Question:
“I’m a business unit leader for a new business unit for the company. Corporate has told us we have 18 months to show a profit. Financial goals and objectives have been set for the business unit.
Now, my goal is to translate those goals into actions. A major challenge will be for staff members to make stronger connections between the work they do and the performance of the business unit and the company. We are exploring ‘balanced scorecard’ principles and performance appraisals need to be submitted during the fourth quarter. Can you offer suggestions for what I can do to help the employees connect what they are doing with what the company is doing?”
Answer:
Within a management-by-objectives framework, a comprehensive model of goal setting is pursued that links and aligns individual, team and collective performance.
I like to use the metaphor of “pebbles, rocks and boulders” when exploring this issue. Individual-level efforts involve shifting pebbles. Team-level efforts involve shifting rocks. And, finally, organization-level efforts involve shifting boulders. Therefore, if the “pebble shifters” (individual employees) are going to connect with the dots with the big picture at the boulder level (organization-wide performance), they must make tangible connections with the role their work plays at successively higher levels within the hierarchy.
The figure accompanying this column shows the five major elements of effective performance management. Let’s explore each of these in some detail.
Documenting essential functions
In order to identify the context in which the work occurs, it is important to document the essential elements of the job. Job analysis is the means by which this is accomplished. In job analysis, research is carried out, typically in the form of some combination of interviews, surveys, or observations, in order to arrive at a clear picture of the job and what it entails. A job description is an important product of the job analysis.
Establishing standards of performance
Standards of performance are a benchmark against which to evaluate work performance (i.e., “exceptional,” “above average,” “average,” “needs improvement,” “unsatisfactory,” and so on). Standards of performance define how well each function or task must be performed in order to meet or exceed expectations.
Observing and providing feedback
Ideally, performance management is an ongoing process that occurs throughout the year, not just at performance appraisal time. For this to happen, managers have to make observing and offering performance-related feedback part of their managerial repertoires.
Performance appraisal
Observing behavior is not enough if a manager wants to be serious about performance management. Managers must offer employees their perspectives on both what is working (i.e., observed behavior that exceeds goal-referenced expectations) and behavior that is not working (i.e., observed behavior that fails to meet goal-referenced expectations). According to appraisal management companies, performance appraisal is the formal method of doing just that.
Performance development
Once a thorough performance appraisal has been delivered, the most important thing is that it catalyzes behavior, looking ahead. The performance appraisal is evaluative and backward-looking. Performance development is encouraging and forward-looking. What goals will be pursued moving forward? What can the employee expect from the manager in the way of support and guidance? What learning opportunities might be pursued? And so on.
Performance appraisals are commonplace these days. Sometimes they are done well. Sometimes they are not. Over the years, we have developed a great deal of knowledge about what makes them work well. This knowledge has been gleaned from our experience working with many organizations as well as from psychological research. Here is a list of things for managers and leaders to do when carrying out an effective performance appraisal.
- Give advance notice. Employees, generally speaking, like to have advance notice of the appraisal session so that they can think over the past evaluation period and make notes about their successes and mistakes.
- Stick to observed behavior. Evaluate only what you have seen and heard. Do not discuss hearsay. If you do, you risk getting into an endless argument about whether your source actually saw what he or she reported.
- Stick to goals. Know in advance what behavior you want as a result of the session. If you know what you want from the outset, you are less likely to be sidetracked by explanations, rationalizations or excuses.
- Separate the discussion of rewards. If the employee knows that you will reveal the amount of a raise or describe a promotion or other form of recognition during the interview, he or she may not listen carefully to the appraisal.
- Listen to the employee. The successful appraisal is a dialog. The manager must be prepared to listen to the employee, just as the manager expects the employee to listen.
- Control the discussion. The manager should know where the interview is going and what results will be achieved.
- Discuss evidence available to both the manager and employee. Ideally, there should be no surprises in an appraisal interview, especially for the employee.
- Make sure the employee understands problems. When there is a performance deficiency, make sure the employee understands why you regard it as such.
- Obtain commitment to change. Do not conclude the session with vague assurances. Have the employee acknowledge and commit to the specific improvements you want.
- Allow sufficient time. The interview should be open-ended. Take as long as you believe is necessary to hear what the employee has to say and to get agreement on what is to happen.
- Accept the employee’s feelings. The employee may show signs of stress, anger, or disagreement. Accept them. Remember that this is not the same as agreeing or believing that the feelings are justified.
I hope that some of the concepts outlined will be helpful to those who are engaged in the very important process of performance appraisals. The year-end is a very common time for appraisals in many organizations. Year-end is also the time for stock-taking by looking back at what has been accomplished in the year drawing to a close while simultaneously looking forward with excitement to the new year about to unfold.
Perhaps, in doing so, we would be well-advised to heed the words of Dr. Stephen Covey, author of “Seven Habits of Highly Effective People” who noted, “’Begin with the end in mind’ is the endowment of imagination and conscience. If you are the programmer, write the program. Decide what you’re going to do with the time, talent and tools you have to work with…’Within my small circle of influence, I’m going to decide!’”
Daniel A. Schroeder, Ph.D. is president of Brookfield-based Organization Development Consultants, Inc. (www.OD-Consultants.com). He can be reached at (262) 827-1901 or Dan.Schroeder@OD-Consultants.com
