"Refocusing Performance Management for High Performance"

Howard Risher

Compensation & Benefits Review

September/October 2003, pp. 20-30

The author of this article argues that today's emphasis on high performance organizations calls for a new and different approach to performance management: "The performance system alone, however, is not the key to creating a high-performance organization. It needs to be seen and managed as an element of a broader strategy. It is an important tool for communicating priorities and for providing essential feedback to help employees satisfy the new expectations. When combined with the reward system, it can be instrumental in driving any changes, which are then institutionalized through formal policies, systems and structures.

"Performance management should not be handled as an HR problem. It starts with the business strategy and with plans for managing and organizing work. The difference between poor performance and the potential for peak performance makes it a top management priority. HR needs to take the lead in evaluating the need for new or modified people systems and for supporting managers. Line managers, however, have to be held accountable for managing their people."

Though this article focuses on performance management, probably its most useful aspect is that it provides a list of "action levers" which meta-analysis has indicated to be empirically-verified contributors to improved performance:

1. Top management levers: (a) consistent messages that top management values the workforce; (b) a specific people-management philosophy statement; (c) decisions that recognize the importance of the employees' commitment to success; (d) articulated and publicized organizational mission, guiding principles and core values; (e) regular communication to inform employees of performance results; (f) periodic communication to recognize the importance of employee efforts; (g) past success stories published to build pride in organization; (h) recognition of significant group, team and individual accomplishments; (i) technology and resources needed to meet performance expectations; (j) balanced importance of organization performance and employee personal goals.
2. Organization levers: (a) self-managed teams; (b) employee empowerment; (c) eliminated reporting levels and broaden span of management control; (d) minimal hierarchy and status distinctions; (e) "boundaryless" organization without silos; (d) knowledge management; (e) employee task forces that address problems.
3. Human resource levers: (a) investment in skill building; (b) pay-for-contribution salary increase policy; (c) gain/goal-sharing group incentive plans; (d) results-based performance management systems; (e) banded salary systems to encourage flexibility; (f) competency-based HR systems to focus on employee capabilities; (g) generic job classifications.
4. Supervisory levers: (a) job rotation and cross training; (b) flexible work schedules; (c) regular constructive feedback on employee strengths and development needs; (d) encouragement and support for employees in skill development and learning; (e) teamwork; (f) new duties and broadened scope of their roles for employees; (g) individual and team performance goals and measures; (h) effective performance coaching; (i) provision for ongoing employee involvement; (j) encouragement for taking risks and a "do whatever it takes" commitment; (k) recognition and celebration of employee accomplishments; (l) opportunities for fun at work; (m) consistency in decision making and, when necessary, in discipline.

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