HCM Strategy Discussion: Performance Management

March 24, 2014 Harry West

performance management

Like a lot of kids, I hated report card day. I am a bad test taker, and one of those people that has to chew on an idea for a while before it sinks in. I usually ended up understanding a concept a couple weeks after the semester ended, when it no longer counted. So when I grew up and entered the corporate world, I was glad to leave grades, and all the problems that go with them, behind me.

Except for the “yearly review” of course (or the “Performance Management process” as it’s known to to Human Capital Management (HCM) experts), which is perhaps an even more painful process. Work in the modern corporation can be a complicated haze, with many job descriptions devolving into simply “Does Stuff.” And yet, a manager is expected to take time out of her work to give a formal evaluation of how her employee did over the course of the year, usually rating them on a scale of one (“You’re fired”) to five (“You should have my job.”). Most managers and employees seem to dance through this kabuki theater with a balancing act of suggestions for improvement, praise for work well done, and a solid grade of three or four. The process is largely forgotten then, until that yearly email from HR arrives in the inbox.

Seeing this dismal picture, should the Performance Management process just go away? This and other questions are explored by Appirio’s Wes Wu, Harry West, and Patrick Dodge in their first Three Amigos of HCM Strategy video blog. This video is the first in a series of casual conversations between some of Appirio’s best strategy consultants, focused on the HCM issues companies of all sizes face today.

One idea they give is that companies should not think of Performance Management as  a cyclical process. Wes suggested companies should “Get rid of HR shepherding the process, get employees and managers to do it on their own.”

The Three Amigos discuss this awkward role most HR departments play in the corporate Performance Management process.  “HR can never influence how well an organization manages performance, they can just provide guidance, tools and instruction,” Patrick added. It seems that HR departments frequently own the process simply because they own the system that records the results the Performance Management cycle.

One alternative to Performance Management they discuss is the idea of Social Coaching, which new technologies make easier than ever. A frequent criticism of Performance Management is that it is backwards looking, while social coaching is forward looking. Patrick added that “Organizations are flatter, more virtual, and more global, and the performance review technology just can’t keep up.” Moving away from a “form-based” process to a more organic one better fits how we live and work today.

If you have an interest in Human Capital Management strategy or Performance Management, watch this video and join the discussion. Future episodes will cover topics like Gamification, Big Data, and many other strategic topics facing today’s workforce.

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