Audenaert

Do Similarities or Differences Between CEO Leadership and Organizational Culture Have A More Positive Effect on Firm Performance? A Test of Competing Predictions.

Methodology:

The authors of this study set out to quantify the interaction between the CEO, organisational culture, and performance. They collected data from 119 CEOs in the software and hardware industries, and 337 members of their top management teams (TMT – think board executives). The TMT rated CEO leadership, the CEO and TMT rated organisational culture, and the unbiased Technology Consortium provided an objective measure of company performance.

Key Findings:

As the captain of the ship, the CEO’s impact on performance is multifaceted and far reaching. It is not, however, a case of one-size-fits-all. CEO behaviours that reduce performance in one organisation optimise it in another – and it’s organisational culture that determines which.

There are two prevailing theories on this phenomena. The first is Similarity Theory, and it states that leaders who align their actions with organisational values send out a unified message to staff. Theoretically, these consistent cues drive everyone towards the same objectives and enhance performance.

The alternative is Dissimilarity Theory, which suggests that leaders mirroring organisational values create redundancies. Rather than parroting the same values, CEOs take a contrasting approach, providing the support and frameworks missing from the organisational culture.

The findings of this study suggest Dissimilarity Theory best describes the interaction between CEO behaviour, culture, and performance. Organisations where social interactions were not valued, were seen to benefit from CEOs with strong interpersonal skills and a social focus. Businesses that lacked strong performance-based goals performed better under results-driven leaders.

Top Takeaways:

CEO leadership behaviour has a significant impact on organisational performance.
The interaction between CEO leadership and company culture has a critical impact on performance.
CEOs are most effective when they provide the support missing from the organisational culture.

Study available from: www.researchgate.net/Patricia_Corner

To Sum Up…

What these three studies (and the host of others published on their heels) demonstrate is that, as an industry, we’ve still got a lot to learn about how our employees, leaders, and organisations interact with each other.

With each year we gain more valuable, actionable insight. It’s up to us as managers and leaders to make the most of it, optimising our performance management systems to create processes that deliver tangible results at an individual, team, and organisational level.

References

Organisations that implement regular performance feedback have 15% lower turnover rates than those that don’t. Source.
43% of highly engaged employees receive regular feedback. Source.
80% of millennials say they prefer on-the-spot recognition over formal reviews. Source.

The post Top Research Takeaways of 2016: Performance Management appeared first on Cognology.

In my last article, I gave a run-down of three talent management trends that I thought would be particularly influential in the new year. Though I briefly summed up my thoughts on each one, I’d now like to go in-depth on performance management (PM).

Across public, private, and government sectors, elite organisations share a common understanding: performance management is what fosters employee excellence. It’s what makes a good organisation into a great organisation.

So, needless to say, I think it’s worth doing a deep-dive when it comes to the study of performance management. Which is where an important article, “The Impact of Performance Management on Performance in Public Organisations: A Meta-Analysis,” comes in. Published in the Public Administration Review by Ed Gerrish, Ph.D., it offers us some valuable insights into separating the wheat from the chaff when it comes to maximising effectiveness of PM processes.

Dr. Gerrish saved us a lot of reading by reviewing 49 studies of performance management and synthesising the results with what’s known as a “meta-analysis.” His findings are conclusive and critical to any successful organisation: the efficacy of PM is entirely dependent on the system used to institute it.

Keys to success in performance management

1. Simply measuring isn’t enough

Don’t just measure performance. Treat your data as actionable intelligence. We’ve all been involved with stagnated organisations that simply “go through the motions.” They usually don’t last very long. In the case of PM, this might mean tracking performance, but only taking superficial measures to correct problems. That’s not going to cut it. Measuring performance without managing performance has a negligible effect.

Performance measurement works best when integrated with best practices and strong organisational culture. Important steps include clear – and clearly stated – goals, using performance data as a basis for strategic planning, and incentivising strong performance. Gerrish’s meta-analysis shows just how important best practices are when it comes to PM: organisations tying those best practices into PM are up to three times more effective than “average” PM systems.

2. Benchmark your way to success

One technique that the analysis shows to be quite effective is benchmarking – comparing performance to industry leaders and ensuring year-over-year improvement. I’ve long been a believer in benchmarking, and have seen employees, teams, or entire departments re-energised when given a clearly stated goal. It’s also a clear way to identify both high-performers and underachievers – a logical starting point in performance management.

With an appropriate frame of reference, outstanding employees can be properly acknowledged and rewarded and under-performers can be correctively trained to improve their performance. On a larger scale, departmental budgets or autonomy can be tied directly to clear benchmarks so that teams know exactly what is expected of them.

One example of where benchmarking works as a determinant of budgeting is in local government. A comprehensive study of over 300 county and city governments in the US found that the “greatest applicability” of PM through benchmarking is during budget development.

3. Survival of the fittest PM

Organizations are subject to the same Darwinian laws as living organisms. As a result, they are constantly adapting to survive and thrive in their environment. Performance management systems are one of the most important tools an organization can use to survive change. This is why “Second-generation” PM systems, defined by Gerrish as those which have been in place for longer than two years and are significantly different from their first-generation predecessor, can make or break an organization.

The most effective second-generation PM systems are those that do more than pick low-hanging fruits. A key to success is thinking proactively. It’s easier to build a fireproof house than put out a fire. For instance, if an organization recognizes that a department is underperforming, it’s not enough to cut funding. A first gen PM system might recognize a problem. That’s good. But a second gen PM system should both recognize, react to, and safeguard against future problems.

