In my last post on leadership and what we can learn from Diddy, I explored the perils of the personal agenda in business and how the most valuable leaders are those who align team behaviour with the goals of the business.
This week we're going to take a deeper look at how to identify the best performance managers in your company using data to make informed decisions about talent development.
Limitations with current processes
The typical performance management process has a few limitations that it's useful to keep in mind.
The first limitation is that most performance reviews are conducted by the manager, who has their own political agenda and frame of reference. This means you aren't technically measuring performance, you are measuring the manager's stated opinion of performance. The two may be the same but it's good to be clear about systemic bias that may lead to misleading results.
The second limitation is that if you are calibrating team performance, the manager is forced to rank people within a closed system. The poorest performer in one team may outperform a top performer in another team but it's difficult to achieve an objective calibration of performance across the company with a subjective process.
The third limitation is that if you are rewarding performance on a budget, managers are forced to justify the rewards they want to allocate with a supporting performance rating. That doesn't mean they will lie outright to give their protege a higher raise but the opportunity to game the system is there.
The fourth limitation is that companies tend to take a snapshot view of performance, rather than looking at it over time. If a consistently high performer suddenly stops performing in conjunction with a management change, this may be worth investigating.
The fifth limitation is that current processes are prone to false positives, i.e. rewarding and developing people who are likely to leave the organisation for greener pastures and/or will not be able to succeed at the next level.
I could go on but you get the idea. The point is that current performance management and rewards processes tend to put the manager in the driver's seat without clear insight into who the best performance managers are.
Enhancing the performance assessment
Social feedback provides an opportunity to enrich the performance review with objective data points. For example, if you have a tool that permits peer feedback, you can monitor internal feedback from peers as well as who is most active at promoting the contributions of others. You can also look at how employees are networked and influential within the organisation using tools like Chatter.
Identifying the best managers
The Institute for corporate productivity (ic4p) published a research paper called the People-Profit Chain in which three key metrics are recommended to help companies identify and develop their best leaders.
- Quality of hire measures the contribution and success of external hires by a variety of factors, such as tenure, time to promotion, performance, added skills and cost. As a former boss of mine used to say, A players hire A players, B players hire C players.
- Quality of movement tracks the career trajectory of employees during their time with the company. The best leaders create opportunities for the people on their team.
- Quality of attrition assesses the quality of people leaving the company based on skill, performance and criticality of role. The best leaders tend to retain great people, who want to work for them.
You can't completely separate politics from business but you can strengthen the performance assessment process with neutral data points and put more rigour around how managers are selected, measured and developed.
Laura Schroeder is EMEA product marketing director at Workday, headquartered in Pleasanton, CA. She has nearly fifteen years of experience envisioning, designing, developing, implementing and evangelizing global Human Capital Management (HCM) solutions and holds a certificate in Strategic Human Resources Practices from Cornell University. Her articles and interviews on HCM topics have been published in the US, Europe and Asia. She lives in Munich, Germany and enjoys cooking, reading, writing, kick boxing (well, kicking things) and spending time with friends and family. If you want to read more from Laura, check out her talent management blog Working Girl or follow her on Twitter @WorkGal.