Over two incisive articles, we’ll be exploring performance management’s evolving shape – past, present and future.

In part 1 of ‘Is performance Management dead?’ we explore what’s happening to performance management reviews — whether the existing model is actually driving towards or away from delivering improved performance. We also explore how courageous conversations can underpin future performance reviews and take them where they need to be.

Part 2 looks at taking what we’ve discovered and applying it to new models of performance management — ultimately deciding whether it is indeed dead and if there is a case for ‘managing over measuring’. We also explore how courageous conversations can build trust and the benefit of a high-trust organisation on performance and productivity.

PART 1

IS PERFORMANCE MANAGEMENT DEAD?

With the likes of Accenture, Deloitte and Google among many major players beginning to ditch performance management reviews, is there still value in the process?

Uncovering better ways of working often begins by asking surprisingly simple questions. Over three presentations I gave this month about improving performance through courageous conversations and building high trust, I asked one such question to around 150 HR Directors: Have you ever seen a performance management system that actually improves performance?

The answer didn’t bode well for the status quo: Only 4 of them said ‘yes’. Given that the bones of the traditional annual performance rating system have been roaming corridors, meeting rooms and boardrooms since 1954, it would seem that there’s a case for etching out performance management’s headstone and drafting up its eulogy.

But before we don our mourning suit, it’s worth exploring why both employers and employees are unhappy with what it provides, and where it needs to go to have a life in today’s real-time working economy.

PERFORMANCE RATINGS ARE UNDERPERFORMING

It sounds ironic, but ask any one of us how we feel about the process, and we’d be well within our rights to rate the ratings’ system itself. It’s not trying to be over-smart about it; it’s seeing past the ‘why’ – their clear purpose is a very worthy one – to improve performance, and getting to the mechanics of ‘how’ it’s failing to deliver on its positive intention.

In a nutshell, here’s why performance ratings are underperforming in the three key areas of time, culture and results—

TIME

  • Managers spend 210 hours per year on performance reviews
  • Employees each spend 40 hours a year
  • Annually or bi-annually is not enough – A Harvard Business Review survey found 72% of employees said their performance wo