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COMPENSATION & REWARDS
Jun 22, 2015

Helping performance management get its groove back

Don’t get fixated on forms and scales – the dialogue is what really counts
    

By Claudine Kapel

It’s hip to disparage performance management.

But getting too caught up in the drama and debate may mean missing out on the opportunity to make the process more meaningful.

Some organizations focus on trying to fix performance management by improving the tools of the trade – making forms more user friendly, introducing technology to ease paperwork and administration, and defining rating scales more clearly.

While all these steps can add value, none of these actions alone can resolve the most fundamental area of malaise: the quality – or lack thereof – of performance-related discussions.

Detractors of performance management sometimes get fixated on the amount of paperwork involved, the challenges associated with determining performance ratings, and the vagaries of linking performance and rewards.

But ultimately, what matters most is the quality of the conversations that arise day-to-day as managers and leaders guide employees so they can make optimal contributions to the achievement of organizational objectives.

A new study by BlessingWhite presents a litany of performance management shortcomings, but also highlights the overarching importance of performance conversations. The study features responses from 1,600 individuals in manager and individual contributor roles.

BlessingWhite offers what for many is a familiar list of the shortcomings of performance management practices:

• The process is very bureaucratic

• Performance conversations are unproductive

• The conversations are backward-looking

• Scoring and assessments are subjective

• The process creates competition among employees

• Executives have little faith in the process.

And as with most debates about performance management, BlessingWhite declares that “old-school performance management has become an anachronism.”

But at the same time, it notes “the core concept of managing performance remains critical. Organizations are keen to find a better alternative that allows them to remain nimble while keeping a firm grip on performance levels.”

Curiously, while the BlessingWhite study is critical of traditional performance management tools and practices, its research findings show that employees’ perceptions of performance management are, in fact, profoundly shaped by their interactions with their manager.

The report compares the responses of individual contributors who reported receiving regular feedback and coaching from their manager to those who didn’t. A major finding is respondents who received regular feedback and coaching were more positive about a variety of performance management elements than those who didn’t.

 • 73 per cent of those who said they receive coaching and feedback felt their organization’s process is fairly implemented, versus 46 per cent who said they didn’t receive coaching 

• 70 per cent of those who said they receive coaching and feedback indicated the process gave them insights for improving their own performance, versus 33 per cent who said they didn’t receive coaching

• 56 per cent of those who said they receive coaching and feedback felt their organization’s process accurately measures individual performance, versus 25 per cent who said they didn’t receive coaching.

On the flip slide, only 11 per cent of those who reported receiving coaching and feedback felt salary decisions seem arbitrary, versus 30 per cent of those not receiving coaching. Interestingly, these results suggest performance ratings and links to pay aren’t the bugaboo many people believe them to be.

As BlessingWhite concludes: “Performance management approaches are only as effective as the dialogue that takes place in and around them.” It notes that only 56 per cent of survey respondents reported receiving regular feedback or performance coaching throughout the year.

So the real solution to what ails performance management may be to stop getting so hung up on the tools and process and instead, focus more on eliciting the desired outcome – productive performance conversations.

It’s equally important to recognize that this outcome is more a function of management capability and commitment than anything else. New forms, new technology, and new ways to rate employees won’t get an organization where it wants to go without leaders and managers being willing and able to have meaningful performance conversations – including the difficult ones.

    
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