In recent months there has been an increasing torrent of comments about enterprises lacking the skills needed to be agile and staff engagement falling. For example:
“We are concerned when we see that many executives around the world don’t have confidence in their organisation’s skills to achieve strategic goals and that most of them are not planning to address it. Doing business today is fundamentally different from just a year ago, and you have to have the right talent within the organisation to meet your goals.” “Creating leaders must happen on an international scale to connect disparate workforces as well as at a deeper level within the organisation to engage more people.” “Virtual leadership development has the unrivalled benefits to meet these demands. It accelerates a business strategy that is essential to not only adapt to today’s market conditions, but also to take advantage of them and stay ahead. Those who don’t get on board will be left behind.” Ray Carvey, Executive vice-president of corporate learning and international at Harvard Business Publishing.
The 2012 Towers Watson Global Workforce Study highlighted that “Companies are running 21st Century businesses with 20th – century work-place practices and programs” and that “Retaining employees has more to do with the quality of the work experience overall.
Our hypothesis is that a more holistic “Performance review and Expectation Setting Meeting” – at least annually would provide an improved foundation for skills building, engagement and moreover embedding a culture of performance. In developing the following proposition we have kept in mind two propositions:
- An overall objective of promoting enterprise performance and in particular improved financial outcomes over time i.e. not purely short term profit maximisation
- Developing people is a strategic activity that merits top management time, commitment and very visible sponsorship
Reflecting upon our own experience of individual performance appraisals in a broad spectrum of organisations of the last 35 years we have formed a view that in general appraisals have been too tactical, based upon too little input and insufficiently forward looking. Moreover, the emphasis has been on skills and little attention focused on motivation or considering opportunities for broader contribution.
Having recently been impressed with the Academy of Management Journal article “How Does Human Resource Management Influence Organizational Outcomes? A Meta Analytic Investigation of Mediating Mechanisms” written by Kaifeng Jiang, David P. Lepak, Jia Hu and Judith C. Baer, and their conclusion that skill-enhancing practices, whilst positively related to human capital are less positively related to motivation and opportunity enhancement, we are building on their research that used the following framework:
To make appraisals more strategic we see a need to inject into the start of the annual process an assessment of the overall enterprise’s “As Is” and desired “To Be” in relation to their organisational ambition. For example a Tom Peters Company Excellence Audit TM. Before the line manager starts writing the traditional appraisal we believe the following 6 inputs would improve the overall value of the overall process:
- 360 appraisal feedback,
- Competency requirements identified for the individual’s current role and the next 2 roles he / she could be eligible for,
- The individual’s assessment of current performance,
- A statement from the individual stating what opportunities they see for developing their career in the direction(s) that interest them most,
- Any data available from the Enterprise’s Talent systems (for example their pace of development compared with their peers),
- The Line Manager’s expectations for the individual over the next 30, 90,120, 360 days.
We believe that this broad input will facilitate a richer dialogue, a greater focus on future performance and provide a much more robust basis for sharing expectations and agreeing objectives.
Objective setting: – a key to unlocking “discretionary” performance
In our ever more competitive world we need Leaders that empower individuals to do more to deliver maximum value to clients (internal as well as external) -and indeed more value than their equivalents in competitor organisations. Much of this will involve “discretionary behaviour” and doing things outside the routine in their own area of the business. As objectives are considered, including, ones designed to increase the individual’s motivation and the opportunities for them to contribute, in addition to skills building. In our increasing networked world these could usefully include specific targets outside their own business area. Lunch presents a great opportunity for starting this!
In conclusion, we believe that entering performance appraisal discussions with a broad picture of the areas the enterprise will need to develop if it is to achieve its enterprise ambition will create a better platform for discussing opportunities and for identifying objectives that individuals will find motivating. Moreover this will contribute to a skills building agenda that will better equip the individual for future moves up or across the enterprise and help succession planning. Efficienarta is “on standby” to help you to pragmatically implement measures such as these and institutionalise them in a process to improve the organisational agility of your organisation and the engagement of your people.