Priming for performance (draft) v0 - There Be Giants
Transcript of Priming for performance (draft) v0 - There Be Giants
`
Priming for Performance How you can draw from the revolution in Performance Management to transform your results
Roger Longden Partner, There Be Giants
PRIMING FOR PERFORMANCE ︱Page 2 [email protected] therebegiants.com
Introduction page 3
Who this paper is for and what it will give them page 5
How There Be Giants can help page 6
The current state of Performance Management page 7
The case for change page 10
The three organisational elements that demand conscious management page 12
The risks to alignment page 14
The nine elements of a great performance management system page 19
Integrated shared values page 21
Growth mindset page 22
Coaching page 23
Line-of-sight between business priorities and individual objectives page 24
Real-time feedback page 25
Focus on feedback and future capability page 27
Remove rankings, ratings and grades page 29
Simplicity page 32
Challenge under performance page 33
Summary & Conclusions page 34
About the author page 37
Appendix 1 - feedback frameworks page 38
References page 40
Contents
It’s no secret that great performance management is a challenge most businesses struggle with. This is regardless of their size, sector, experience, geography or the resources they have at their disposal.
Most performance management (PM) defaults to an annual
appraisal approach in which achievement against a number of
objectives is assessed, a rating awarded and (possibly) there’s
some discussion of career planning and training/development
needs.
I believe that PM presents a huge opportunity for business to
improve their profitability and outcomes, for stakeholders,
employees and customers. As such, I conducted research over
a twelve month period spanning 2014/15 where input was
collected from over 200 business owners and senior leaders.
All had a vested interest in the management of individual
performance across their workforce. Our key findings were:
PRIMING FOR PERFORMANCE ︱Page 3 [email protected] therebegiants.com
Introduction
Research now not only proves this approach to be
ineffective, but shows that it actually undermines the very
performance it seeks to encourage.
I believe change is not only possible, but also imperative. If
60% of senior managers don’t believe their organisation’s
approach to managing individual performance is helping them
achieve their business objectives, then that alone is a
compelling case for change. However, the case grows stronger
when we take account of research from respected
organisations like the NeuroLeadership Institute on how poor
PM carries both a human and organisational cost.
Why does this continue?
We are starting to see the grass roots of new thinking and
practice emerge. Technology businesses (like Google and
Juniper) were some of the earliest to adopt new approaches -
some as far back as ten years ago. More recently, major
professional services firms like Accenture & Deloitte have
followed suit. However, the majority of businesses and
organisations still don’t know what choices they have to break
the annual cycle they find themselves in, or how they could
start creating a new PM system.
The good news is that in my research, 92% of senior managers
reported having an appetite for change and a desire to move
towards a more productive and sustainable approach to PM.
PRIMING FOR PERFORMANCE ︱Page 4 [email protected] therebegiants.com
Organisations who still use the traditional annual appraisal
approach to PM are not only failing to access the untapped
potential in their workforce, they are actually holding
collective performance back and generating unnecessary cost
This paper has been written for those who believe there is more that can be done to transform the management of individual performance in both organisations and businesses.
It provides a view on why traditional Performance Management
is fundamentally flawed and is limited in its ability to generate
great results. It also outlines some pioneering examples of
how performance management is being developed.
It also outlines the nine elements needed to for a performance
management system to deliver long-term success and how PM
can be a lever to help consciously create a high-performing
organisation. .
PRIMING FOR PERFORMANCE ︱Page 5 [email protected] therebegiants.com
Who this is paper for and what it will give them
This paper examines:
• Why traditional annual appraisal based Performance Management is flawed as an approach to enabling people to deliver great results
• Examples of how some organisations are taking a fresh approach to Performance Management and doing things differently
• A model to illustrate where and how your business or organisation could start to transform your approach to Performance Management
Releasing potential. That’s our purpose.
From the individual work we do with business leaders, owners
and managers, to the overall organisational perspective we
take within our research and practice, we spot the hidden
potential and help release it.
Businesses can't avoid changing size and shape - especially the
high-growth businesses we often work with. It’s the nature of
our economy, as market forces constantly ply their
opportunities and threats, businesses are pushed and pulled in
many directions.
Businesses who make the choice consciously create the right
structures, systems and skills - and underpin them with a great
culture and a clear vision/strategy and plan - deliver clear
benefit to their bottom line - FACT.
We see Performance Management as being central to creating
a great organisation that delivers consistently fantastic value.
This is why we chose to take two years to research and create
this paper.
If you’re curious about how well Performance Management is working in your business, then we’d love to take you
through our best-practice assessment, which is based on the nine-point model we propose in this paper. Just drop
us a line and we’ll set it up with you.
Consciously creating the organisation you need to be
successful sounds simple right? It’s amazing how often it’s
overlooked and what a difference it can make
We like to call it Organisational Architecture - intentionally
building an environment in which the business (and it’s people)
can thrive and grow.
PRIMING FOR PERFORMANCE ︱Page 6 [email protected] therebegiants.com
How There Be Giants can help
The way the majority of businesses and organisations (in both commercial and public/non-profit sectors) manage the performance of their people both sabotages and limits the very results they aim for;
For too long people have been at best de-motivated and at worst damaged (along with potential talent wasted) in the pursuit of a command and control default management style that’s often the intention, and almost always the consequence of the traditional annual appraisal-based approach to Performance Management (PM)
This current state of affairs will be explored within this paper
however, the questions I believe it raises are:
Why do stakeholders, be they investors seeking high returns or
public servants trying to balance service quality with ever-
diminishing budgets, allow such a wasteful practice to roll on?
