Energizing Employee Performance ManagementActive user involvement is imperative The team must be...

WINNER of Microsoft Code For

Honor 2014 Large Enterprise Software

Best Human Capital / Talent

Management Solution

Performance Management

Employee Engagement

Employee Development

Energizing Employee Performance Management: How two companies are disrupting the status quo and shifting from dread to cred!

Agile Performance Management

Tracy McCarthy | EVP, Human Resources

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Synergita.com www.savogroup.com

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Poll QuestionHow many of you are dissatisfied with your current performance management process?

a) Satisfied b) Dissatisfied c) Not Sure

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Traditional Annual Process

Inconsistent goal setting and development planning

Review scores were the key driver of pay increases

Dread

Pulling Teeth

We need to disrupt the status quo….

SAVO Journey – Where We Began…

Disengagement

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Business was going through tremendous change

– New PE firm investment

– New senior leadership

– New software

development

methodology

– Several restructures

– Higher than normal

turnover and

engagement scores

quickly declining

– Change fatigue

Might as well change this process too!

Business in Transformation

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Software Development Methodology

Two primary methods of software development

Waterfall – Top down driven, long timelines, little flexibility

Agile – the opposite!

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Key Agile Concepts

Active user involvement is imperative

The team must be empowered to make decisions

Small incremental releases and iterations

Testing and feedback is integrated throughout the process – early and often

Collaboration and cooperation between all stakeholders is imperative

Service-based leadership style is critical

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The Connection & The Shift

Performance Management is a process

Performance Management is traditionally waterfall

Performance Management is not usually very successful at quick iterations and change

Focus on three key aspects of agile

We want to drive continuous conversation about future performance and contributions and move away from backward-looking ratings.

Connection Shift

Employee involvement is key –employee’s own their performance and development

Feedback should be frequent and course corrections happen quickly – no more looking back

Capturing requirements should not be a “dreaded chore”

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The Journey Begins February 2015

Transition

Implemented quarterly check in

reviews and a final year end

review

Goal setting that rolls into the

quarterly check in

Buy-in from Sr. Leadership and next level management

Sought feedback from managers and employees about the PM process -Key feedback

More regular performance

discussions vs. system

requirements

More focus on goal setting tied to

department and company goals

Time to talk about individual

development and career growth

Improvement in managers ability

to provide constructive feedback

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Development Discussions:

Forward-looking performance

discussions with continuous

course correcting and support

Shift from one-way feedback to

Asking questions and listening

Focus on giving and seeking

feedback, As well as actively

listening, to encourage reflection

And meaningful dialogue

The HOW is equally important as

The What (tie to SAVO values)

Focus on regular conversations

Not Just once a year or once a

quarter, to Improve effectiveness

and ensure alignment and

development

Agile Performance Development Characteristics and Focus

SAVO People Leaders

Objectives: Realize benefits of increased productivity, improved visibility, flexible to shift priorities and employee growth

Feedback : From circles, managers, peers, directs, teams

Process: Simplified goal setting

And follow up via Talent

Management system

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Poll QuestionDo you think continuous communication or the lack of it can affect employee performance?

a)Yes b)No c)Maybe

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What kept me up

Managers may not embrace failure as a

part of success

Management skill and commitment to

providing meaningful

feedback

Employee perception of

fairness

Employee Retention

How will we apply compensation with no scores?

Epic failure and inability to iterate

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The Journey Continues 2016

January 2016Last formal annual performance review

Turned focus to Goal Setting and forward looking feedback

Quarterly check in to: document progress toward goals course correct when needed and celebrate success document in system of record

Focused skill development for all people managers

1 company goal3-5 individual/team business goals 1-2 personal development Goals

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Lessons Learned

Any PM process is only as

good as your managers

For some it is in their DNA;

some it’s still pulling teeth

The risk of deteriorating

motivation is real

Document progress

Learning to

embrace failure as a

part of success

This was really about

managing change, so

change management skills

are paramount for HR and

LeadersThe process is every evolving

and understanding agile

methodologies is importantCommunicate more

Than You think is

necessary

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Compensation

Base Salary/Pay

Reviewed each year in Q1

Will be based on:

Productivity

Potential and growth;

Position in pay range;

Market competitiveness

Incentive Compensation

Based on achieving company financial and growth goals

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Summary

Performance management is a conversation between a manager and employee where expectations are set and feedback is providedA relationship based on trust & respect between the manager and employee is paramount to the process

Effective feedback is data provided to a person that allows them to choose their behavior going forward

Employees are responsible for his/her career choices and aspirations, and raise his/her needs

It is the manager's role to support that employee in their goals and provide opportunities when possible.

Documentation is critical to hold employees and managers accountable

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Performance & CompensationAt Equity ResidentialChrista Sorenson| EVP, Human Resources

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Synergita.com www.equityapartments.com

30%of performance reviews result in

decreased employee performance.

10 STATISTICS ABOUT PERFORMANCE MANAGEMENT THAT WILL BLOW YOUR MIND.

Talent Management 360. http://www.talentmanagement360.com

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“I have had numerous years when my supervisor has told me that they wanted to give me ‘x’ rating but it had to be lowered to fit into our department’s budget.

I do not believe the end of the year process is a true reflection of my performance.”

- Equity Employee

“The written text of a performance review is helpful.

