(This post is the third in a continuing series, highlighting the five trends that are shaping the human workplace in 2021 and beyond.)
Eight years ago, I wrote a book called The Crowdsourced Performance Review, making the case about why traditional performance management was broken. Since then, many leaders of Fortune 500 and other companies have abolished the old, bureaucratic model of annual reviews. Today, only 6 percent of CEOs think their organization’s performance appraisal system is useful. What can take its place?
If traditional sit-down performance management was broken in 2013, it was demolished in 2020. How could a review in December 2020, based on a 12-month-old job description, possibly do justice to the challenges employees overcame?
My message to leaders: 2021 is the year to redefine performance management through human connection. Growing your people needs to become an agile process, in the sense of agile values and methods like putting people at the center of business decisions where they can more quickly experiment with processes and more readily collaborate with customers.
Agile performance management has four pillars: Continuous learning, frequent check-ins, building trust, and connection to the work community. Like the other factors we’re exploring in 2021, all of these reflect the new reality that the human workplace is the new work paradigm.
What is performance management for?
In his new book "Think Again", Adam Grant writes, “Leaders commonly say, ‘We only hire A players. We don’t tolerate B players.’ The reality is that B players can become A players if you treat them in a way that makes them feel truly grateful.”
Agile performance management creates A players through a continuous cycle of positive interactions among employees, managers and executives:
- Coaching and collaboration between manager and employee
- Observing and highlighting the right behaviors
- Recognizing the best actions, values, and attitudes immediately and publicly
- Building community and belonging
All of these interactions require trusted two-way human connections; pretty much the opposite of the old command-and-control idea in which a manager writes a yearly, backward-looking assessment of how the employee is doing. Continuous, meaningful conversations among managers, peers and executives provide a new model for the human workplace.
Coaching is collaboration
With this understanding, CEOs are changing their company’s ideal vision of a manager. Today’s agile manager is no longer a commander and detail-checker but a strong coach. Good coaching is a dialogue in which manager and employee discuss specific parts of a job or project and collaborate on decisions about what needs to get done. When employees participate in a two-way conversation, they gain ownership and accountability. They also become invested in a process that helps them decide their own career paths, even as their life goals change. And over time, every employee learns to give as well as receive feedback.
How frequently should this happen? Gallup recommends ongoing conversations, timely recognition, and informal dialogue on a weekly basis. A holistic performance management system unites these in a regular cadence of coaching, goal setting and check-ins.
A Harvard study found that frequent, regular check-ins with managers improved performance, which is no surprise. The study’s truly amazing finding was that the conversation didn’t have to focus on a particular task or skill. Just having any interaction – an informal conversation about family or the weather — lifted performance. That’s the power of interaction.
What manager has time to give continuous feedback to all their employees? The simple answer is, they don’t have to if feedback can come from multiple sources – team members, business partners, and anyone else who interacts with an employee. In other words, crowdsourced performance management. The manager can’t be everywhere; the community can.
Traditional performance reviews spend 80% of time talking about the past, as a manager lists what the employee did in the previous year. Agile performance management flips the formula to focus on the present and the future. It asks what the employee is doing, what results are happening, and what comes next. If this sounds familiar, it’s the kind of strategic discussion that you have when talking to top executives or boards of directors. From now on, all performance management should be just as strategic.
The most valuable feedback
Objectives and key results (OKRs) have been the typical performance metric for fifty years. They are obsolete in a constantly changing environment. Leaders are changing company culture to encourage risk-taking, innovation, new processes, boldness, questioning, integrity, persistence, creativity, accountability, flexibility and more. It’s not a question of lowering standards (you can achieve six sigma quality in an agile environment.) It is a question of rejecting bureaucracy in favor of human values, with all their diversity and surprises.
The most valuable feedback is recognition that someone has just made a positive contribution to the work, whether that’s closing a great sale, streamlining a process, solving a problem or helping a struggling teammate. Any employee can recognize another as long as they are specific, publicly noting what someone did, why it matters and who benefits. Capture thousands of these moments in a database and you write a narrative of activity that is the real record how work gets done.
Just getting through 2020 required employees to change and collaborate at unprecedented speed. The lesson leaders should take away is that all that apparatus surrounding the traditional performance review is neither necessary nor adequate to meet the next challenge. Starting in 2021, let’s make performance management itself perform better.
(This post originally appeared in Forbes)
About the AuthorMore Content by Eric Mosley