Surely they owe it to their shareholders, stakeholders or tax
payers to get the best returns?
Perhaps the most compelling argument for change is that
employers who hold fast to traditional PM will find attracting
and retaining great people increasingly difficult - therefore
driving up their costs and making them less competitive. Much
has been written about how Generation Y (often called
“Millennials”) highly value investment in the their personal
PRIMING FOR PERFORMANCE ︱Page 7 [email protected] therebegiants.com
The current state of Performance Management
Organisations who still use the traditional annual appraisal
approach to PM are not only failing to access the untapped
potential in their workforce, they are actually holding
collective performance back and generating unnecessary cost
development and will judge both their potential and existing
employers on their commitment and ability to support this.
PM has long been an area of interest for me. I’ve been on the
receiving end of some shocking appraisals and also
experienced the demands of a HR-driven process and system
which redefined the term “inefficient” and attributed more
value to meeting deadlines (regardless of outcome) than to the
impact of the process upon the people it was there to help
manage and develop.
While this may make me sound like I’m against any form of
Performance Management, let me be clear, I’m not. If great
organisational performance is to be achieved, then there’s no
escaping that the people within it need their individual
contributions managing too. I just refuse to believe the status
quo has to remain. There has to be a better way!
PM is not a new challenge. Back in the 18th & 19th century, it
was common practice in England's industrial north
for mill owners to place coloured wooden blocks
above the looms of their people. That was their way
of giving feedback on a worker’s performance,
publicly placing in the spotlight their star workers and
ridiculing their low achievers.
In the work my Partnership (There Be Giants) does
with business leaders, managers and their teams, I’ve become
aware not just of where there’s scope for much improvement,
but also of where some innovative and exciting approaches are
being taken to address the PM challenge. This motivated me
to undertake some research of my own to dig deeper into what
was going on - both good and bad. The main findings from
this research were outlined within the Introduction on page 2.
PRIMING FOR PERFORMANCE ︱Page 8 [email protected] therebegiants.com
There have also been some larger studies on PM published
recently which echo these findings, albeit from a larger
research base. Here are some examples.
The Institute of Leadership & Management found in the
research for their report “Beyond the Bonus: Driving Employee
Performance” that managers believe only 33% of their people
respond positively to appraisals. When their people were
asked the same question, only 20% said they agreed with that
[1]. This highlights not only the general engagement challenge
that PM faces, but also points to a gap between the
perceptions of those who deliver PM and those who receive it.
The Korn Ferry Leadership Institute discovered that when
rating over 7,500 leaders and managers on 67 difference
leadership competencies, the ten competencies associated
with “growing talent” (i.e. developing your people, which is a
major element of PM and one of the most effective motivators)
were also the bottom ten [2]. That means, on average,
managers are worse at developing their people than anything
else they do!
Those large cornerstones of the corporate world - PWC and
Deloitte - have also recently published their own research into
PM. Deloitte found that 58% of senior managers felt PM was
not an effective use of time and only 8% reported they felt PM
drives high levels of value for their business [3]. PWC reported
that 66% of large corporations are looking to make changes to
their PM and 5% are looking to change it completely [4].
PRIMING FOR PERFORMANCE ︱Page 9 [email protected] therebegiants.com
“…managers believe 33% of their people respond positively to appraisals; …only 20% of their people agreed…”
“…only 8% of senior managers felt PM drives high levels of value for their business…”
While it is encouraging to see there’s an acknowledgement of the need for change, one of the important questions this paper looks at is why hasn’t that change happened yet. To some extent, the green-shoots of the early adopters are starting to break ground and it’s these pioneering few who could shine a light on the way forward for those who want to improve their PM, but are unsure where to start.
While Google and other tech giants were the very
first to adopt transformative PM 10-15 years ago,
another recent and very high profile sign-up to the
revolution is Accenture. They announced their plan
to drop annual performance appraisals for all 330,000
employees globally in July 2015 [5]. They are
framing it as moving from Performance Management
to Performance Achievement and their Chief Human
Resources Officer - Ellya Shook said:
This is indeed refreshing to hear and the thinking behind
Accenture’s approach will be examined later. Essentially, what
Business Leaders finally seem to be grasping is the clear
correlation between an energised, innovative and engaged
workforce and every key business metric they value, from
productivity to earnings per share. This stands true in all
sectors - commercial/public/non-profit - and in all sizes of
organisation both big and small.
PRIMING FOR PERFORMANCE ︱Page 10 [email protected] therebegiants.com
“When we hire great people, we should trust them and give them freedom to innovate rather than managing, measuring and administering a process”
The case for change
The inescapable reality is that from 1 employee to 100,000
employees, if people don’t feel valued, trusted and engaged,
you will not get anything more than the bare minimum
required. Mediocrity will prevail and the bottom line will be hit
by higher than necessary sickness, recruitment & exiting costs
and be weakened by low productivity.
