In Part 1 of this post, we looked at what should be the purpose of your Performance Management(PM). If the core purpose of PM is beyond annual Performance Measurement, keep reading. If you think that process of performance management can be one of those interventions that can help you to achieve higher levels of productivity and performance at the organization, congratulations you are able to realize the potential of PM. At qilo, we call this new potential of PM as Performance Enablement.
Just think of your organization as a machine, a well define PM process can help you to enhance the accountability on running those parts of machine smoothly and helps you to visualize how those parts are working with each other.
Let’s look at how the 3 core processes involved in traditional PM processes can be reinvented:
- Re-inventing the Goal Setting
- Re-inventing Manager / Employee Conversations(1-On-1’s)
- Re-inventing the Acknowledgement and Feedback
Re-inventing the goal setting
The traditional approach to goal setting is to define the goals & KPI’s with respect to roles people play in the company. During the annual ritual of PM process, every person in the organization tries to prove that they have moved beyond what the KPI’s are stating. Here are the flaws of traditional goal setting process :
- Goals are too longish in nature that it’s difficult to remain focused on them. By the time you finish define the goal, because of the dynamics of the business environment, goal post changes.
- The KPI achievement is rating and perception driven NOT data driven. Per Phycology Today, humans tend to lie about their performance.
- Defining KPI weightages add to more confusion and doesn’t help an employee to judge where she should spend her time.
- KPI’s itself are too subjective in nature defined in a complex way that a normal person can’t understand it.
- Most of the KPI’s are lag indicators and are not combined with the lead indicators which can tell us more story on why its not achieved what you are supposed to achieve.
- Word matter. Pick up any goal or KPI statement, most of them are hardly motivating that a person feels like chasing those.
The new way of goal setting should be Agile in nature and should focus on:
- Shorter duration goals (monthly or quarterly) backed by the action plan on how that goal will be achieved. The action plan will reduce the subjectivity involved.
- The progress on action plan should be updated on the weekly or monthly basis, which will help reflect how the person is going on the goal, and whether it will be achieved or not.
- Each goal should be linked to the overall company objectives thus giving visibility to the leadership on how the company is performing on strategic and operations priorities.
While the advantages of setting the Agile goal process are enormous, implementing the agile process at scale need a high level of discipline within the company. The success of implementing the new way highly depends on the content(which means goals and its action plan) which goes into the system. Otherwise , the new way will also face the same challenges of traditional way which lacks adoption by people.
Re-inventing Manager / Employee Conversations(1-On-1’s)
While the manager-employee conversation is the core to enable employee evolution, most companies don’t know how to facilitate this in right way. In the traditional way of PM, the formal performance discussion between the employee and manager leads to manager justifying the rating given to employee. The successful implementation of manager and employee conversation starts with
- Training managers on how to conduct a conversation and give feedback to the employee on how to be more productive and perform better.
- Give the context to the conversation which forces the open-ended discussions between employee and manager.
- Collect data points from the discussion to check at company level how conversation are going and how managers are leading these conversations.
- Combine this process of discussion with the Agile process of goal setting so that manager and employee have the conversation about goal progress.
Re-inventing Acknowledgement and Feedback
At the time when you give feedback to your Uber driver by the time you are out of your cab, feedback to an employee is given once a year. Feedback and acknowledgment of the work should be continuous & real time. While setting up the 1-On-1 process and conducting in quarterly will help you to re-invent the wheel of feedback, what if someone has to give feedback to someone after the meeting or a product launch or after a particular event in the company.
The data generated from the agile goal process, 1-On-1 and continuous feedback should generate enough data for you to help understand how your culture, people, and metrics are performing. And as Ray Dalio, famous CEO of Bridgewater Consultants and author of the book Principles says
“If you can’t visualize how your culture, your people, and your metrics are performing, you will inevitably fail to realize your organization potentials and growth”