How many organisations in today's environment have implemented elaborate performance management systems with the best intentions in the world, only to have them slip into mindless bureaucratic exercises. How many HR Executives can hold their hands up and be able to tangibly quantify the impact of such systems in:
- Improving behaviour and hence performance;
- Identifying developmental needs;
- Rewarding achievement and positive behaviour;
- Retaining talent;
- Identifying and acting against poor performance.
In many organisations today, Performance Management Systems have tended to become more of a bureaucratic exercise, driven by HR departments that are desperate to get personnel files up to date before the next quality audit. Operational managers, overworked as it is, don't have the time to mentor their employees, let alone have much needed discussions about performance and career progression that is critical if organisations are going maximise their return on their Human Capital investment.
Why Do They Fail?
In our experience, it would appear that many of these failures are as a result of a number of factors, not least of which is:
- Paperwork is over elaborate and complex, and is often not understood by either employee or manager;
- Paperwork is tedious and takes time to complete and so the process gets procrastinated;
- Many managers are uncomfortable with the "softer" side of management and sub-consciously avoid one on one interactions that may result in either conflict or praise;
- Performance Reviews are too far apart, and the link between the performance itself and the review is lost rendering the discussion ineffective or meaningless;
- There are few, if any, action plans that emerge out of the system that provide for corrective action, training, career development plans or even rewards.
Whether or not Performance Management is taken seriously is a cultural issue. Corporate culture embeds itself into an organisation and is difficult to change. It impacts on almost every activity, process and outcome. If Performance Management is not being taken seriously or doesn't exist at all, the change process is going to more difficult than the re-design.
Key Principles
There are however some principles that can be followed that will make the take up of the process smoother. Let's briefly look at these:
1. Keep It Simple.
What do I need to do, and to what level or standard? This is the basic information that an employee needs to know to ensure his focus for the period in question. A set of 10 Key Performance Indicators is probably the maximum that an average Performance Agreement should contain.
2. Keep It Behavioural.
Performance, good or bad, is always a symptom of conditioned behaviour. By defining the behaviours necessary for positive individual and organisational growth, and measuring these on a 3600 basis, the organisation has a strong chance of building a strong performance oriented culture.
3. Keep It Frequent.
Yearly performance reviews are far too infrequent, as are half yearly reviews. If the system is simple to measure, monthly is ideal, quarterly at the outside.
4. Keep It Short.
The more frequent the review the quicker they can be. Half an hour per review should be manageable if the employee and manager are engaging frequently. Thus the review becomes a confirmation of what has already been discussed.
5. Keep It Automated.
Automated performance management systems are relatively inexpensive and there are many that are available that allow for ease of completion, measurement and storage, thereby alleviating the managers and staff from the concomitant buraucracy.
6. Keep It with the Appraisee.
Pushing accountability down is a key to superior performance. By making employees responsible for their own reviews ensures that it gets done. An effective performance review should have as its first step a self-appraisal by the employee. This should be followed by a counter review by the manager and completed with a brief discussion between both. Not only does this take the onus away from operational managers to drive the process, it also sensitises staff early in their careers that performance management is very much part of the culture of the company.
Building a Performance Management Culture
Having set the principles, how do we set about establishing a Performance Management culture, one that becomes part of the DNA of the organisation. In order to do this lets digress for a minute and understand what we mean by a Performance Management culture. The best way to evaluate our culture is to look at some of the habits that exist in the organisation that we do but don't think about. For example:
- Do meetings start religiously at the times specified with all attendees present, or do they frequently start 10 to 15 minutes late with little, if any, consequence?
- How are deadlines treated? Are they frequently missed with no recourse or are they sacrosanct?
- Who has access to whom? Can anyone walk into anyone's office regardless of position and reporting lines or is there a defined but unwritten etiquette regarding who talks to whom?
- What is the "un-stated" dress code? How loosely is the stated dress code interpreted? If ties are mandatory, are they worn neatly and tight around the neck or is a loosely worn accepted as "the way we do things around here".