The Barrett Values Centre did some analysis in 2012 where they
compared the earnings per share of the Standard & Poor’s 500
over a ten year period with the same measure for the US Best
Companies to Work For index (similar to the UK Times
Top 100 best employers). Those businesses on the US
Best Companies index out-performed their S&P 500
peers by over 10% and also showed greater resilience
in recovering their lost value after the 2008 downturn
[6]. Because a company listed on the index needs to
excel in managing, leading and developing their
workforce, it can be suggested there’s a direct link
between their ability to do this and their financial resilience and
higher results.
The mounting evidence of the impact to the bottom line might
well be the incentive business leaders need to convince them
it’s worth reviewing their approach to PM. After all, people
costs are one of (and often the) largest cost to a business, so
shouldn’t their stakeholders expect them to achieve the best
(and most sustainable) return? It wouldn’t make business sense
to invest in a new production line and run it at 100% until it
broke down due to lack of preventative maintenance. So why
do this with people?
Let’s look next at what you need for great PM.
PRIMING FOR PERFORMANCE ︱Page 11 [email protected] therebegiants.com
“…Essentially, what business finally seems to be grasping is the clear correlation between an energised, innovative and engaged workforce and every key business
metric they value…”
“…Because a company listed on the index needs to excel in managing, leading and developing their workforce, it can be suggested there’s a direct link between their ability to do this and their financial resilience and higher results…”
People are a little more complex than machines and, as a leader or a manager trying to manage performance, there are plenty of opportunities to score an own-goal.
I believe there are three elements that require consideration
when exploring why PM can be so tricky and where the
solution will lie:
1. Collective Mindset - Initially, there’s the Collective Mindset
of the organisation with all its culture, habits, norms and
unspoken rules. Culture is what can derail even the most
finely-honed strategy and it’s both the culmination of, and a
contributor to the other two elements.
2. Systems are both the formal and the informal ways that
things are done. Some may be rigid and highly engineered
while others, often those associated with people,
have the scope to be more flexible in nature and less
defined. This makes the performance of human
systems heavily dependant on the quality of the
interactions within them. Under traditional appraisal-
based PM, this puts the person leading the PM
conversation (i.e. the manager) at centre stage. The
language they choose has a huge impact on the
outcome of that conversation and the success of the
system.
3. Personal Mindset - The criticality of the manager-
employee interaction means the language the manager
chooses has a major bearing on the personal dialogue (i.e.
how they feel about their job, what’s being asked of them
and how fairly they feel they’re being treated) of the
employee which has a major influence on their degree of
motivation. This drives the quality of their Personal
Mindset.
PRIMING FOR PERFORMANCE ︱Page 12 [email protected] therebegiants.com
The three organisational elements that demand conscious management to achieve great Performance Management
When we consider the interplay and complexities at work here,
it’s easy to see why PM is believed to be misfiring in so many
organisations. There needs to be a direct line-of-sight right
through all three of these factors. If any are out of alignment,
then your PM will not deliver to its full potential.
PRIMING FOR PERFORMANCE ︱Page 13 [email protected] therebegiants.com
Curious about how your business shapes up?
Why not try our best-practice assessment?
Drop us a line for more information
Before we can take a look at where the answers may lie, it makes sense to examine what might cause misalignment. Regardless of how simple and efficient the system may be, or the level of focus that’s given to managing culture, the key factor which underpins performance is personal mindset. If this internal dialogue is not below par then will forever remain mediocre at best
A significant contributor to the debate around PM in recent
years has been David Rock. Rock (as head of the
NeuroLeadership Institute) has helped decode the complex
findings of neuroscience research and apply them to the key
people-related challenges businesses and organisations face
today, such as PM. On the subject of PM, Rock believes [7]:
This is a worrying claim however, neuroscience is now helping
us to develop new approaches to PM. Advances in brain
imaging technology over recent years have provided a clearer
insight into how our brains respond to various
situations. Rock suggests the fairly simple principle
that we instinctively move towards reward and away
from threat. However, the complexity lies in what we
perceive as threat and reward. He has identified five
general domains (see SCARF insert) where he
believes both threat and reward can be experienced.
PRIMING FOR PERFORMANCE ︱Page 14 [email protected] therebegiants.com
The risks to alignment
“In the context of neuroscience research, most PM practices turn out to damage the performance they are intended to improve. That’s because they are based on a fundamental misunderstanding of human responses.”
As a leader or a manager, you will get better results if you are
consciously managing these responses in your people. This is
because when we feel threatened, our ability to problem solve,
think laterally, creatively and collaborate with others is severely
limited. We basically hold all our resources back for our own
use and protection. These qualities and behaviours are
essential when facing the challenges of modern day business
and public service.
Given that our threat response is the more sensitive of the two
(it’s there to keep us safe after all) there are plenty of
opportunities for traditional appraisal-based PM to set off the
hair triggers within us. I’m going to use SCARF as the lens
through which to examine how traditional PM systems &
processes can have such a severe impact on the employee
internal dialogue due to the “flash points” which can be
triggered off.
Let’s start with the PM system itself. Often it’s owned by
Human Resources departments, runs on an annual cycle, can
be complex to use and places the emphasis on feeding
information into decisions like pay and promotion. There is
likely to be a template that the reviewing manager needs to
complete along with a number of boxes to be ticked and
ratings to be awarded. The emphasis is often on getting the
information into the system, rather than the quality of the
conversation with, or the outcome for, the employee. The
consequences of this might be:
The process becomes more important than the person.
