What could be more powerful and engaging than knowing that the work you do is an important part of what helps your company succeed ... and having your manager reinforce that fact regularly by highlighting the connection between the goals you are striving to accomplish and the organization's most critical priorities?
What is the biggest difference between a performance management system whose return-on-effort is primarily compliance and one that actually drives improvement in corporate performance.
Yes, it's the A word. Alignment.
How are we doing in that regard?
A recently released Hewitt study The Current State of Performance Management & Career Development 2010, which features responses from 193 employers, gives us a peek at the answer.
On the question of alignment, the linkage of employee performance expectations to business strategy, the chart above shows that only 15% of the surveyed organizations reported that employee goals are "very aligned" with organizational priorities.
The large majority (73%) indicate that goals are somewhat aligned, that corporate goals are communicated and then left to local managers to translate. So, for most employers, it all rests on effective coaching and direction from the local manager. (All responses are detailed in the chart below.)
And how's that working for us? The Hewitt study also provides a revealing answer here. When asked to name the top performance management process improvements needed by their organization, guess what came out as #1 and #2?
#1: Performance coaching - 65% ranked as one of their top three improvement needs
#2: Managers not held accountable (for performance management) - 35% ranked as one of their top three improvement needs
(Oh, and the #3 process improvement need? Linking performance management to business strategy. Surprise!)
The Hewitt report further notes that the dial is not moving much on the "managers able to coach" thing; in a similar study five years ago, 73% of respondents identified it as the area needing the most improvement.
All this, I'm afraid, only serves as fuel for the anti-performance management fire. No wonder Samuel Culbert and others are calling for us to kill the performance review. Do you hear CEOs or CFOs yelling back at them, leaping to defend the process? Not me. And no wonder. There's little evidence to support the notion that performance management is driving real business value.
Until we fix that, it'll only be HR and reward folks (and possibly a minority of us at that) fighting to save performance management.