Rethinking Performance Measurement In Disruptive Times

Rethinking Performance Measurement In Disruptive Times

How do you measure performance in changing times when commercialisation is simply unpredictable? As work shifts so does performance measurement and evaluation. The traditional end of the year approach designed in the 1970s cannot work in today's work world. While the tools are not all here, it is clear that new rules of measuring performance are here and working. A study by Charles E. Lance et al in ‘Personnel Psychology’ indicated that 45% of respondents think the traditional means of evaluating performance did not motivate employees and 41% of managers show bias about the traditional end of the year approach. Imagine an organisation with 37,000 employees, imagine being able to understand the skills, strength and passion of every individual in such an organisation! Try to understand the immense benefit – the outcomes – of that transparency. There is someone in that crowd who can handle any project or any job, if you utilize their talents in an agile way. Imagine what difference just one employee can make if you understood him and equip him with what he needs to put his best to work. This was what Cisco thought. They considered that being a 30-year-old technology company, their employee demographics evolved, but their processes haven’t. The solution came in the form of the Talent Cloud, an agile talent ecosystem that enables employees and leaders to match skills and strengths to work by leveraging data and reputation. Talent Cloud delivers on two key promises in Cisco People Strategy – “One size fits one” and “one company, many careers.” Both allow their employees to have an experience at Cisco that is differentiated and personalised. The core of the Talent Cloud is generated by the insights and reputation of their employees. It is a kind of internal CRM, where employees import a personal profile, highlight strengths and assess their skills against roles. Managers can also assess their employee’s skills and identify development opportunities for the employee to explore. When a role or project becomes available, leaders and managers can search the network to see if someone within Cisco’s employee population is a match. The system will automatically notify those matches. Cisco, GE, and Google have all pioneered this model. These companies have built or bought sophisticated software to understand team dynamics, evaluate group goal systems, and gauge how effectively employees contribute to their teams. The goal of PM is thereby transformed from boosting an individual employee’s performance to improving the results of the team. If the team wins, the employee wins. If the team wins, the company wins. When organisations focus on team performance, they evaluate success by different metrics. Trust, inclusion, diversity, and clarity of roles are critical to team success. Team leaders must be hands-on and actively engaged. And teams must be connected to other teams to succeed. Measuring these new metrics requires new tools and approaches, thoughtful experimentation, and a willingness to adopt new models. Developing greater clarity about how performance is measured is now seen as a core value at many organisations, particularly around check-ins with managers and goal-setting for employees. Some smaller companies have greater flexibility to set goals widely at the individual and team levels, while larger companies may focus on departmental goals. Either way, the old system of cascading goals from the CEO all the way down to the individual contributor is not part of the new design. One sign of positive change is a rise in employee’s driven communication rather than one-way feedback. Evaluating managers on the quantity and quality of conversations is becoming a key to both team and manager success. While the use of a forced distribution curve may be fading, many organisations are unwilling to give up the concept entirely. Ratings are still widely used, though often with qualitative measures instead of numbers. However, today’s new practices look at performance curves and ratings based on richer data, using input from many sources, and in the context of a continuous discussion about things that happened all year—rather than delivering a simple “end-of-year report” that often loses sight of all the things that happen over that 12-month time period. Brian Reuben is a business advisor and keynote speaker. www.brian.com.ng

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