If the employee is left with this perception, their status
domain may experience a threat response as they are likely
to be left feeling undervalued and disengaged;
PRIMING FOR PERFORMANCE ︱Page 15 [email protected] therebegiants.com
SCARF domains:
Status - how we perceive our position in relation to others
Certainty - how secure we perceive our future to be
Autonomy - the degree to which we perceive we have freedom of choice
Relatedness - the degree of connection we feel to those around us
Fairness - how fair we perceive an exchange to be
The driving force behind PM becomes about command & control.
If this is the perception then the autonomy domain takes a
hit as they are left feeling “done to” with little or no
opportunity to influence the outcome;
The review can often be a long time after the event - possibly up to twelve months.
This could trigger the fairness domain as a sense of injustice
may come from having all errors and challenges stored up
for an “ambush” in their appraisal. It might also trigger
relatedness as the lack of timely feedback only serves to
highlight a poor connection between the manager and their
employee. Also - especially if performance is only discussed
at an annual appraisal - so much can be felt to be riding on
that one conversation (i.e. a pay rise, a promotion etc.) that
certainty takes a hit as the employee is likely to be highly
anxious about what the outcome will be - not an ideal state
for reflecting on feedback and thinking creatively;
There’s a prevalence for managers to give an average ranking to the majority.
This is has been found to be quite common within traditional
appraisal-based PM systems [7]. The belief on this is
that a low grade is likely to reflect poorly on the
awarding manager (i.e. one of their people is a poor
performer whom they have been unable to turn
around). Also, high and low ratings often attract
additional focus either to justify the proposal or
remedy the issues. This can mean that low
performers get bumped up and high performers get
penalised. This runs the risk of causing a significant
hit on fairness for those being appraised.
PRIMING FOR PERFORMANCE ︱Page 16 [email protected] therebegiants.com
What we are concerned with here is perception management.
If people don’t trust the process (of which their manager is a
key part) to be objective and fair, they are likely to be “shutting
down” even before they arrive at the appraisal meeting
(remember 79% believed PM wasn’t viewed positively in their
organisation). Indeed, research has even shown that we only
have to witness other people experience a painful interaction
(e.g. possibly hearing about a colleague who has had a bad
appraisal conversation) to trigger our own threat response [8].
So, if a manager delivers an appraisal that’s not considered to
be fair by one of their team members, it’s likely the rest of them
will be “shutting down” before their own appraisals
even start.
This leads on to the dynamic between the appraising
manager and the employee. Right from the outset,
traditional PM puts the manager in a position of
judgement and power. Berne [9] recognised these as
being qualities we often exhibit when we’re in a
“parental” state and, no surprise, they often elicit a
“child” state in the recipient, in this case the
employee. This is not to say they scream and shout,
but is more about their inclination to only hear what
confirms their beliefs and to become defensive. The
solution is to move to a more “adult-to-adult”
interaction in which both parties value and trust each
other.
At a cultural level, the biggest symptom and cause of PM
dysfunction is the belief that people can’t or won’t develop and
grow. This “fixed mindset” was historically supported by the
scientific community who initially thought that our intellect was
fixed at birth - in other words “we only have what we were
born with.” Research has now shown this not to be true. The
brain is very much capable of learning new habits right through
PRIMING FOR PERFORMANCE ︱Page 17 [email protected] therebegiants.com
“If people don’t trust the process … to be objective and fair, they are likely to be “shutting down” even before they arrive at the appraisal meeting”
to our very later years. This principle of “plasticity” has major
implications for business and the way people should be
managed, what can be expected of them and indeed how they
should be motivated. This challenges the belief that people, in
general, are limited in their abilities. They are likely to be far
more capable than previously thought if managed well.
While there have always been managers who have instinctively
believed in their people’s potential and ability to grow, there
are many more who don’t and may indeed intentionally seek to
limit it, again for reasons of command & control. This is
regardless of no end of esteemed management and leadership
authors advocating people empowerment and development as
a sound facet of a successful business strategy. Now,
neuroscience gives us the evidence to show why it works and
strengthens the argument for it to be no longer ignored.
PRIMING FOR PERFORMANCE ︱Page 18 [email protected] therebegiants.com
“The brain is very much capable of learning new habits right through to our very later years”
Curious about how your business shapes up?
Why not try our best-practice assessment?
Drop us a line for more information
Across the landscape of PM, amongst the current appraisal and rating conversations, we find that little of it seems to be effective. There are however, some managers who do seem able to make PM work for them and their people, despite the inertia they have to work against. This is often because the manager instinctively has a “growth mindset” (i.e. holding the belief that everyone has the potential to learn and grow) allied to a strong coaching style and is prepared to dilute/challenge the command & control traditional PM enforces.
The key to improving PM therefore lies in not only encouraging
more of a shared “growth mindset” and coaching management
style across the business, but also in creating the right PM
system that supports and promotes the best conversations and
behaviours.
