Do We Really Want to Work for Performance Driven Organizations?

Victor Velazquez Patron, Vice President People & Organization Development,Clip

Performance evaluations should represent an opportunity to reflect on our past actions, celebrate achieved milestones and set goals for continuous improvement.

An objective point of reference to enable individual growth.

Big and small companies alike invest plenty of resources behind talent systems and processes to guarantee top performers are objectively identified and rewarded for their contributions. If successfully done, organizations should see material improvements in their collective results, talent density, and leadership capabilities.

Many organizations take pride in how they evaluate talent and incentivize a performance driven culture, in which top performers progress through the ranks and bottom ones are forced to leave the company to open space for up-and-coming talent eager to outperform the person beside.

Rating distributions, performance calibrations, and nine-boxes placing (among others) are widely known elements of best-in-class talent systems and automatic security blankets for leaders who are questioned about the fairness in the way talent is evaluated and measured under their watch.

Yet in most cases,the reality is far from the theory and what are considered robust talent processes are merely the genesisof stagnant performance and regretted attrition.

Performance evaluations are linked to stressful situations in which individuals focus on bypassing subjective processes to navigate in a safe zone for another year, meet the minimum criteria for the end-of-year bonus payment, or, in the best case, successfully showcase pre-defined yet subjective qualities for career progression.

For years I both facilitated or participated in performance calibration exercises where the outcome was pretty much the same despite being held for different businesses, geographiesand/or functions.

Prior to the much-awaited forum, the whole organization under review gets highjacked from their responsibilities for several weeks to prepare the material to support a proposed rating.

Hundreds of individuals leave their business priorities behind to dust off an old objectives agreement and accommodate their yearly results in the best way possible. The fancier (and more confusing) the wording, the better chances to look good in the eyes of others.

Theusual lobbying and alliances take place ahead of discussion time, and once rating distributions are shared fairly across teams to ensure the whole organization is motivated, the people under the scope to be discussed reduce drastically.

Those who really do achieve outstanding results or the ones whose representative is able to speak the loudest or most eloquently benefit equally from the exercise.

The highest ratings getassigned to the usual suspects; hence most people will settle by staying in the "safe zone" rather than striving for the top spots. In the end, upper placement is limited and being compared against the best might be too intimidating or even pointless in the minds of strong, not yet lead performers.

Ultimately, nobody wins.

The organization, in general, will invest plenty of time to avoid falling into the bottom category instead of attempting to accomplish the extraordinary. Managers and leaders avoid their responsibility to objectively discuss performance with their direct reports behind the excuse of limited influence on the process outcome. Most individuals get tired at some point and look for external opportunities where their expertise and experience can be recognized and rewarded better and fairer.

On the last point, I have always found it strange how companies take pride in the number of Alumni working as CEOs in other firmsdespite not outperforming them in general. It's a strange celebration of talent loss.

So what can we do?

1)Shift from a performance driven to a growth mindset and ensure your talent management ecosystem is designed for such a move.

Healthy competition incentivizes improvement in any discipline, yet competition should be against oneself and not your teammate or closest collaborator. If talent attraction is to be done correctly, we should focus on something other than who is the best among a group rather on how to bring the best out of everyone's potential.

"The emerging technology companies have influenced performance management thinking towards shorter cycles, OKRs goal setting and agile planning, among others."

If I compete against myself, I will objectively see the value of improving and become self-motivated to become a consistently better version of myself.

Learning & development areas should be ready to provide individuals with the right learning experiences to support their growth paths, opposite to a one size fits all approach.

2) If anything needs to be standard is the quality of goals/objectives assigned.

Companies should invest plenty in ensuring all leaders alike can objectively assign challenging goals to their direct reports.

By having people compete against themselves, you automatically eliminate barriers and open the possibility of having a true top performing organization; yet leaders must be aware that the base performance will be equal to the easiest assigned objective.

Weak objectives will bring weak results, just as unattainable ones will bring frustration and discord.

3) Make consistent and transparent feedback the heartbeat of your culture.

As a Radiohead fan, I tell my teams that performance management processes should consist of ‘no alarms and nosurprises.’Performance discussions should be seen as a simple reinforcement of the different series of informal and formal conversations a leader and its direct report have had throughout the year.

Feedback should not be tied to a specific season or window alone. It should be provided when and where needed the most; otherwise, it might be given too late to act upon it or when is irrelevant to the context.

The emerging technology companies have influenced performance management thinking towards shorter cycles, OKRs goal setting and agile planning, among others.

We can continue to push forward and try new approaches that favor the actual development of individuals, with an imminent positive impact on the company results against traditional systems that reward a few and hold back many.

Agile

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