Re-Imagining Performance Management

What's your organisational vision for implementing performance management? 

My vision for my clients is that they have a performance management process that drives the right performance at the right level. 

What Does Right Performance at Right Level Mean?

Roles are designed to deliver a certain level of outputs and/or outcomes.  For example, a salesperson is charged with bringing in X value of sales while the sales manager is charged with managing a team of sales people to bring in Y value of sales. 

These two roles require different knowledge, skill sets, mindset and experience.  If the sales manager does the role of the sales person, your business is paying double plus a premium for some tasks while some tasks are ignored. 

Your performance management process should, in the first instance, guide each employee to perform the role they're actually in, not some role they'd like to be in.

If everyone performed well in their own role, what would that do to your business' performance?

If you can sense the value this would bring your business, it's time to talk. 

I recently asked a group of 20+ managers who had a clear picture of what "good" looked like for the roles they managed....ZERO people put their hands up.

With over 20+ years experience of designing performance management processes and training managers and employees alike, I can assure you those people are in the vast majority, not the minority.

The reality is...there is a very high probability that your managers don't have a clue how to develop their people.

Does it matter to the business that managers don't have clarity?

For a lot of industries, salaries is their biggest cost.  So every employee in every role has to deliver value of at least their salary costs.  If they don't, they are costing you money.  If the people charged with developing and managing employee performance i.e., your managers, don't know how to unlock that value, your business is underperforming.

If you suspect this describes your managers, it's time to talk.

On what performance do you pay bonuses and award pay rises?

Current performance management theory suggests evaluating a person's performance ONLY against objectives, and ignore overall role performance. So some people focus on delivering objectives, at expense of overall job performance.  

A regular complaint is that a person did well in their objectives so they feel they can't say anything about the bits of their role they ignore.  Either those tasks need to be done or they don't.

It's worth a minute reflecting on how this plays out in your own company.

Does parts of roles not being done matter?

Yes, it matters!  If tasks that no longer need to be done, why require them to be done and what other tasks no longer need to be done?  In this case, its time for an organisational design review, to streamline processes and update job descriptions.

The more likely scenario is someone else is picking up the tasks, which brings us back to our belief, namely right work at right levels.

Performance management exists to maximise your most valuable resource - your people.   

I am literally writing the book on what is wrong with the current approach to performance ratings.  I give them a 1 out of 5 i.e., very poor performance!

A common question managers get is:  what do I need to do, to get a 5?

The typical answer from managers is: I don't know!

Another scenario is telling one person, whose been in their role for 5 years, they're unsatisfactory (we'll call it a 2) and telling the person sitting beside them, whose 6 months in their role, that they too are a 2.  It's not quite that they're unsatisfactory but the message is the same.   

Is there an alternative approach to performance ratings?

Irial has devised a much more nuanced rating system, which allows very different conversations to take place.  It tells the poor performer that yes, there is a performance issue; while telling the new person that they're still in learning mode but they're on the right track.  They are two totally different messages. 

If you want equip your managers to be able to have more nuanced performance conversations with their teams, it's time to talk.