PRIMING FOR PERFORMANCE ︱Page 19 [email protected] therebegiants.com
The nine elements of a great Performance Management system
Curious about how your business shapes up? Why not try our best-practice assessment? Drop us a line for more information
I believe an effective PM system is comprised of the following
nine elements:
i. A clear set of shared values (and supporting behaviours)
across all roles & teams
ii. A central belief that is rooted in the principle of “growth
mindset”
iii. Extensive use of coaching (i.e. enabling others to find the
solution rather than spoon-feeding it to them)
iv. Direct line-of-sight between business/organisational
priorities and individual everyday activity
v. A system that facilitates real-time feedback, possibly
through the use of social technology
vi. A focus on feeding-back and assessing/developing
capability for future performance
vii. Does away with numerical ratings and any forced-ranking
activities and links reward to value added by the individual
viii. The system itself is not over-engineered and aligns the the
principles of simplicity, agility and transparency
ix. Makes provision for managing genuine under-performance
These will each be explored in more detail to see why they are
vital.
PRIMING FOR PERFORMANCE ︱Page 20 [email protected] therebegiants.com
i. Clear shared values & behaviours which are fully integrated into key business processes
Most organisations and businesses have gone through the
exercise of developing a set of values. This is often driven
by Marketing with the belief that it will strengthen the brand
in the eyes of the customer. The risk is that once this hard
work is done, they become a plaque on the wall in reception
and only get mentioned at new-joiner inductions.
A huge amount of value can be driven by integrating the
values (and supporting behaviours) into key business
processes such as recruitment, reward, promotion and the
management of individual performance.
These should also be supported by clear individual and
team role statements which detail responsibilities, how they
fit within the organisation and what their measures of
success are.
Defining a set of values, and then not working by them can
be seen as inauthentic, is likely to drive up cynicism and
weaken trust. This will impact internal dialogue and
personal mindset.
An organisation who is regarded as being true to their
values stands a good chance in positively impacting the
SCARF domains of certainty, relatedness and fairness.
PRIMING FOR PERFORMANCE ︱Page 21 [email protected] therebegiants.com
“A huge amount of value can be driven by integrating the values (and supporting behaviours) into key business processes”
ii. Shift to a growth mindset
This requires a “whole systems” approach starting with the
beliefs of the leader who can then reinforce a growth
mindset throughout the business by using training,
intelligent design of the performance system (e.g. guidance
on structuring great conversations) and integration into the
values and expected behaviours. If you explicitly state that
you expect your staff to develop and will both champion
and even celebrate that development, then you’re
publicly reinforcing your belief in it. Remember, it’s
the perception you have to manage, so having the
policy and even the practice is not enough if it’s only
going on quietly.
By adopting the feedback tools suggested, while
making provision for and honouring a commitment to
staff development, you will be visibly demonstrating
your belief in a growth mindset.
PRIMING FOR PERFORMANCE ︱Page 22 [email protected] therebegiants.com
iii. Make extensive use of coaching
The managers who are working within traditional PM, but
yet are still achieving good results are likely to have a
naturally strong ability to coach their people. A coaching
culture is evidence of the organisation or business believing
in a growth mindset. It builds capability through on-going
learning and reflection. It also encourages independence
by supporting employees to find answers for themselves.
This can have huge benefits for productivity, creativity and
diminishes the need for management to focus on low-value
activity. When allied to a culture where mistakes are valued
as opportunities to learn, this type of environment can have
a very positive-reward impact on autonomy (e.g. “I’m given
the freedom to discover and learn) and status (e.g. “I’m
valued and trusted to learn from my mistakes”).
Get curious if you’re told that your managers are already
coaching their people. ILM found that 88% of managers
believed they were, yet only 46% of employees agreed [1].
PRIMING FOR PERFORMANCE ︱Page 23 [email protected] therebegiants.com
“…get curious if you’re told that your managers are already coaching their people. ILM found that 88% of managers believed they were, yet only 46% of employees agreed”
iv. Direct connection between business priorities and individual performance
If the business has developed a clear vision, strategy and
plan, and it is thoroughly understood by all, then people
should be asked to set their own goals based on those of
their direct manager. For SCARF, this is good for Status
(“I’m trusted to set my own goals”) and Autonomy (“I’m
allowed to set my own goals”).
The outcome should be clear individual goals that are all
aligned to business priorities.
Google’s OKRS approach (see insert) gives an example of
alignment in action.
PRIMING FOR PERFORMANCE ︱Page 24 [email protected] therebegiants.com
How Google set goals
OKR’s (objectives & key results) goal setting steps:
Set up an objective which is ambitious and feels a bit uncomfortable
Draw up some key results which make the objective achievable and are quantifiable
OKR’s are:
Set at an individual level - an over-arching annual OKR supported by quarterly OKR’s that support it
Set at team and organisation levels
Limited to between 4-6 per quarter for individuals
Fully transparent - anyone can look at anyone else's (including Larry Page’s) at they are published on their personal home page
“The outcome should be clear individual goals that are all aligned to business priorities.”
v. Real time feedback
Ditch the annual appraisal meeting!
I can’t stress this strongly enough.
Get into the habit of having regular performance
conversations (at a minimum, quarterly). Leaving too long
between an event and the feedback increases the risk of
triggering a fairness threat (not to mention the wasted time
due to the possible delay in correction). Regular, respectful
feedback is the cornerstone of a great management
relationship and can reinforce reward under relatedness if
done well. Don’t be fooled into assuming that the majority
of managers are already doing this well either.
ILM found that while 69% of managers believed they were
giving real-time feedback, only 23% of employees agreed
[1].