Xerox, the American copier manufacturer, saw its stock plummet from $70 to $5 a share within 18 months at the turn of the century. Looking overseas at Japanese competitors, Xerox found that their product took twice as long to produce and at three times the cost. With the help of an outside consulting firm, Xerox was able to make real structural changes that have sustained them in the 21st century like just-in-time inventory, quality control improvements, and emphasis on leadership training.

Using PM systems and benchmarking, Xerox identified the areas they were failing in. As an established firm, Xerox certainly had second gen PM systems. These systems were then used as a launching point to react to shortcomings and make strategic decisions that would prevent the organization from repeating its mistakes.

The right way to manage performance

Be mindful of the following steps to keep your organisation on track:

Remember that measuring is only the first step – there’s no benefit to gathering data if it doesn’t lead to action. A strong management team will use performance measurement to start moving in the right direction. Your stakeholders want results, not a case study.
Put everyone on the same page with benchmarking – it’s easier to communicate when everyone is speaking the same language and understands where they stand in comparison to their peers. Differentiate high- and low-performers and make corrections accordingly.
Be aware that PM systems change with time – identify ways that your second-generation PM system is different. Did you make necessary and proactive changes or just react to immediate problems by picking low-hanging fruit?
Step outside of your organisation for a new perspective – there’s more than one way to skin a cat. Oftentimes solutions can come from an entirely different field or industry. Don’t fall into the trap of “this is how we do it because this is how we’ve always done it.”

If you’re a leader hoping to spur change in your organisation measuring and benchmarking can be effective tools, but they’re powerless until you’re ready to follow them up with necessary heavy lifting. Put data to work for you, don’t be afraid to see how you stack up to the competition, and don’t be reactive. Be proactive.

Performance Management can be hard without systems and experience. Let us help.

The post New research into performance management in public organisations appeared first on Cognology.

I’ve started something new to help our readers learn about leadership and people management. It’s based on a concept called the Pareto principle or 80/20 rule. This rule states that for many events, roughly 80% of the effects come from 20% of the causes.

Pareto Principle infographic
My aim is to apply this principle to articles so that you get a high return on investment from a minimal amount of reading. I’ll do this by focussing on the most important information without the extraneous explanation. Here’s the first two posts I wrote based on this idea.

1. An Exceptional Person Has Arrived On My Team. What Do I Do Next?
2. How Do I Onboard Someone Into My Team?

The new Pareto Posts will focus on sharing my more than 20 years’ experience in leadership and people management. They’ll be a great compliment to our more detailed research based articles which we will continue.

The post 80% Value and 20% Reading appeared first on Cognology.

How technology impacts the performance management approach: Validated findings

How technology impacts the overall effectiveness of performance management: Validated findings

How technology impacts performance management for remote workforces: Validated findings

How technology impacts business-critical strategy: Validated findings

In conclusion

A quick introduction to the Intergenerational Report

What will the Australian workforce look like in 2055?

Why an older workforce makes Agile Performance Management even more critical

In conclusion

The key benefits of a sense of purpose

In conclusion

Cognology data shows:

49 quotes on the power of feedback

1. Shawn Achor: The happy secret to better work

2. Dan Pink: The puzzle of motivation

3. Dan Ariely: What makes us feel good about our work

4. Julian Treasure: How to speak so that people want to listen

5. Simon Sinek: Why good leaders make you feel safe

6. Drew Dudley: Everyday leadership

7. Margaret Heffernan: Dare to disagree

8. Matt Cutts: Try something new for 30 days

9. Laura Trice: Remember to say thank you

10. Richard St. John: Success is a continuous journey

One: Measurement is suffering from an image problem

Two: Hard work without measurement is folly

Three: Measurement creates the right circumstances for leaders to lead

Four: The problem is never the measurement – it’s how humans use the data

In conclusion

What happens when managers give feedback, without reference to expectations

What happens when employees don’t get enough feedback

And now, finally, what happens when you have clear expectations and ongoing feedback…

The old model

The new model

In conclusion:

Reference:

It’s a Brave New World

The Changing Face of Employment

So what are the benefits of freelancing for freelancers?

What are the benefits of hiring freelancers for employers?

Are There Still Benefits of Permanent Employment?

What is the Future of Work?

Is there a case for change?

New Talent Pool Demands New Solutions

Rebranding ratings

Ensuring Evaluations Remain Fair

Enhancing Performance Ratings with Real Time Feedback

Conclusion

References

To Sum Up…

References

Clinton

Trump

The Reasons Behind Poor Performance

Managing Poor Performers

Training and Coaching

Setting SMART Goals

Addressing the Impact on Team Members

Knowing When to Quit

To Sum Up…

References

The Trends

Building With Trust

Monitor Change

Is Your Performance System Due for an Upgrade?

Why do managers avoid one-on-one conversations?

Mindful managers are good managers

Getting to the root of the problem

How to deliver constructive feedback

The role of performance management

To Sum Up…

References

The Impact of Performance Management on Performance in Public Organizations: A Meta-Analysis.

When Employee Performance Management Affects Individual Innovation in Public Organisations: The Role of Consistency and LMX.

Do Similarities or Differences Between CEO Leadership and Organizational Culture Have A More Positive Effect on Firm Performance? A Test of Competing Predictions.

To Sum Up…

References

Keys to success in performance management

The right way to manage performance

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