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performance management is broken

Performance management is broken. Here’s how to fix it.

By Nicola Vass - 12th December 2018  |  Government , HR Director , Performance

Performance management and performance development are familiar terms to HR and managers alike.

As an HR professional, you may already have a performance management or development system in place. Most performance models have three main components for employee development:

  1. Creating expectations,
  2. Monitoring progress, and
  3. Corrective action or rewarding good performance.

The idea is that by translating organisational performance goals into employee performance goals, your organisation is more likely to meet its objectives. That is, what your staff are working on is what the organisation needs to achieve. The idea makes sense: make an annual plan, customise that plan for all employees, and stick to it throughout the year.

Most existing models are retrospective. They focus on what has happened in the past and try to correct these behaviours, even when they could have happened months ago.

Why is it broken?

As most of us have experienced, plans and their associated goals frequently change. By the time you have your annual review, these plans and goals may not have been addressed. As a result, you may miss out on a bonus or pay rise because your performance plan doesn’t accurately reflect the work you actually did. When management’s expectations are not communicated clearly or frequently enough, employees are mistaken for poor performers. This may lead to several performance management conversations about how to get back on track, rather than constructive conversations about future goals and achievements.

Most existing performance management approaches don’t work because they are focused on the past and built around the Theory X assumption, that the manager has to extract performance from the employee. HR directors everywhere can all agree that annual reviews are not an adequate measure of performance management. Annual reviews are outdated as they often focus on issues that are no longer relevant and don’t inspire performance development. The current performance management system is broken. Frequent, timely and informal feedback works best.

Especially in the public sector, the term ‘performance management’ has negative connotations as employees perceive it to be about negative feedback and remediation rather than positive feedback and reward. Managers tend to subconsciously control the performance of their employees through using the carrot-and-stick approach. Individuals are unable to drive their own performance under this management style and it lowers engagement and productivity as a result.

Moving to Performance Achievement

Performance management and development needs to change. Current performance models are limited by their focus on the past to change behaviour. It is always better to prevent than cure, and organisational performance is no different. Rewarding or punishing people for something that happened long ago (up to a year ago in the case of annual reviews!) is not conducive to creating a high performing culture. And it certainly doesn’t increase engagement.

Some models are good

As a HR professional, you understand that workplace expectations are shifting, and you’ve likely seen some promising new approaches (see the NSW Public Sector Performance Development Framework as an example).

There is no denying that there are some good models on the market. Some seem eerily familiar, being variations of the original approach. Others are boldly based on evidence-based positive organisational psychology principles. This might be that given the right support and opportunity, employees will apply their natural strengths to deliver the right work, meeting organisational goals.
Unlike performance management, performance achievement entrusts individuals to self-reflect on their own performance and empowers them to initiate change. This allows managers to focus on supporting and coaching their employees rather than performance managing them.

What’s missing? Team Performance

While there are good models on the market, they all have something important missing. They fail to recognise the importance of the ‘team’. A team is not just a group of people with the same manager, but rather individuals working collaboratively to meet the same goal.

Despite their importance, team dynamics are often left out of performance management and development approaches. While there are team-based performance models and frameworks that exist, none of these are integrated into individual performance development plans. And they should be. Teams have a strong impact on employee engagement, learning, motivation and development.

team work and performance

Good project teams and some software development methodologies (for example SCRUM, XP) integrate team dynamics and practices to achieve their performance goals. But until now, HR hasn’t had an organisational performance process leveraging teams.

So given their importance, why aren’t teams included in performance development approaches?

What the science says

We know from 70 years of behavioural and organisational psychology that the people around us (the team) are highly influential on individual performance. People are inherently social and, as a result, performance is a combined effort. Meeting organisational goals requires more than cooperation and commitment. Everyone needs to work well together and help each other achieve the same outcome.

Teams increase performance

The mere presence of other people enhances the employee’s performance, efficiency and accuracy in achieving familiar tasks. In saying that, the employee’s performance in unfamiliar tasks tends to diminish. When working in a team environment, employees are generally hired for specific roles and are grouped together according to how well these roles complement each other to meet the goals of the organisation.

Having colleagues constructively observe each other’s work leads to better results. If the work is unfamiliar, having a supportive team to accelerate learning leads to faster results.

Teams accelerate and embed learning

The influence of teams on learning is not a new concept. You may be familiar with the 70:20:10 model for learning and development, in which social learning accounts for 20%. But despite this, social learning is still not well-integrated into everyday practice.

Albert Bandura’s social learning theory indicates that people learn from others. One component of this is behaviour modelling – our brains literally encode new skills and behaviours by watching others perform them. This modelling can come from both the individual’s manager or their team. When this behaviour modelling is rewarded– for example, with praise from team members or the employee’s own sense of personal achievement, the employee becomes encouraged to continue this behaviour.

When combined with giving and receiving constructive feedback, social learning can bring the team closer and accelerate individuals’ capability in those skills and behaviours.

Reinforcing positive performance to accelerate results

People learn faster through positive and immediate feedback that is contingent on tasks completed. Traditionally, this feedback is seen solely as the manager’s responsibility. But when more people provide this feedback regularly, faster learning occurs. Good work is produced more efficiently and improvements are addressed sooner. And, the learning loop is decreased from 6 months (or a year!) to 1 day or less. The benefits of this rapid feedback loop is evident in high performing teams.

Our performance achievement model coming soon!

INS understands that teams play a crucial role in an individual’s performance development, and this is currently missing in all performance development and achievement models in the market. We have developed a model that embeds all the science of individual, team, and organisational performance to provide a simple recipe for achieving consistent high performance.
Our Performance Achievement model is compatible with contemporary models and complements them in areas that are lacking. Furthermore, it is grounded in, and builds upon, your organisation’s Capability Framework.

INS Performance Achievement is all about creating an environment of simple behaviours that bring about achievement.

We are excited to announce that this new and improved performance model will be introduced soon. We look forward to helping you better your organisation’s performance achievement processes.

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