There’s also another dimension to be considered here
too. Alistair Woods - Director of Reward at PWC has
seen an increasing trend for immediate feedback as
Generation Y join the workplace. The Twitter
generation want it short, snappy and now. Get it
right and you’ll strengthen your engagement with this
ever expanding generation within the workforce.
Technology has a role to play here. There are now a
number of apps that facilitate real-time feedback. If
intelligently adopted; they could strengthen the connection
between co-workers regardless of location.
PRIMING FOR PERFORMANCE ︱Page 25 [email protected] therebegiants.com
“ILM found that while 69% of manages believed they were giving real-time feedback, only 23% of employees agreed”
One other factor to be considered in a move towards
healthier and more productive feedback is that training
support should be given to those who will receive feedback
(i.e. everyone) so they take it productively. Focus should be
on “reflecting” rather than “reacting.” This is where some
degree of basic Emotional Intelligence (EQ) training in self-
awareness and self-management would be valuable.
PRIMING FOR PERFORMANCE ︱Page 26 [email protected] therebegiants.com
Focus should be on “reflecting” rather than “reacting.”
Curious about how your business shapes up?
Why not try our best-practice assessment?
Drop us a line for more information
vi. Focus on feedback and developing capability for future performance
Feedback is nothing new. It’s long been prescribed
by management experts and Human Resources
professionals as something most employees will
appreciate and benefit from. And if delivered
skilfully, they are correct to say so. The problem is
that the majority of feedback is delivered with the
skill and dexterity of a sledge hammer and so causes
the opposite reaction to that which was hoped for.
This is where even the most well-intentioned of
managers can fall foul of the threat and reward response
discussed earlier.
Research has found that even the anticipation of receiving
feedback can trigger our threat response and limit vital
resources like objectivity and reflection - key when working
out what to do with some feedback we’ve just received.
However, just a subtle shift in emphasis from “this is how
you are” to “this is how you’ve done” can cause the
feedback to be received far more positively and
constructively. The first statement labels the individual -
which reinforces the “fixed mindset” - whereas the second
labels the behaviour which can be changed and developed -
which reinforces the “growth mindset.”
PRIMING FOR PERFORMANCE ︱Page 27 [email protected] therebegiants.com
“Research has found that even the anticipation of receiving feedback can trigger our threat response”
Hand-in-hand with looking back at what the individual has
achieved should be a discussion around their on-going fit
for the role and their future capabilities. This goes beyond
what training needs they may have, and should explore how
aligned they continue to be with the values and vision of the
business or organisation. It’s likely that managers will
benefit from some structure, support and training in having
this conversation as it will require a degree of insight and
potential challenge. However, it can reveal highly valuable
information about how engaged and connected the
individual feels. Juniper discovered that 65% of those who
were found to have low alignment to the organisational
values self-selected themselves to exit the business based
on their forward looking on-going fit conversation.
PRIMING FOR PERFORMANCE ︱Page 28 [email protected] therebegiants.com
Take a look at Appendix 1 for a great, easy-to-use framework when giving both positive and negative feedback which is grounded in psychology and neuroscience and comes from Graham Winter - Psychologist to the Australian Olympic Team
vii. Lose numerical ratings & forced rankings and link reward to the value they create
Rock found that labelling most people with a number
invariably causes a negative hit to fairness, and leaves them
disengaged from any attempt to further the performance
conversation [7]. It can easily come from the knowledge
that others have scored higher or that they feel their
contributions and achievements haven’t been recognised.
I believe the approach Juniper takes (see insert on page 30)
is worthy of merit. A judgement is made on whether the
employee is a “J-player” or not. This involves them being
assessed against the values and behaviours Juniper looks for
in all of its people. This brings focus to how work is done -
often overlooked in traditional PM and also a major
potential source of competitive advantage. They have
designed their process to help them “assess by identifying
value, not a performance score.” The output of this feeds
into a calibration process where managers individually
create a relative ladder of their people which they have to
validate with their fellow managers in their peer group.
The absence of a rating forces managers to become clearer
in their judgements and increases the quality of the
feedback to individuals. The peer group of managers also
score each other on how well they practiced Juniper’s values
throughout the laddering process. This ensures it doesn’t
turn into a hidden ratings exercise.
Juniper then provides pay guidance to managers based on
positions achieved within the ladder. However, managers
have full discretion to determine compensation within their
budgets.
PRIMING FOR PERFORMANCE ︱Page 29 [email protected] therebegiants.com
“…assess by identifying value, not a performance score”
It’s interesting to see how Juniper have linked their
definition of performance to pay. Other factors that should
feed into the setting of the pay budget are: how essential
the employees skills are to the business; the cost of
replacing them if they left; their value to customers; and
what the conditions are in their sector of the job market.
By making compensation decisions reliant on the outcomes
of an annual appraisal conversation, you are allowing a high
level of anxiety to build (because a threat to the certainty
domain is being triggered) - far more than is necessary. This
creates precisely the wrong type of internal dialogue for the
employee and shuts down vital attributes that modern
businesses claim to value like creativity and balanced
thinking.
