Performance management. A process that can offer such genuine benefits to an organization and yet such a difficult thing for us to do well.
To begin with, let's look at the phrase performance management. Does this differ -- and if so, how -- from similar terms bantied about including performance appraisal and performance review? In my view, and that of most other professionals practicing in this area, there is a difference. A performance management process may include performance appraisal or performance review as one of its components, but it is bigger, broader and, ultimately, different in its focus. The purpose of performance management is not to “rate” people. The purpose of performance management is to create an environment where successful performance is a high probability outcome.
In distinguishing between performance management and performance appraisal, we can find a helpful analogy in the quality movement. Traditional performance appraisal is really “quality control” by its nature, with the supervisor or manager playing the role of the passive “end of line” inspector. Performance management moves us into the arena of TQM or “quality assurance”, where the system supports the leader in playing a dynamic, proactive role as performance coach.
At its essence, performance management is simply the practice of good management. It involves setting and communicating performance expectations to employees. It involves providing the feedback, coaching and support necessary to help employees reach those expectations. And -- yes -- it involves reviewing and recognizing performance results. So why aren't all results-focused, forward-thinking organizations practicing good performance management? The answer is simple: effective performance management is tough to do. The truth of this statement was born out in a 2004 study on performance management conducted by WorldatWork (www.worldatwork.com). Close to 60% of the 414 organizations participating in the study gave their own performance management systems a “C” or worse grade in terms of effectiveness. The reason most frequently cited by study participants (30% of them) for this poor grade is that their organizations still view performance management as an HR process primarily used to make reward decisions, as opposed to a business critical process for driving improved performance results. Other barriers to effective performance management mentioned by study participants include "process too burdensome and time consuming" (26%), "lack of buy-in by managers and employees" (25%) and "lack of ownership at the top of the organization" (21%).
|
% of Orgs |
Organization views performance management as an HR process rather than a process for driving improved business results |
30% |
Lack of a performance-driven culture |
28% |
Process too burdensome & time-consuming |
26% |
Lack of buy-in by managers & employees |
25% |
Lack of ownership at top of the organization |
21% |
So, how do we go about the admittedly tough business of making performance management work? Tomorrow's post will highlight a few best principles.
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