A Modern Day Business Fable

castle-foyerOnce upon a time, there was a small but beautiful castle, tucked under a mountain outside the city.   The castle had been in the William’s’ family for generations, and had a long history of splendor and opulence.  Old Mr. Williams loved the castle and tended it carefully until he got too old to work.  When old Mr. Williams passed away, the family donated the old castle to the state historic Society, as the family and the castle could trace their roots back to a famous person in history.  The Director of the Society was excited to renovate the castle, and hired a contractor to restore it to its early grandeur.  They had a limited budget for the renovation and realized that the renovation would have to take place over a long period of time, but The Society was very interested in opening at least part of the building to visitors as soon as possible.  They conveyed this to the contractor.

The contractor who successfully bid the project was called Bert, and he hired two subcontractors to supplement his own skills.   The first subcontractor, Harry, was quiet and gruff, but a very competent builder.  Harry had performed renovations on old buildings for many years, and was considered an expert on foundations and stability of old buildings.  The second subcontractor, Franz, was effusive and charismatic – a decorator known throughout the community for his wonderfully creative works.   Bert had worked with Franz many times before, and really enjoyed those times because Franz involved him in the decorating – Bert’s long-time avocation.  Continue reading A Modern Day Business Fable

Too big to fail?  No, too big to succeed

skyscraper-2Although my professional experience is in very large organizations, we now work with smaller clients. This work has helped to change my paradigm about those processes that organizations put in place to engage their workforce, and measure the progress of engagement.

This revelation – that big companies try to mandate relationships between leaders and their employees through bureaucratic programs – has been evolutionary for me. Heck, I spent my career designing bureaucratic performance management processes, chasing non-conforming managers down, and cleaning up the misunderstandings when their communication style angered an employee.

I get it, I do. When an organization is so big that those who run the organization never, ever see those who do the work, there has to be a process by which leaders are held accountable for leading without getting the organization in trouble.

But the more I work with smaller clients, the more I realize that you can’t mandate an engaging relationship between leader and employee. That must be authentic in order to truly engage. Following the myriad steps in a process without the heart or skill to be authentic results in cynicism, and does just the opposite of engaging: it tells the employee not to bother.

Take the case of a huge organization’s talent management program.  In fairness, a huge organization needs a mechanism to identify and groom talent across a wide footprint. So they create a talent management process….1.) rate everyone, 2.) calibrate the ratings so that not too much cream rises to the top, 3.) go back and “share” the feedback.

Calibrate.  It sounds good.  I used the term myself in my corporate days to explain the process of leaders defending their ratings. Some of the reasons?  Well, leaders tend to inflate ratings, and we didn’t want them giving messages of excellence when the work is really average.  So we graph the ratings hoping for something similar to a bell curve.  After all, average is actually good, right?

Not so fast. No one wants to be average. So we came up with a new term….meet expectations. Then, because no one wanted to just meet expectations, we added some adjectives….consistently, almost.

When I look back on the amount of time we spent wordsmithing the process to make ratings palatable to those receiving them, I do so with the clarity of hindsight, and a little help from smaller organizations.

Today, my clients are exploring doing away with ratings.  Eek, you say….how do they measure and calibrate?  Well, by talking. The quality of conversation becomes a key talking point up the chain of command, with as much weight and interest as budget and operational measures. We also go to the source:  “are you receiving helpful feedback from your leader?” After all, if you really want to improve engagement, don’t you really want to know the truth directly from the employees?

Case in point. A big organization finished their “calibration” session for their annual talent management program. A leader was “sent back” to talk with her employee and share a rating that was less than what she actually gave the employee, based on her personal interaction and observation of the work. Why? Because there were too many with that rating.

How do you think the conversation went?  “So, I’m really pleased with all of the work you did this year.  You completed all your goals, and brought in a project ahead of time. Your rating is [3 on a scale of 1-5].”

“Um,” says the employee. “If I did as well as you are telling me, why am I only [a 3]?”

“Well,” stumbles the leader, “I did try to rate you higher, but wasn’t able to defend it in the calibration sessions, so they made me reduce the rating.”

So much for authentic conversation.  No matter how hard that leader tries, she can’t be authentic with that employee.  And the employee? Well, why should he work so hard?  Why not just sail along?

There is a better way. It’s harder, and messier. It’s called real open communication and dialog with a minimum of bureaucratic process intervening.

