I wrote the article below  – Problems with Performance Management - a few years ago, and for the most part, I still believe the content is true. Most employees see performance management as a means for managers to give feedback (usually badly) on where they need to improve, to find reasons not to give a bonus or salary increase, and to talk about goals for the coming year that won’t be reviewed again until 12 months later.

Many managers have similar cynical attitudes about the process – seeing it as a low value activity they need to tick off to satisfy their managerial responsibilities.

Where to from here?

The future of Performance Mangement lies not in tinkering with the annual review, or implementing even more “state-controlled” procedures that specify pulling apart performance in the mistaken belief that talking about “problems” will change our behaviour for the better.  

In a previous post I referenced an article by Dr Culvert from UCLA Anderson School of Management in Los Angeles, who advocates honest conversations about the success of the partnership between manager and employee as the way forward. This idea resonates strongly with me.

I have worked for some very forward thinking organisations, ones who dedicate huge amounts of effort to their performance management processes – ensuring they are procedurally fair, training managers and employees in the process, and linking performance to annual goals. Despite this effort and the good intent behind it, these organisations fair only marginally better (in my opinion) when it comes to how the process is valued and perceived by the workforce.

We need some new thinking – that much is clear. As the old saying goes – the definition of insanity is to keep on doing the same things the same way, but expecting a different outcome.

What goes on in your organisations? How much effort is being thrown at managing performance, but for little benefit?

Performance Management Gone Haywire

When people are asked to provide their impressions of Performance Management processes, the answer is invariably negative or neutral. It’s not often that the process is positively endorsed by those who use it. So where are we going wrong?

As managers, we know we need a management system of some kind for all the components of performance:

• getting people to work on things that will help the business achieve it’s goals
• identifying and overcoming obstacles that might prevent success
• understand and checking our progress regularly
• giving people a forum for talking about what they are doing and how it’s going
• providing the appropriate checks and balances
• recognising and rewarding performance

I believe there are 5 fundamental reasons why Performance Management is not viewed positively.

1. Reviewers don’t have the skills or confidence to give feedback appropriately

Giving feedback constructively is a learned skill. Unfortunately for their team members, many managers haven’t had any training or support in learning this critical skill. So when it comes to review time, feedback is either:

1.     blunt and delivered with no thought for the impact or consequence,

2.     not provided at all because the manager wants to avoid disagreement or conflict, or

3.     is given in such a wishy washy way that the reviewee actually misses the fact they are being given feedback!

This is one of the most critical capabilities a manager can have, with far-reaching positive or negative consequences. Providing ongoing coaching and support should be part of the approach to managing performance.

2. Employees don’t see Performance Management (PM) as a 2 way street

Is PM something that is ‘done’ to employees, or is it jointly owned with equal responsibility between the reviewer and the reviewee?

Imagine a review session where the employee turns up having evaluated their own performance, provided examples of how and when they achieved each objective, had references from other people about their attitude and behaviour, and already had drafted some challenges they wanted to work on in the next 12 months. When ownership for the process lies with the employee, this is the result.

Getting to this stage takes time. The business needs to consistently communicate expectations and help the manager’s adapt to the new positioning. Instead of PM being viewed a bureaucratic process over which they have no control, employees own their own performance and contribute equally to the discussion about performance levels and results achieved.

3. The annual review is the prime focus

If PM consists only of an annual or bi-annual review, the business is really missing the point. Reviews are useful checkpoints, but PM occurs 365 days a year. When review time comes around there should be no surprises. And I mean none. If there is, the manager is not doing their job effectively. Any performance issues, or comments about achievement, need to be given as they arise, not saved up for discussion 3 months later in a review.

On this basis, the review becomes more of a confirmation of what each party already knows. This shouldn’t take long to go through, leaving plenty of time to discuss development needs and new opportunities (see next point).

4. Not enough attention is given to the future

In many cases the entire review is spent dissecting the previous 12 months. Objectives and goals do need to be valuated and measured – don’t get me wrong – but the real value of a review lies in the discussion about the future.

What skills will the employee need to develop to become even more effective in their job? What work-related challenges can they get involved in that will grow them beyond where they are today? How can the business utilize their strengths in other areas? What gaols do they want to set themselves over the next 12 months? How can the manager help them achieve these things?

It’s this focus on future development and opportunities that energizes people, makes them feel valued and keeps them engaged with the business.

In an ideal world, reviewing past performance and discussing future skills and opportunities will take equal time in a review.

5. There is no follow-up

This is the credibility killer. All throughout the performance year, managers will make commitments to take actions and follow-up. If this doesn’t happen, the whole process loses integrity. Once employees experience this firsthand, it’s a long road back.

Commitments must be upheld, and managers and employees equally need to be accountable for their part in this.

Getting employees to think about Performance Management as a positive process that adds value is the goal. This only happens when the managers have the right skills, the business adopts an ongoing approach that consists of much more than annual reviews, when commitments are made and kept, and when employees own the process equally with managers.