Transcript Performance Management
Performance Management: Keys to Making It Work!
Presented by: Alan Todd, Chairman Raj Ramachandran, Performance Management Research Lead
The Presenters
Alan Todd
- Chairman of Corporate University Xchange Over the past 20 years, he has won many learning industry awards and has spoken at conferences around the world on workforce development strategies. While serving as a thought leader in the learning industry, Mr. Todd founded and served as CEO for two successful global learning companies. Prior to joining CUX, Mr. Todd was the Chairman and CEO of KnowledgePlanet, a company he founded in 1996 that helped launch the eLearning revolution. Mr. Todd led the company through mergers and acquisitions, expanded the user-base to 150 countries, and raised nearly $100 million in private equity. Prior to KnowledgePlanet, Mr. Todd was the Chairman and CEO of KnowledgeSoft, a training company he founded in 1986 that was acquired by Staffmark - a $1.2 billion Information Technology company - in 1996.
Raj Ramachandran
- Performance Management Research Advisor for Corporate University Xchange Raj has over 10 years experience in learning and performance management, studying strategies and best practices in Global 2000 organizations including American Airlines, International Paper, Raytheon, Washington Mutual, and others. Prior to CUX, Raj was the learning and performance management practice lead for TPI, a global sourcing advisory firm. He has also served as a business process consultant for Accenture, IBM and PricewaterhouseCoopers.
Agenda
Performance Management Lifecycle
Key Insight Areas in the Performance Management Lifecycle
The Corporate University Xchange Performance Management Maturity Model
Headlines – Executives Speak out on Performance Management
The Performance Management Study
Released in May 2007 150 Organizations surveyed Average of 24,000 employees Conducted 15 qualitative interviews Large, global participants including:
Why Performance Management?
Performance Management IS on the CEO’s Agenda
An opportunity for CLO’s and Talent Management leaders to add critical value A powerful, strategic tool for transformation
Key Insight Areas – Performance Management Lifecycle
Goal Setting – Keys to Success
Cascading goals remain visible Improves alignment to strategy S.M.A.R.T. goals Balanced scorecard Hoshin planning Does your organization's performance management process incorporate the notion of cascading goals through levels of the organization?
11% 17% 72%
Yes No Not Applicable
Competency Management – The “How” of Performance
Established by organization’s desired culture Drives career development Competency models are either purchased from an external provider or developed internally
Key part of the performance rating process Does Your Performance Management Process Include Rating Competencies? 4%
Yes
27%
No
69%
Not Applicable
Culture – Leaders Set the Example
Alignment of organizational objectives
Identifying and recognizing top performers
Compensate high performance Disincentive low performance
Identifying and removing poor performers
Creating talent pools & succession planning processes
Employee Surveys – Vital to the Performance System
Also known as employee satisfaction, climate or engagement surveys
Tracks improvement in employee perception
Decide where to focus additional training
Correlate manager effectiveness & employee loyalty
Employee self-assessments are widely used
Most important arbitar of fairness
Coaching – The Responsibility is On the Manager
Objective is to grow and develop employees
Requires regular, honest and open dialog between employees and their managers
The quality of the conversation is the key to success
Some companies are conducting spot checks – providing immediate feedback
Poll Question
What type of rating scale does your organization currently use to evaluate employees?
Likert scale (1 through 7 scale) or greater number Likert scale (1 through 5 scale) Likert scale (1 through 3 scale) In the process of changing the rating scale Other
Ratings – Multiple Strategies are Vital
Absolute scales vary – all over the map
Matrix of performance vs. competencies
Forced ranking processes have divided support
High use of 360 degree feedback functionality
A strategic requirement:
Informs compensation Rewards Succession planning Improvement plan
Technology – Nothing More Than an Enabler
No dominant vendor
Highly customized (and therefore ‘homegrown’)
Buyers tend to focus on the automation of the employee assessment and appraisal process first
Technology – Tools for Performance?
Which, if any, of the following systems does your organization use to automate its performance management processes?
We do not use a system to automate performance management processes Home-built system Other SAP Success Factors Softscape SumTotal Systems, Inc.
Kenexa Oracle Saba Software SAS
3% 3% 1% 1% 1% 1% 6% 6% 12% 23%
N = 120
45%
Poll Question
What are the barriers to successfully implement a performance management program in your organization?
Clear vision and communication from CEO and Senior leadership No or limited consequence for non-performance (tolerated in the organization) Managers and leaders are rewarded for developing their people Lack of consistent review and coaching processes Other
Barriers To Success
What are the Barriers to Success of A Performance Management Program
The organization's strategic plan has been well communicated at every level Clear vision and communication from the CEO and senior leaders Excellent performance is rewarded and there are consequences for non performance Managers and leaders are rewarded for developing their people A clear line of sight from each individual to business goals Defining workforce competency gaps and target effective learning and development to close gaps Managers' commitment to L&D initiatives Selecting and monitoring appropriate measures of performance against targeted goals Not Applicable Lack of definition of goals and objectives - and how they support company strategy Lack of a solid review and and coaching program
3% 7% 8% 9% 10% 9% 11% 10% 10% 10% 12%
N = 630
Stage 0
No Performance Management process in place
Subjective opinions drive annual reviews
No visibility of strategic plan
Paper performance reviews stored in HR files
Stage 1
PM process implemented but inconsistent
Goal statements written but disconnected
Little or no quantitative measures in place
Infrequent training on coaching
No quality assessments of goal statements
Stage 2
Standard, enterprise-wide process
Some steps automated with technology
Visibility of metrics available at higher levels
Managers can prioritize to 5 or 6 key goals
Coaching dialog tracked but not assessed
Stage 3
PM process steps mastered and automated
Clear visibility and alignment of objectives
Technology integrated with learning
Focus on improving quality of coaching
PM drives other talent processes
Stage 4
Real time adjustments to individual performance
Cultural shift towards improved performance
Managers are empowered as “barrier busters”
Ability to measure ROI of performance processes
PM process feeds the “execution quotient”
Headlines – Executives Speak out on Performance Management
“Performance = results + behaviors”
“I use Performance Measurement and Management as a core management tool for myself and my direct reports, and I firmly believe we must all see PM not just as a year end review process but as a way to manage our individual performance and direct it in the most effective and efficient ways.”
“Performance Management is a CEO-driven initiative and we have 98% participation throughout the organization.”
“
We have been doing this for 5 years and every year we are getting better at it (and we are light years ahead of the industry).
”
Thank You Questions/Comments?
Please join us for our next webinar Leadership Development at Pfizer: What Happens After Class Wednesday, September 12, 2007 at 11 AM ET