Five concerns of practitioners who design and support SPM:
1. Eliciting
the active involvement and buy-in of executives and managers to the design,
roll-out, and ongoing use of the program elements
2. linking
the components of the program to the strategy of the organization overall while
maintaining relevancy to departments and individuals throughout the
organization
3. keeping
the program current so that managers and employees will find it valuable and
will be motivated to use it
4. capturing
the learning so that managers and employees become more able to focus on
performance issues and creating an environment in which it is acceptable to
discuss difficult performance issues
5. evaluating
the program, assessing its impact on individual, departmental, and
organizational performance and regularly fine-tuning the program to improve its
effectiveness.
Human resource and/or
organizational development professionals are likely to be responsible for the
design and implementation of the SPM program. However, these professionals need
the active engagement of the employees and manager who will use the program.
The elements of the program need to be helpful in doing their jobs. Customizing
performance dimensions and incentive plans to the organization, and having the
people who will use the program involved in the customization, is likely to
result in a program that will be accepted and valued.
The performance management
process should be viewed as developmental and evolutionary. Working on its
design educating managers and employees during its initial roll-out, and
supporting the use of the program over time helps educate managers about the
meaning of performance management. They can then grow more comfortable dealing
what performance issues and incorporate performance discussions into their
daily activities. Over time, performance management becomes part of the way the
organization does business. A performance-based culture is created.
Overall, when creating strategic
performance management programs, HR professionals can generate higher degrees
of commitment to both the program and the process of performance management by
inviting managers and employees to contribute to the design, implementation,
and evaluation of the program. HR professionals should strongly consider
forming a design task force for development and implementation with
representatives from different functions and levels of the organization. This
will not only help build commitment, it will also help to ensure that key
components (e.g., performance dimensions) that are important to the overall
organization, as well as those that are unique to specific departments or functions,
will be included in the program. After the program has been implemented, HR
professionals should consider forming a performance management council to
oversee the program’s assessment and use. As a result, monitoring the use of
the program becomes more than the bureaucratic exercise of being sure forms are
completed; rather, it becomes an examination of how people are using the
process, what they think about it, and ways they would like it changed to be
even more valuable.
Sustaining interest in the
process and ensuring compliance are two different things. Compliance can be enforced by requiring that annual appraisal forms be
completed before salary increases or other administrative changes, such as
promotions, can be implemented. However, completing appraisals because they
are required can result in a pro formal exercise with little meaning or effect.
Sometimes organizations try to refresh
their programs by changing formats, rating methods, and performance dimensions.
Training can be used to explain these changes and create more awareness of
performance issues and how the process might be used to evaluate and improve
performance. However, both employees and managers may become jaded quickly
when new performance programs are introduced every year or two.
Another potential reason for
redesigning a performance management program is to build on the skills and
competences both employees and managers have developed in performance
management. For example, as managers become adept at giving feedback and
supporting development, they may need to rely less on formal processes, such as
360-degree surveys. Instead of a semi-annual 360-degree survey for all
managers, for instance, the organization may implement a just-in-time, online
process that allows managers to formulate their own surveys when they believe
they need feedback to understand how their peers, subordinates, or customers
are responding to their decisions and actions. In other words, they learn when
to ask ‘how am I doing,’ and how to gather information that will help them
guide their efforts.
Knowing when to adapt or devise
an entirely new performance management program requires constant assessment. Assessment is usually the job of the human
resource or organization development professionals in the organization. They
need to devise and implement methods for assessment, and they need to convince
top executives of the importance of investing in assessment.
There are four types of
assessment data:
1. attitude
surveys that ask about the perceived value of the performance management
program
2. behavioral
data, which may be self-report (part of a survey that asks not only about value
but use; for instance, ‘Did you complete the annual performance appraisal form
for all your subordinates?,’ ‘How often do you and your manager discuss your
job performance?’), or it may be frequency counts of use (e.g., number of
managers who completed appraisal forms for their employees)
3. behavior
change reflected in changes in performance ratings over time or external
measures (e.g., number of times a behavior was carried out, such as a
successful sales call)
4. improvement
in bottom-line performance and outcomes associated with the organization’s
strategic goals (e.g. change in profits, sales, new clients, employees hired,
employees retained, etc.) and objectives (methods for accomplishing the goals).
Each of these measurements has potential
problems. Ratings may be subject to response biases, such as central tendency
(ratings in the middle of the scale) or halo (ratings at the top end of the
scale). In either case, the result is that managers are not truly
differentiating between dimensions of performance but instead rating one
employee or all employees the same on all performance dimensions. So when the
data are averaged across employees to consider performance change in a
department or the organization as a whole, the results would be confounded by
rater error. Behavioral and performance ratings may be a function of many
factors other than an honest assessment of performance as defined by the
performance management program in place. This is why multiple measures are
needed to understand the performance management program from different
perspectives and to recognize the diverse factors that influence performance,
including faulty measurement. Insights result as data from different sources
and indicators converge to tell a consistent story. So, for instance, attitude
survey results may indicate that performance dimensions are difficult to
understand or too time consuming to complete. This may explain why managers
leave items blank, fill out the appraisal forms in a cursory way, or don’t meet
with employees to discuss performance results.
Program evaluation, alternatively
called action or applied research, faces greater challenges than basic research
because program evaluation is not designed to eliminate alternative
explanations. So the data are likely to be subject to a variety of unavoidable
confounds. However, consistent measurement procedures repeated over time that
take into account subgroup differences are likely to produce meaningful
results. These results can be used to understand how people are using and
reacting to the elements of a performance management program, and can also be
used to fine-tune the program. When the program undergoes a major transition in
response to changes in the organization’s strategic goals, or to increase
awareness of performance issues, or to reinvigorate motivation to apply
performance management techniques, the assessment methods can be changed
accordingly. Some measures may stay the same in order to assess change over
time. Others may be added to reflect performance relative to the new goals and
program objectives. In the case we present at the end of the chapter, the
organization development group used the results of the company-wide employee
opinion survey to track use and satisfaction with its performance management
process, ad to design specific training to meet skill gaps in setting strategic
goals, giving and receiving feedback, and conducting the performance appraisal
conversation.
