If your company is not on the bandwagon, don't feel like you've been left behind. The rumors of performance management's death are premature. According to a global pulse survey conducted just months ago by Willis Towers Watson, only 11% of their participants are considering scrapping the program and only 26% are considering eliminating performance ratings. As we all know from experience, "considering" is not a reliable predictor of future change.
So much for the bracing chill of numbers. We're going to look at some descriptive research today. Instead of debunking the potential for improvement in performance management, I want to share a case study of impressive innovation underway at Juniper Networks. At the most recent meeting of the Bay Area Compensation Association, Charlie Franklin, Juniper Network's Director of Total Rewards, and Jeff Jacobs, their Director of Leadership & Organization Effectiveness, provided a close look at a performance management program that eliminated traditional ratings as far back as 2009 and continues to adapt to the Company's collaborative culture.
What makes their mindset so different? A commitment to create and sustain an approach that achieves business outcomes. In case I'm hearing anyone out there saying, "so what's new?" let me assure you that the approach that Juniper Networks is using has minimal overlap with our more familiar practice of designing performance management to achieve effective administration (of ratings, merit increases, performance plans, etc.).
Because, of course, the iceberg lurking in any performance management flow is, "why?" "Why do I have to do performance plans when I already know what my job is?" "Why does HR claim that we'll update my objectives during the year, when we'll have no time to do it?" "Why does HR spend so much time telling us that the complicated new HCM system puts employees at the center when I still don't hear anything from my manager about my performance until we talk about my increase at the end of the year?" "Why don't I know what jobs I'm qualified to do in this company?"
"Connect everything and empower everyone" -- a minor feat that Juniper Networks has set up for themselves as the major competitor to Cisco. They believe that Mission applies to employees as much as it does to customers, so their first and most obvious change was to eliminate forced rankings since, by definition, they only empowered the few.
Instead of building their new approach using MBOs to answer the question, "what have you done for me lately?" Juniper Networks built it to empower everyone to use their talents and then evaluate how well they went about it. Instead of annual results and future development, managers talk with employees about their capabilities, connections, contributions and careers.
Even in the tough years of the Recession, layoffs and frequent executive changes, they hung in with their emphasis on outcomes over activities, career over year-to-year focus, HR as consultative advisor rather than HR as enforcer. And they've achieved enviable measures of success with their approach -- 80% to 90% employee favorable responses to the traditional survey questions, "I know what's expected of me" and "I know how I'm doing." How many of you, dear readers, get those survey results?
I hope to add more details to the Juniper Networks case study in the near future, but for the time being let me assure you that they still share some of your own challenges: Increasing frequency of feedback between manager and employee, improving effectiveness of one-on-one employee/manager discussions, building the support of executives newly arrived from other companies and so on. But instead of thinking (and staffing) as if the performance management program should only need updates when it's clear that something is broken, they treat it as the business process it is and work to improve its effectiveness and impact every year.
Planning to make a name for yourself in 2016? Base your strategy on the popular ebook, Everything You Do (in Compensation) Is Communication @ www.everythingiscommunication.com. Margaret O'Hanlon, CCP collaborated with Ann Bares and Dan Walter to create this DIY guide to compensation leadership. Margaret is founder and Principal of re:Think Consulting. She brings deep expertise in compensation, communications and leadership to topics like the CEO Pay Ratio and performance management discussions at the Café. Before founding re:Think Consulting, Margaret was a Principal at Towers Watson.