Why do you need a rating?  Is it for the employee?  It sure isn’t.  It is for the leadership and Human Resources folks to use to measure compliance, to force leaders to do their job and to defend claims that might arise.

Here is my challenge to anyone in Human Resources who is designing a talent/performance management process.  Before you create a hierarchy of ratings, think carefully about why you are doing it.  If you can’t draw a line back to some benefit for the employee, don’t do it.

Put your energy toward dialogue.  Help executives recognize the value of real relationships and real engagement.  Take that time you’re putting toward calibration, and put it toward honest dialogue.

The last decade has seen many companies bailed out because they’re too big to fail.  Perhaps those same companies are too big to succeed?  If bureaucracy is leading the company instead of authenticity, that’s a problem.

If you think I’m alone in my recent disdain for traditional performance management, watch this.

What do you REALLY want to do with performance management?

progressThere has been a significant increase in articles about performance management in my inbox lately, so for the last month, I saved them all with the intention of seeing if there was anything I could add.  I kind of consider performance management my “niche,” and have always believed there was value in the process.

I’m thrilled today to see organizations addressing those very things that turned off both leaders and employees: the awkwardness of the pay discussion, the ridiculously long forms that took hours to prepare, self-evaluations that really made no difference in the outcome of the appraisal and finally, the ratings.

With six links in my inbox I set out to see what’s happening. Two were webinars, one infographic, and three e-books or articles. All seem to indicate that the traditional one-way, annual, formal process is giving way to a more collaborative exchange of knowledge, needs and expectations. I absolutely agree.

The jist of recommendations includes eliminating the term “management” which implies control, increased frequency, using a neutral location (I like that – less formal), being transparent about the process, focusing on future and growth, and developing leaders.

All good.

As with so many business articles that talk about shifting paradigms, I am missing the crucial elements of “how do you really make it work.”  Let’s talk about those.

Clear the slate

First, get rid of the notion that HR can design a program in a vacuum or overlay a “best practice.” For too long we’ve been doing that, using vendor solutions, implementing someone else’s program, and assuming that a good program must include specific elements. Now is the time to get creative and push all those solutions away until you have figured out what you want to happen with your program.

We are beyond the days when rankings were required to allocate a healthy merit budget; we just don’t need rankings anymore.  We’ve focused on “documentation” so that we can defend management actions; we can’t motivate commitment by forcing compliance.  We no longer need the voluminous forms; no one ever looks at them anyway once they land in the employees’ file.

Get everyone involved

Start with the question, “Why do we event want a performance management program?” Ask everyone, and then draft a purpose statement. Facilitate a discussion about that purpose statement, validating that this is, in fact, the outcome you want and are willing to invest in.

This is the single most important element of new program design. Why? Because unless folks know why they are doing something and agree on the process, agree on the importance, and indicate that they have both the capability and capacity to execute, they’ll pay lip service.  These are the same folks that have been telling us that existing performance management programs are broken and we haven’t listened.  It’s time to listen.

Design, launch and tweak

Armed with a purpose statement, we can now explore solutions, be they vendor, best practice or otherwise. Carefully match the purpose statement against the solution; does it do ONLY what the purpose statement says.

The solutions adds more that the purpose statement defines? Go back to the audience and make sure that “extra” is important, and that they have the capability and capacity to execute well.

It’s always better to start small and add. Most organizations have a bunch of overworked leaders and employees who would welcome a shorter, more value-added process.

Evaluate, evaluate, evaluate

And here is the secret sauce. Now that you have a purpose statement, get that same groups of stakeholders to agree on how you will know if it is working. We’ve allowed a broken system to exist for several years, but we don’t have time for that anymore, and our stakeholders are rebelling.

But any time spent should be time spent wisely; after all, you’re paying for every hour involved.

How are you going to measure it? It depends on your purpose statement. If your purpose includes improving engagement and reducing turnover, there’s your measure. Use it as a learning tool, rather than a judgment. If your engagement scores don’t improve, are the leaders really leading the process effectively? If not, why not.

If your purpose includes improving organizational performance, how will you measure that? Again, the outcome isn’t to be rewarded or punished, but instead to help the organization learn. Why didn’t it do as expected? Is there a tweak we can make?  Are leaders being held accountable? Do they know what to do?

Any process can be a good process

Every solution out there can work, but it isn’t as simple as implementing a solution.  What is important is what happens before and after implementation. Being clear on the purpose and expected outcome enables measurement of results.  And that tells you that the process is working, that the time invested is time well spent.

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