- In organisations that have a strong Performance Management culture,
- Performance Reviews are completed on time and without question;
- Performance discussions are pertinent to staff growth and productive;
- Staff actively manage their own career growth and development;
- Managers do not shy away from hard discussions;
- Day to day engagement between managers and staff is the norm;
- There is a strong focus on behaviours as well as KPI's.
The indications are there, that if performance management systems are going to take root, management needs to commit to making a cultural change throughout the organisation. All management and staff must be able to embrace this as part of their day to day behaviour. Behaviour in turn requires individual awareness, commitment and measurement. This implies that management must believe in the process, embrace it, and have the patience and resilience to push through its implementation until it takes on a life of its own. Such a process has set of specific phases through which there are no shortcuts.
Phase 1: Awareness
There is nothing more liberating than for a management team to be able to self-reflect on their behaviour as individuals and culture as an organisation. If they are aware of what self-limiting beliefs are holding them back, they are free to begin the process of performance change. It is at this point they ask critical questions about their current performance levels, the impact of their behaviours and what commitments they are prepared to make to change. This process needs to start at top management, and is conducted in the form of a series of workshops in which honest conversations are held.
Phase 2: Visioning
Having appreciated where they are, they now need to decide where they see themselves. By now management should have matured to the point of being able to hold mature discussions about what the future looks like, do they have a value proposition that guides the organisation, and what behaviours will support this. It is only then that a working Performance Management System can be designed.
Phase 3: Buy-In
Once solidified at management level, the most critical part of the process begins. Change consultants love to use colourful and high impact launch parties and road shows to get staff's attention. This is not enough to gain credibility or change behaviour. Staff will quickly see through the smoke and mirrors and return to normal behaviour mode when back in the workplace. The most credible form of successful change initiation is for managers to engage staff within their work environment, either one on one or in small groups. This will need to be followed up by action, but staff need to see that there immediate superior is supportive of the process. Part of the buy-in process is to ensure that staff are able to dialogue and understand both the KPI's and behaviours that need to measured and why. This can't happen in a large forum, no matter how many special effects are used.
Phase 4: Implementation
Implementation implies one-on-one sessions from top to bottom to agree Performance Contracts. It implies stretch but achievable targets are set and agreed by both manager and staff member. It implies that Performance Reviews are conducted at the agreed intervals and are not late. It implies that these reviews are taken seriously and not paid lip service to. It also implies that the consequences of performance, good and bad, must be realised and must be consistent. When staff see that the new, much talked about, process is being implemented and adhered to, the process has a much greater chance of taking traction later on.
There will be natural resistance. Culture has an automatic push back mechanism to new processes, much like a body may reject a new organ part. But like that new organ, once the process becomes a natural and essential part of the life of the organisation, it will gradually become part of the culture that sought to reject it initially.
Phase 5: Reinforcement
Like any new process, a good Performance Management System requires frequent review itself. Some managers will embrace the process more than others. Some staff will be more resistant than others.
There may even be some fallout as long standing employees leave, or threaten to leave, as their performance, for so long hidden behind their lack of accountability, is finally in the spotlight.
It is important that management shows resilience in the process, and rather take whatever corrective steps are necessary, than can the process completely, or worse still, allow it to slip back into the meaningless bureaucratic quagmire that it was rescued from.
Conclusion
Like nay new process or system, Performance Management Systems have as much to do with cultural acceptance as they do with adhering to sound principles. Introducing a new Performance Management system, or revamping an existing one, requires patience and commitment from all levels in the organisation, but particularly from leadership and management.
The Author
Bernard Koch is a Management Consultant, Motivational Facilitator and Executive Coach with a specific emphasis on Culture Transformation and Sustainable Behaviour Change at both an individual and team level. He has developed his thinking, processes and methodology over 25 years in business. He has operated at Managing Director level, as the Senior Manager of a large well known Managing Consulting Firm, and more recently as a Shareholder and Director in charge of shared services for a large Civil Engineering Consulting firm. Bernard's approach is based on two truisms: that culture drives performance, and that leadership influences culture.
Bernard is currently the Executive responsible for Human Capital Solutions at LabourNet.