The scoring is a dishonest joke.”

- Equity Employee

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80%“I receive the feedback I need from

my supervisor to improve my performance.”

Equity Employees

2015 Engagement Survey

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Equity’s New Performance Process

What’s changing:

• All numerical performance ratings for corporate employees have been eliminated.

• We are removing the 1:1 relationship between a final year-end rating and the bonus payout.

What’s staying the same:

• All employees have 3-5 performance goals and one development goal.

• Goals have action items and measurements set at the beginning of the year.

• Performance feedback remains a critical component of employee development and learning. Managers are still expected to provide regular feedback to their employees.

• A written performance review will be completed at the end of the year and will include comments of both employee and manager.

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Poll QuestionCan you fairly determine employee compensation without a performance rating system?

a)Yes b) No c) Maybe

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New Compensation Process

What is changing:

• No year-end rating to determine bonus/ LTC payout.

• Majority of employees will be considered “strong” and will be eligible to receive 100% of bonus/LTC potential.

• A small number (5-10%) may be eligible to receive an upward (more) or downward (less) exception of bonus/LTC potential based on performance results.

What is staying the same:

• Performance is a key factor in determining compensation.

• Market-based with salary ranges, market factors to ensure externally competitive.

• Managers should review employees’ salaries annually to ensure competitiveness.

• Merit matrix will recommend annual increase based on position in range and performance.

• Bonus pool based on Equity’s current financial results and outlook.

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New Incentive Comp Payout Recommendations

Incentive Comp Category DefinitionsEligible Bonus/LTC Potential

PayoutIdeal Distribution*

STRONG PERFORMER

Employee delivered strong consistent

performance against a challenging set of

goals

100% 85%

ExceptionsEligible Bonus/LTC Potential

PayoutIdeal Distribution*

Upwards Exception

• Significant measureable results achieved

against a challenging set of goals110% or more 10%

Downwards Exception

• Developing Proficiency / Missed Objective

OR

• Under Achieved on Multiple Objectives or

Major Miss

90% or less 5%

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Calibrating Exceptions

Incentive Comp

CategoryPerformance Results

Strong Performer

Eligible to receive

100% of Bonus/LTC

Potential

• Delivered consistently on most/all objectives

• Demonstrated 10 Ways behavior

• Valued performer

“Strong performer; we don’t want to lose this person.”

Upwards Exception

Eligible to receive

110% or more of

Bonus/LTC Potential

In addition to above, clearly distinguished himself/herself through:

• Impressive results on a significant company-wide or department-wide project over and

beyond the normal workload, or

• Picked up significant workload for an extended period of time beyond usual workload, or

• Created significant, new, one-time contribution of value for the company

“It’s obvious – this person out-performed.”

Downwards Exception

Eligible to receive

90% or less of

Bonus/LTC Potential

• Delivered on some, but not all objectives or demonstrated behavioral/attitude challenges

“Faced challenges, but will likely pull out of this and be a strong performer next year.”

OR

• Did not deliver on a number of objectives (poor quality, missed deadlines) or demonstrated

serious behavioral/attitude challenges

“Really struggling; unlikely to make it long term.”

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The Big Concern

• Many of our employees were accustomed to consistently

getting more than 100% of their bonus due to high

performance ratings and now, most will only earn 100%

• The intent of this program was not to be a cost cutting

measure.

• Therefore, a 3-year historical payout average was applied to

incentive targets and/or salary (one-time adjustment) for all

participants to ensure zero negative impact on employee

compensation.

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Key Learnings

• Our company history/data was saying that we weren't effectively paying for performance- we needed to let go of the belief that we were

• The most significant pain points- wasted time and energy of the managers and de-motivation of the employees helped us sell the changes.

• We involved senior leaders early and often throughout the process so that they have ownership (not an “HR initiative”)

• We ensured that no strong performers would lose money in the first year.

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Key Learnings

• Our company history/data was saying that we weren't effectively paying for performance- we needed to let go of the belief that we were

• The most significant pain points- wasted time and energy of the managers and de-motivation of the employees- helped us sell the changes.

• We involved senior leaders early and often throughout the process so that they have ownership (not an “HR initiative”)

• We ensured that no strong performers would lose money in the first year.

How can

Synergita help?

WINNER of Microsoft Code For

Honor 2014 Large Enterprise Software

Best Human Capital / Talent

Management Solution

Prabakar MarimuthuDirector Technology, Synergita

• Synergita is a Continuous Employee Performance Management, Development & Engagement Software

• Helps in building a world-class company culture driven by employee recognition

What is Synergita?

Goals & Achievements

Continuous Feedback

Recognitions Check-InsAnnual

Reviews

Focus on Holistic Employee Development

Gre

at P

lace

to

Wo

rk c

om

pan

ies

Our global customers

Synergita – quick look at the functionalities

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Agile Performance Management

HR Dashboard

Real time goal setting

Real time feedback

Development discussions

Value Propositions

Disruption

Insta-Go

100% Compliance

HR Elevates to being a strategic partner

Personal Touch

Peace of Mind

Key Differentiators

Disruption

WOW Features

Digital Cockpit

Insta-Go

Easy Administration

Works the way you want it to

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Energizing Employee Performance ManagementActive user involvement is imperative The team must be...

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