Stop the Madness! Ideas for a Better

Taking the Stank Out of
Performance Management
A Very Brief History
Originally developed for a manufacturing environment in 1911
(by Fredrick Taylor)
Brief History (cont.)
Peter Drucker introduced Management-By-Objectives (MBO)
concept in the 1950s (to be used to manage managers)
SMART objectives evolved from Drucker’s concept
(Specific, Measurable, Achievable, Realistic and Time-Bound)
So What’s Changed?
The speed of everything (and the impact on time)!
• Technology
• Less stable, more unpredictable and ultra dynamic business
environment (goals/objectives and jobs are not static)
• Doing more with less resources … constantly
• Workers’ loyalty and expectations (the newer generation has
less tolerance for b.s.)
• Company expectations - need people who can think and do
their jobs with general direction (maps are disintegrating)
What’s Broken?
• The methodology/process … top down = dragged down
• Cascading objectives – good in theory, bad in reality
• Too much time and energy writing detailed objectives; learning
complex software that “automates” the process
• Sometimes the manager is involved; sometimes not
• Objectives sit in drawers/files – dusted off at review time and often
are irrelevant in a matter of months (ever hear, “We need to take a
look at your objectives … now, where did I put them?”)
• Once or twice a year reviews actually retard daily conversations
Performance Reviews Are Coming …
• At 6 months and 12 months – let the moaning, groaning
and scrambling begin!
• Executives, managers and employees dread it
• Writing reviews feels like climbing Everest for some
• Rare to have a really meaningful review
• More like a break-up; let’s just get this over with
The Corporate “Reality”
Time Managers Spend on Performance Reviews
Percent of time
actually spent
writing the
Percent of time
about, fretting,
and dreading the
A Blueprint for a Better Way
• Get support of your executive team if possible (DO THEY
• If you can’t get this, don’t give up. At least improve what you
• You owe this to your organization
• Getting this right/better could be a true competitive
advantage and a way to draw “A” talent
Remove the crud and start with the basics …
Blueprint (cont.)
• Defining Performance = What you do (Results) + How you do it (Behaviors)
• Measuring “What” – assess what got done and the quality, quantity and
• Measuring “How” – assess the behaviors you want
• Agree, communicate and train re: how you will assess: What + How
• Make it effective: simple, practical, understandable and relevant
• Ensure employees know there is some level of ambiguity when assessing –
that is why daily conversations and “coaching in the moment” are so vital
Even Stars Need “Coaching in the Moment”
Putting It All Together
• Evaluate: Day-to-day responsibilities (“What”)
• Evaluate: Goals/objectives if applicable; determined by job level,
adjustable at any time (“What”)
• Evaluate: The behaviors demonstrated (“How”)
• 5-point rating scale – make it intuitive (more about this on slide 17)
• Strive for a one page review format
• Mostly check box with summary narrative
• It’s a report card – it’s not a novel – it’s not a CYA document
You may not like his “how” but his “what” is offthe-chain and I do want him on my track team!
A Word About Rating Scales
Make them intuitive! Stop the jibber-jabber!
Decouple them from the academic grading scale – be purposeful
about this, if that is what you believe
The 5-Point Rating Scale
• Excellent
• Very Good
• Good (if it is good, solid work, call it Good!)
• Needs Improvement
• Poor
That catch far exceeded my expectations. The player went well beyond
his objectives. He is highly accountable and a valued member of the
organization … uh, what???
The Process
Manager receives input from others – employee’s self-rating, customer ratings,
peer ratings, subordinate ratings
Manager reviews and evaluates day-to-day performance
Manager reviews and evaluates performance on goals/objectives (if applicable)
Manager reviews and evaluates “how”
Manager conducts review with employee – targeted, pinpointed conversation
Manager considers and makes any adjustments/revisions; finalizes review
Submit review to HR oversight/analysis
Pay for Performance
• Merit increase reflective of the rating
• No forced distribution ever – most demoralizing thing you can do
• Use of standard merit formula across the company – eliminates
management discretion, department budgets, gaming the system,
promotes fairness and consistency!!!
• No more guide charts or department merit pools
• Will save a ton of time, transparent and fair!
Is the Pain Worth the Gain?
• Gives everyone a common understanding and way to pinpoint
performance discussions
• Promotes daily performance management and conversations vs. waiting
for “the event”
• The new process is straightforward, understandable, relevant, and far less
time consuming
• Feedback from others is now feasible and streamlined
• Saves tremendous amount of time, energy and angst
• Still gets at the heart of what you want to do – effectively evaluate
performance, reward best performers with pay and succeed as a business
And, we can all aspire to be …
Please feel free to contact me:
Tim Moran
TMoran Consulting
Two requests:
1. If you are a slow driver, stay out of the passing lane!
2. If you say you are going to follow-up with someone, please
do so.