Why We Need to Change Performance Management to Talent Development

Photo by istockphoto
Photo by istockphoto

To Our Readers: This week, TLNT is continuing our annual tradition by counting down the 35 most popular posts of this past year. This is No. 27. Our regular content will return Wednesday January 2, 2013.

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Performance management. Let’s think about that for a minute. When you Google the word “management,” here is what you get:

  • The process of dealing with or controlling things or people;
  • The responsibility for and control of a company or similar organization.

It’s all about control. A logical person might conclude that a process called performance management has at its core the intention to control performance. And they’d be right!

Why performance management doesn’t work today

Performance management was created to manage (i.e. control) the work of an industrialized workforce to maximize output. No thought was given to the development of the individual.

Fast-forward to today and the rise of the knowledge workforce, which is very different from an industrialized one.

  • One right way –> Multiple right ways, best approach varies with the situation;
  • Maximizing production output –> Creating competitive advantage through best use of talent.
  • Creativity detracts from results –> Creativity is essential for results
  • Command and control –> Collaboration and self-motivation.
  • If-then rewards motivate –> Mastery, autonomy and purpose motivate.

It’s no surprise that a process created to control the output of a workforce where work was standardized and repeatable doesn’t work as a tool to develop a knowledge-based workforce. No matter how much you massage around the edges.

I won’t quote a bunch of survey statistics here because, unless you’ve been living under a rock, you’ve seen them – over and over and over. So has your CEO. What you may not know is that it’s also expensive, rolling in at about $2,000/person.

Practical ideas that may help

What I haven’t seen in any of my research is data confirming that performance management is delivering on its objectives. Not. Once.

Article Continues Below

It’s time for us to change our lens from performance management to talent development. And I believe HR needs to lead the way. Your leaders are waiting for new ideas from you.

While surveys and research findings confirm the problem, not many address the solution. So I’ve provided some practical ideas to help you get started.

  • Unbundle. Stop relying on one jumbo process; done once or twice a year, as the basis to drive all your talent-related actions. Take a close look at what you are trying to do with performance management and unbundle those activities.
  • Cultural shift to continuous feedback. Begin building the foundation for a cultural shift to valuing and encouraging feedback. Change the notion that feedback only goes top-down. Encourage people to get and give feedback in any direction. Emphasize the idea of agility and feedback when needed. There are lots of good tools out there that can enable this. Two of my favorites: Rypple and Cleargears.
  • Invest in improving feedback and coaching skills. Enable your workforce to both give and receive feedback effectively. For years, we’ve trained people to participate in a months-long process where the outcome is to give a grade. This does nothing to prepare them to effectively coach and develop each other. Helping people at all levels in the organization build this capability signals a shift in perspective from identifying weaknesses to capitalizing on strengths; reinforcing a cultural shift from judging and grading to coaching and development. And it’s a much better spend of your $2,000/head! Feedback and coaching support innovation and creativity much better than assessing and grading do. And, helps to shift responsibility for growth to the individual by empowering them to ask for feedback versus waiting for the scheduled time for it to be administered from above.
  • Succession planning with a purpose. Make talent reviews and succession planning an ongoing dialogue with leaders. These discussions are critical to helping you understand where you have deep bench strength and where there are gaps that need to be closed. Follow-up on agreed actions and share insights with those being discussed, encouraging people to take an active role in the planning and execution of their development activities.

When HR professionals shift their focus to talent development and bring fresh, creative ideas to leadership, they get a seat at the table that is truly value-added. They become an advisor to the business around talent, driving value to the bottom line by linking an organization’s talent strategy to its business strategy.

Which, let’s face it, will be one of the biggest challenges of the 21st century.

This was originally published on PeopleResult’s Current blog.

Kristi Erickson is a Partner at PeopleResults, a consultancy that guides organizations and individuals to “start the wave” of change. She specializes in organizational design and talent development and has advised many clients on achieving competitive advantage through best use of their talent. Kristi was previously a Partner at Accenture, and she also serves on the board of Dallas Social Venture Partners. Contact her at kerickson@people-results.com.

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