You sit nervously opposite your manager, palms sweaty, head reeling. Your manager hasn’t indicated any dissatisfaction with your work but you’re uncertain about where the conversation will go to next…

If your performance appraisal is only held annually, such trepidation is well-founded.

Hallmarks of the traditional performance appraisal include a critical dissection of past events, a discussion of compensation and financial rewards based upon KPI targets, and maybe some professional development – but only if a problem or weakness is identified.

Traditional performance appraisals hold employees accountable for past behaviour at the expense of improving current performance and grooming talent for the future. Such appraisals typically result in ratings of each employee (high performer, strong performer, solid performer or low performer) and “stack ranking” systems – for example, a “high performer” rating can be applied to no more than 15% of a manager’s team.

The performance management framework of many companies has historically been geared towards poor performers, who constitute around 3% of any organisation’s workforce, rather than the 97% of workers performing at or above expectations.

Traditional performance management approaches also fail to tap intrinsic motivation, are time-consuming and rigid – the last of which is a key consideration in a world where agility is critical and short-term performance outcomes matter just as much, if not more, than long-term outcomes.

Fortunately, ever so slowly, things have changed.

A fresh approach

Today’s approach to performance management is markedly different; rather than 1 or 2 formal discussions each year, it’s likely to involve regular conversations about performance and development. Adobe, an early adopter, calls these conversations “check-ins”: frequent interactions between employee and supervisor based on the employee’s real-time performance needs and goals. Managers and employees meet for check-in discussions at least once a quarter – although either the manager or direct report can request a check-in at any point during the year. The discussion isn’t scripted, and no paperwork is filled out, but three areas are covered:

  • Managers set clear expectations
  • Managers and direct reports collaborate on employee feedback
  • Direct reports are responsible for development (with managers sharing this responsibility)

“The check-ins are a 180[-degree turn] in terms of giving people the material they need to improve their performance and change course,” Donna Morris, then Senior Vice President of Human Resources at Adobe Systems, told Forbes.[1] “It completely changes how employees feel about their jobs and opportunities. Feedback is now viewed as a gift.”

Adobe has subsequently abolished annual performance appraisals, ratings, and a forced distribution curve.

Deloitte suggests a “performance management revolution” is taking place, with a redesign of performance management frameworks deemed a high priority by 79% of surveyed executives.[2]

So, what’s required for such a shift? There are some key elements to consider for a “check-in” performance framework to work. The end result should be a more enjoyable experience for both employees and managers.

EmployeesManagers
Goals & expectationsHelp me stay focused and aligned; let me know what’s expectedProvide insight into progress and challenges; allow for interventions to course correct
Coaching & feedbackWhat’s going well and where can I have a greater impact?Offer real-time feedback for positive outcomes
DevelopmentTalk about my career growth and future direction with the company (or even outside the company)Help employees reach their full potential with tailored development plans
RecognitionMy success is celebrated and I feel valuedCelebrate success to inspire and motivate

 

A culture of continuous feedback

The “check-in” performance management process works best when it’s part of an overall culture shift towards ongoing feedback loops. With traditional approaches to performance, if an employee was told during their annual review that they underperformed months ago, the feedback was irrelevant and demotivating. Timely, constructive guidance – and praise – is far more effective. Pulse surveys are an effective way to foster a culture of feedback. Managers gain timely insights into the thoughts, feelings and engagement levels of employees, while employees feel that their opinion counts for something.

Another critical aspect of this modern performance approach is training managers to give feedback and hold meaningful conversations with employees. Instead of vague generalisations (eg “you must improve your time management skills”), feedback should be clear and actionable (eg “you are repeatedly late to meetings”). Any specific problem should be outlined so the employee understands what needs to be done to improve. A way forward with professional development can then be offered.

Refocusing on succession management

Another benefit of concentrating management efforts on the 97% of workers performing at or above expectations is the likelihood of more conversations between managers and employees around career development and career prospects. By providing a culture of continuous feedback, employees benefit from understanding the career options available to them within their current workplace, and what they need to do to move to the next step. Employers benefit from more effective succession management – especially for leadership and other critical roles – thanks to gaining a better understanding of who their high performers are, and what the aspirations and skill sets of all employees might be.

Putting out fires

If this all sounds time-consuming for managers, remember it’s about putting out fires before they start: there should be no surprises in a performance-related conversation because the employee should already be aware of any areas needing improvement.

In addition, today we have the benefit of technology.

Vendors such as ELMO Cloud HR & Payroll offer tools to support more frequent performance discussions, set goals, capture 360-degree feedback, and make it easier to track related learning activities. ELMO Performance Management streamlines processes with automated e-mail and document routing, templates and new workflow functions to make it more convenient to schedule and conduct performance discussions within the flow of daily work. ELMO’s integrated talent suite also means it’s possible to reward and recognise employees for accomplishments and create comprehensive succession management plans without having to leave the platform.

 

[1] https://www.forbes.com/sites/davidburkus/2016/06/01/how-adobe-scrapped-its-performance-review-system-and-why-it-worked/#4ee702b655e8

[2] “Human Capital Trends 2017”, Deloitte

Learn more about how ELMO can help your organisation.
Learn more about how ELMO can help your organisation.