Forced rankings (where managers are instructed to assign a
fixed proportion of their people into various percentile
ranges often with the lowest being sacked) drive a massive
threat hit into certainty and fairness. The often ruthless
nature of this approach leaves employees fearing they may
directly lose their job because of their rating. This practice
generates a dog-eat-dog culture and couldn’t do more to
destroy good team work and collaboration if it tried!
Forced rankings became popular in the 1980’s under
the auspices of the likes of Jack Welch at GE with his
Vitality model. As a practice, they represent the most
damaging element of traditional PM practice and
should be disbanded by any organisation seeking
high levels of sustained performance. It’s
encouraging to see those previous staunch advocates
of forced ranking (like Ford and Microsoft) are leading
the way with its removal and replacement. [11]
PRIMING FOR PERFORMANCE ︱Page 30 [email protected] therebegiants.com
“…making compensation decisions reliant on the outcomes of an annual appraisal …creates precisely the wrong type of internal dialogue for the employee and shuts down vital attributes that modern businesses claim to value like creativity and balanced thinking”
PRIMING FOR PERFORMANCE ︱Page 31 [email protected] therebegiants.com
How Juniper do PM
They hire and encourage employees in four ways:
Career plans - look for “J players” (those who demonstrate the values & behaviours of Juniper)
Connections - how do they connect with the work?
Capabilities - what can they add/build?
Constraints - what’s stopping them?
Their performance system is made up of four principles:
Goal alignment - ensuring a direct line-of-sight between individual and business goals
Relative laddering - peer-manager calibration of an employees contribution to Juniper, rather than validating a performance score
Compensation - broad pay guidance provided to managers for each employee based on the relative laddering process along with full discretion to determine compensation within budgets
Conversation day - a twice yearly event which focusses on future career & potential contributions first before looking at current connections and contributions
Curious about how your business shapes up?
Why not try our best-practice assessment?
Drop us a line for more information
viii. Don’t over engineer the system
Ensure that any performance system or process you develop
is simple, agile and transparent. These three principles
make sound business sense on both a practical and an
emotional level. Simplicity is essential because you want to
encourage buy-in and that will be easier if people can grasp
the new approach you decide to take with PM.
Agility is vital because only those organisations/businesses
keeping up with and responding to change will be high
performing. The world can look very different in just twelve
months which makes the traditional PM cycle obsolete.
Transparency is valuable as it helps to build trust. If a
frontline employee can see what the senior manager’s goals,
measures, results and rewards are, then fairness is likely to
be positively rewarded.
As previously mentioned, poor systems design can drive the
wrong management behaviours and severely limit employee
performance. I believe there is no reason why intelligent
systems design can’t drive the right behaviours.
PRIMING FOR PERFORMANCE ︱Page 32 [email protected] therebegiants.com
“Ensure that any performance system or process you develop is simple, agile and transparent”
ix. Don’t ignore under performance
There’s no escaping the reality that not everyone is going to
step up to the mark. Even your best recruits can have a shift
in priorities. In this event, there still needs to be a
structured approach to giving them the opportunity to
receive support to help them back on track. However, this
should be time-limited and bound by clear and measurable
development objectives so that if this doesn’t work, then
dismissal can be effected quickly. If a person is wrong for
the business or organisation, then it’s in the best interests of
all parties that the relationship is brought to an end at the
earliest opportunity.
If this process is regarded as being transparent and fair then
it can still have a positive impact on culture, as those seeing
others go through it are likely to recognise it for its fairness.
A reluctance to address underperformance is likely to have
the opposite effect. The risk is that those who believe they
are performing may develop a sense of unfairness as they
see themselves as carrying others, or receiving the same
rewards as those who are under performing. The
consequence is that an overriding perception of
unfairness develops, internal dialogue takes a hit and
morale and motivation are damaged.
PRIMING FOR PERFORMANCE ︱Page 33 [email protected] therebegiants.com
The days of command and control as a default approach to management are over - particularly in the skilled sectors of the economy. Employers who fail to appreciate this and get to grips with not just the way their managers manage, but also the organisational culture and the systems that underpin performance, will never be high performance.
A key motivator for businesses has been the battle for great
talent - attracting and then keeping great people. Five years
ago, a business with 10-15 employees wouldn’t have
felt the need to give any real time to thinking about
how they keep their best people - that used to be
just a challenge for bigger companies. Some sectors
that we work with - like web-design and digital
businesses - find that if they don’t do this, their
businesses will literally collapse from lack of resource.
It’s that simple!
I believe managers need to be consciously creating
an environment in which people can perform at their
best. They can do this by focussing on the nine
elements suggested in this paper which will help
them create a great mindset within their people and
across the wider business which is supported by an
intelligent system that encourages the right behaviours.
The great news is that we are now in a time where
management has more help, insight and support than ever
before. Coming from both those experienced in
implementing new approaches (and are willing to share) and
allied to the research that’s emerged from neuroscience, the
case for a revolution in PM comes down to one simple fact: it
makes sound business sense.
PRIMING FOR PERFORMANCE ︱Page 34 [email protected] therebegiants.com
Summary & conclusions
I believe we are at a pivotal moment in the way management
best practice is evolving in organisations and businesses. The
scientists and researchers have been advocating change for
over a decade now. Inevitably, it takes employers time to
understand, digest and assimilate new ideas. That we are now
seeing major change in both large corporations and smaller
agile enterprises indicates the evolution is picking up pace.
