Human Resource Management > Performance Feedback

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Effective Performance Management Systems

We spend a lot of time thinking about the need for effective performance systems but most veteran managers agree that the concept of performance evaluation, particularly pay-for-performance, while interesting to explore, is exceptionally difficult to put into practice. The most common refrain is that it takes up too much time to evaluate and document performance, but at closer range, what appears to be the Achilles’ heel of most programs, are the overarching demands that encompass an “all but the kitchen sink” approach to performance program design. 

Most typical is the conflation of discipline policies with performance evaluation (see link below “The Difference Between Performance and Discipline Systems”). More onerous is the co-mingling of performance and pay without proper distinction between what is reward for performance and what is an adjustment for inequities in the pay program. Poorly structured pay-for-performance programs can translate as “gobbledygook” and result in backlash if employees sense they bought into a program that serves whatever the need is at the time.

Another oft mentioned reason for programs that don’t work is the reluctance of supervisors to differentiate between high and low performers.  While some do it exceptionally well, many more find the prospect of disappointing or angering an employee too daunting.  It is not unusual for supervisors and managers to blame themselves for the employee’s poor performance,  and this only results in lenient ratings that in turn undermine the integrity of the program.

So, what does it take to create an effective performance management system? 

  1. Emphasis on process

     Start at the beginning and build from the ground up. Meet with key management and discuss what you want to accomplish. Will the system address employee and/or team development? Will it be closely aligned to strategic priorities and focus on measurement? Will it focus on individuals or teams? Will it tie into the pay system, and if so, is the pay system currently well understood?

  2. Keep the Design Local 

    The internet and our colleagues are excellent resources for examples of working performance systems, but none will reflect the culture, shared language and philosophy of the organization for which the system is being designed. Therefore, let the system design reflect the thinking of the management group to the extent that this is practicable. A good professional knows how to incorporate management thought and philosophy into a workable system.

  3. Let employees give input on a pilot program

    The old adage that participation creates buy-in is true enough if the participation is meaningful, but more important to keep in mind is that employees will make the system better if they are given the opportunity to find the “bugs” and provide input in the areas that most concern them. Keep in mind that setting clear parameters for the type and level of input is important to keep expectations in check.

  4. Give the new system time to marinate

    Truly successful programs evolve and reflect ongoing dialogue about performance.  They require commitment over time and painstaking patience to address the nuances about what it means to be a high performer, or how a particular performance goal should be measured. If this seems like a lot work, it probably is, and so it is important to recognize this at the outset.  Although simpler designs are possible, they are less likely to address more complex performance issues.

Templates and Forms to help you get started can be found on the Resources page of the N.J. Hess Associates website.

The Difference Between Performance and Discipline Systems

Two primary approaches to addressing performance are one, progressive discipline, and the other, performance management. Both are feedback systems, but one focuses on administration and the other on development. One is geared toward documenting problems that could lead to dismissal; the other is geared toward building organization success.

The goal of the personnel policy program is to administer work policies and rules. Therefore, infractions of policy and rules should be handled through a progressive discipline system such as verbal and written warnings.

On the other hand, the goal of the performance management system is to coach and develop employees. Where employees exhibit problems with motivation, attitude and related areas, the outcomes or actual results of such problems can be documented and addressed through the performance system.

The difference here is that we are not using progressive discipline techniques, which is a "shape up or ship out" approach, but rather coaching techniques where the focus is on emphasis of both strengths and weaknesses, and giving specific feedback to steer the employee in a particular direction. If problems crop up midyear, and no performance review is expected for some time, the coaching can still take place, but may evolve into a progressive discipline problem without ever being addressed during a performance review.  

The point is, when the review does come around, focus on development issues (i.e., "lets talk about this, I want to hear your view, and I want you to hear mine." ) and leave the "this is a warning" routine to the discipline process.

The main focus of the performance review should be on the observable and measurable goals that have been set. It is easy to over emphasize the small annoyances that cloud otherwise good performance. If the performance review is done correctly, it will serve to strengthen communication between supervisor and employee - MOST PERFORMANCE REVIEWS DO THE OPPOSITE.  The only way to capitalize on this opportunity is to focus on what is most important, be honest and use concrete examples, don=t surprise the employee by coming out of left field with something that should have already been addressed.  Even if an employee is going through a progressive discipline process for lateness and absenteeism, use the performance review to focus on strengths!  If the employee has multiple performance problems, then expedite the progressive discipline process and don=t waste time. Let the employee move on to another job where they can be more productive. Even if they seem distressed, if they are not a good match, then the best approach is to give them the feedback they need to understand why they are not a good match and wish them luck at finding a job which can best use their gifts and talents.