Performance management is critical to innovation in that it ensures that people, teams, and organizations are functioning optimally. It's important to keep in mind, however, that there are many definitions of performance management. We define it as a structured process for setting goals for individuals; for enhancing capability to achieve those goals; and for monitoring and evaluating progress against goals.
Successful organizations use performance management systems to ensure that individuals and teams are willing and able to support organizational goals. Some organizations use an informal process, but we find that formal performance management systems--that include a formal performance appraisal process--tend to facilitate better alignment, clarify expectations, and serve as vehicles for documentation and follow-up.
Although we don't use the term "Performance Management" to describe the goal-setting process at the organizational level, we believe it's critically important that strategic plans, operating plans, and performance scorecards contain goals and objectives that are broken down into specific tasks, accountability mechanisms, and timelines. This ensures that performance is being managed at the organizational level as well as individual levels. However, for purposes of this brochure, our focus is on how the performance of individuals and teams, collectively, drives organizational performance and builds the capability and capacity that's critical for innovation. __________________________________________________________________________________________
Performance Management Systems and Scorecards Performance
management systems are used by the
majority of the clients we work with, to ensure that strategies,
goals, and objectives are met effectively, efficiently, and on a
consistent basis. The core elements of these systems, as they relate to
individuals and teams, include: performance goal setting, job
descriptions, performance standards, performance appraisals, measures,
intended outcomes, performance discussions, performance plans,
Core elements of systems related to
organizational performance include strategic planning, operational
planning, day-to-day decision making, risk and portfolio management,
etc. Most importantly, the measuring, monitoring, and management of
performance should be ongoing and well-integrated into all key business
processes. By that we mean that performance management shouldn't be
viewed as an event (i.e.,
a once-a-year formal meeting to evaluate individual performance or
quarterly monitoring of organizational performance.) Performance
management, for individuals and organizations, is predicated on ongoing
ensures alignment and that facilitates mutual understanding of goals,
objectives, and desired outcomes.
Equally important is to have a scorecard that assesses how well individuals, teams (and ultimately organizations) are meeting goals and objectives. A well-understood performance scorecard is basic to high performing
individuals, teams, and organization itself, so the design of the scorecard is critical. We like to use "balanced scorecards" that
define organizational performance is dimensions that go beyond mere financial
On other pages of this site, we describe many factors that are involved in creating a culture of innovation, but clearly performance management systems, with their organizational scorecards, performance appraisal processes for employees and leaders, individual development plans, etc., are needed. Cultures with a strong performance orientation most often facilitate innovation as well as specific outcomes such as:
financial and other gains
improved responses to organizational change
effective communication of goals, objectives, and performance expectations
ongoing transparency that enhances goal achievement
compensation that's better aligned with results
development plans that are directly linked to individual and organizational needs
high levels of employee engagement (because associates understand how their contributions affect organizational performance)
But performance management systems, in and of themselves, can't guarantee strong performance. Occasionally there are situations where people lack the requisite skills or motivation to meet basic requirements. __________________________________________________________________________________________
Successful innovators know that performance problems at an organizational level often call for quick responses. Sometimes problems are the result of an inexperienced leader or one who lacks critical competencies. In cases where problem performance is at the individual or leadership level, corrective action should honor personal dignity and, in some cases, previous contributions.
An external coach can often help individuals develop or enhance required competencies or can help to address other performance barriers, such as behavior and attitudes. In other situations, redeployment and other options might need to be considered. Another way to address performance problems--at both individual and organizational levels--is to utilize an objective assessment process such as gap analysis. This identifies the degree to which a gap is occurring, between current performance and performance expectations or intended outcomes. Gap analysis also tends to ensure objectivity and places the focus on desired results, rather than inadequacies.
If an organization has a Human Resources Department, leaders may want to utilize the expertise of an HR professional who can guide them in constructing and implementing performance improvement plans. In our Service Function Transformation brochure, we recommend that HR professionals function as internal performance management consultants. In cases where an associate or leader isn't meeting performance expectations, it's typically advantageous to apprise the HR Department of the situation early on, when there are generally more options available for corrective action. __________________________________________________________________________________________
Redeployment and Career Transition
In our Coaching brochure, we provide a detailed description for remedial coaching that is often provided as a "last chance" option for associates or managers who have not responded to previous performance initiatives. As the term "remedial coaching" implies, this type of coaching is aimed at improving problem performance that may be due to poor job fit or to a lack of one or more critical skills. Remedial coaching is typically facilitated through two-way and three-way meetings at different stages of the coaching process. If there are no formal performance criteria in place, it is typically established during this stage and monitored throughout the coaching process.
Remedial coaching utilizes 360-degree feedback and other assessments to identify blind spots or skill and competency gaps. Three-way meetings focus on reinforcement of new behaviors and skill sets or continuing areas of concern until a decision can be made, regarding continuation in the current role or reassignment to a position that better utilizes existing skill sets.
Some clients benefit from remedial coaching as a "last chance" that might provide added incentive to make changes. Others might not be capable or willing to improve their performance. Yet a remedial coaching process is often considered successful when it facilitates an ending for both parties. An experienced coach can often achieve a win-win scenario and smooth transition by helping all parties focus on other options, such as skills or leadership training, additional coaching, redeployment (to another position within the organization), or career transition to another position outside the organization. __________________________________________________________________________________________ To the extent that a high performing organization often requires individuals and teams to develop new skills or enhance existing skill sets, performance management is often associated with leadership and team development, career planning, and talent management programs. (To read more about this, see our pages entitled Leadership Development, Team Development and Talent Management.) _____________________________________________________________________________________________________________________________________ To read what clients say about our performance management services, click here. __________________________________________________________________________________________
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