While there is huge progress to be made, I believe that in
10-20 years we will have seen a pivotal change in the way
individual performance is generally managed. Commercial
pressures alone will not allow businesses to continue with poor
quality PM, and neither will their people, as workforces
become more fluid and mobile.
PRIMING FOR PERFORMANCE ︱Page 35 [email protected] therebegiants.com
“I believe we are at a pivotal moment in the way management best practice is evolving in organisations and businesses.”
The bottom line is, if you want great people, you’re going to have to work hard to attract them and even harder to
keep them. PM can be a major tool to help you do that, so seize the opportunity before your competitors do!
PRIMING FOR PERFORMANCE ︱Page 36 [email protected] therebegiants.com
Almost everyone has experienced Performance Management, so almost everyone has an opinion
about it and a story to tell. After all, it’s one of the most emotive aspects of modern working life.
That’s why we love talking to business owners, leaders and HR professionals about Performance
Management. Nothing makes us happier to help a business improve its results and create a more enjoyable and engaging culture for its people.
If you’d like to explore how you could approach this, or to try out our best-practice assessment, please get
in touch.
Roger Longden is a practising leadership and management
coach who works with clients ranging from agile & innovative
tech businesses up to large commercial and public sector
organisations. Prior to that, he enjoyed an extensive career in
IT where he held a number of strategic, operational and sales
roles. He is no stranger to challenge, having worked in some
of the most demanding work environments imaginable ranging
from prisons and remand centres to the offshore oil industry.
He is a visiting lecturer in Performance Management at the
Business School at Manchester Metropolitan University, a
Partner in There be Giants and recently co-lead the UK’s first
NeuroBusiness Conference.
He is also a rowing coach and enjoys translating the principles
of great performance management into sport.
He can be contacted via:
07791147556
PRIMING FOR PERFORMANCE ︱Page 37 [email protected] therebegiants.com
About the author
Graham Winter - Psychologist to the Australian Olympic Team -
recommends a very simple model to set up the best
environment for feedback to have good impact. It both sets
the expectation that feedback will be given and then smooths
the way for it to be delivered effectively [10]. He suggests the
relationship is initially primed by using GET:
Goals that are shared
Expectations about behaviour
Trust to be open and honest
Discussion about shared goals helps to encourage alignment
and is an opportunity to check they are well formed.
Discussing expectations should help to avoid any assumptions
about what’s required and how it should be done. Trust isn’t
something that can be instantly generated. However, if both
parties work on being approachable, open, dependable and
act with integrity, then that’s an excellent basis on which to
build it.
For the feedback conversation itself, Winter suggests REAL for
corrective feedback and RITE for positive reinforcement
feedback.
These are simple yet effective tools which are routed in both
psychology and neuroscience. Both can have a big impact on
the quality of a performance conversation.
PRIMING FOR PERFORMANCE ︱Page 38 [email protected] therebegiants.com
Appendix 1
PRIMING FOR PERFORMANCE ︱Page 39 [email protected] therebegiants.com
REAL - Corrective feedback
What Really happened? - be objective and remove judgement
What was the Effect? - ask them if they know what the impact was and if not, outline it without exaggerating
Ask them if they can see how their actions contributed to the impact and how they will do it differently next time?
Lift them by leaving them with an encouragement and reinforcing your confidence in them and their abilities
RITE - Positive reinforcing feedback
What did they do that was Really positive?
What was the Impact of their positive action
Thank them for doing this
Encourage them by asking what they need to repeat it
[1] - “Beyond the Bonus” The Institute of Leadership and
Management
[2] - “The World is Flat … and So Are Leadership Competencies” by
Kenneth De Meuse, King Yii Tank, Kevin Mlodzik, and Guangrong
Dai. A Korn Ferry International Research Foundations paper. This
survey research was conducted in 2008 and 2009.
[3] - “Performance management is broken” by Lisa Barry, Stacia Garr
& Nany Liakopoulos, Deloitte University Press 2014
[4] - ‘Transforming performance management’ research which
interviewed 97 large organisations and 1,038 employees in
organisations of over 1,000 employees or £100m annual turnover.
The research was carried out in June 2015.
[5] - “Accenture CEO explains why he’s overhauling performance
reviews” - Lillian Cunningham, The Washington Post, 23rd July 2015
[6] - “Unleashing Human Potential for Performance & Profit” Richard
Barrett, Barrett Values Centre
[7] - “Kill Your Performance Ratings” David Rock, Josh Davis and
Beth Jones, Strategy & Business Journal, 08/08/2014
8] - SCARF - David Rock, NeuroLeadership Journal, Issue 1 2008
[9] - “The Games People Play” - Eric Berne,
[10] - The Man Who Cured the Performance Review - Graham Winter,
Jossey Bass, 2009
[11] - Vitality Curve - Wikipedia - https://en.wikipedia.org/wiki/
Vitality_curve
{12} “CEB Juniper Case Profile” The Corporate Executive Board
Company, 2012
PRIMING FOR PERFORMANCE ︱Page 40 [email protected] therebegiants.com
References
PRIMING FOR PERFORMANCE ︱Page 41 [email protected] therebegiants.com
PRIMING FOR PERFORMANCE ︱Page 42 [email protected] therebegiants.com
www.therebegiants.com [email protected]
@ThereBeGiants
Manchester, UK