“When executed well by an organization, performance management is a clear and consistent signal to employees about what the organization values and rewards its people for. To add the most value, the process needs to focus not just on assessment but also on development.”— Shona Brown, former SVP of Business Operations at Google
As organizations become more and more agile to hit their growth and revenue targets, sometimes they have to rethink their internal processes. One often outdated process is the traditional annual performance review, which can no longer keep up with the demands of the workforce.
It’s clear agile performance management is becoming a widespread movement, as traditional guardians of managing employees against a normal distribution curve, like GE, IBM and Microsoft, do away with annual performance reviews and explore new ways to foster development. Here at BetterWorks, we want to leverage our platform to respond to these digital changes in performance management.
Earlier this year, we announced an exciting new BetterWorks feature that facilitates real time coaching in the workplace: conversations. The module allows employees to become high performers, stay engaged and advance their careers by participating in frequent conversations with their managers.
While creating this new module, we partnered with several of our customers to understand their needs. One major retailer we worked with put it best:
“Having more lightweight performance conversations™ will help managers, employees and teams stay focused on what matters. Discussions about accomplishments, challenges, support, development and an employee’s growth should be happening more frequently through a formalized process.”
With these needs in mind, we built BetterWorks conversations and in the process developed five best practices that companies can use to re-evaluate their performance development™ model:
- Feedback should be more frequent. Nobody likes long wait lines—not even goals. The annual performance review waits way too long to provide feedback, especially when businesses are rapidly growing and changing. If you want to adapt to your changing environment, you should apply the same principle in developing your workforce: for instance, provide feedback on goals on a quarterly or monthly cadence, rather than an annual one.
- Conversations should be lightweight. Our conversations could use a diet. In the diagrams above, you can see that traditional feedback focused on the process, with intense once-a-year goals and reviews rather than lightweight, frequent conversations. Instead, the experience should focus on the individual, with ongoing conversations about expectations, feedback and development.
- Leveraging data inputs drives high performance. Many organizations believe that they are taking a data driven approach through the use of ratings, but the rating itself stems from a subjective opinion. Instead, companies should be using qualitative and quantitative data as inputs to drive high performance in employees. Discussions should focus on reviewing goals set at the beginning of the quarter, progress made and feedback from peers. In this way, conversations become more efficient and meaningful.
- Focus on impact and meaning to increase engagement. Managers tend to focus on either business results or personal development in meetings with employees. However, the best conversations should connect both. Knowing how an individual’s goals connect to the company’s top company goals shows the impact of the employee’s contribution. Similarly, managers can help their teams develop both the skills and the will to achieve. Done well, this gives individuals a sense of self-worth and drive.
“With BetterWorks, people get a chance to understand how the work they’re doing affects the bottom line of the company, and it really enables them to focus the development of their career with that conversation in mind.”—David Rosenthal, Agile Coach, ConsumerAffairs
- Conversations should be balanced. The development conversation tends to be very top down and backward looking — managers evaluate employees by reviewing work from the last quarter. If conversations are being held regularly, managers should try to break the tradition and balance the conversation out. This includes the opportunity for employees to provide managers with upward feedback, as well as have a conversation focused on iterating and setting future goals. Two-way feedback creates more balanced opportunities, which in turn increases operational excellence for the entire company.
Each of these five strategies supports our new BetterWorks conversations feature, where managers and employees can have frequent, ongoing and meaningful conversations to improve employee engagement and high performance at work.