Building a High-Performance Culture: A Fresh Look at Performance Management. The Forum applies the 70:20:10 Lens
This paper published by the SHRM Foundation - part of the Society for Human Resource Management – takes a new look at performance management.
It’s not a quick read, but it is worth spending time with it.
The heart of the argument is laid out in the foreword:
“research shows that what truly increases employee performance and engagement is not annual reviews, but the day-to-day process of managers communicating expectations, providing feedback and leveraging employee talents”
The authors argue that the focus of most performance management - on administrative processes, following the ‘performance management path’, and enabling the organisation to deal with poor performance - is targeting the wrong things.
Performance-based cultures arise from good communication and strong relationships, not from structured processes. Workforce effectiveness and agility, and cycles of continuous employee development and performance should be the focus. But these outputs tend to get overshadowed.
The paper reports that:
“No more than 30 percent of those surveyed reported that their performance management system effectively establishes goals, provides feedback and actually improves performance”
The authors go on to point out the reality in that that most performance management systems neither drive improved performance nor serve their intended administrative purposes. The authors point out that performance management is more a set of behaviours than a set of processes. The first step in improving performance is to embed those behaviours.
Added to which they note:
“In a recent survey, over 50 percent of respondents reported that they believe performance reviews do not provide accurate appraisals of their work, and nearly 25 percent said they dread performance reviews more than anything else.”
So it seems that not only are most performance review systems ineffective, but for many employees they create a negative impact rather than a positive one.
Staccato Performance Management
One common and major pitfall is that the staccato performance management processes used in most organisations (cycles of mid-term and final appraisal) simply motivate intermittent spurts of activity. Higher performance spikes just a couple of times during a year.
Driving Performance through Continuous Improvement
Research from the Corporate Leadership Council cited in this paper shows that more than half the most important drivers of employee engagement and performance are precisely the behaviours that define effective performance management. These include:
- setting clear expectations
- helping employees accomplish work
- providing regular feedback
- finding new opportunities for employees to succeed and develop
The 70:20:10 Lens
This is not a new story. We have known for many years that managers who are effective at encouraging and supporting their people will release greater effort and productivity while, at the same time, raise engagement. Discretionary effort rises exponentially in teams where leaders lead rather than manage.
Feedback and reflection need to be carried out as a continuous process. Like learning, informal will usually trump formal and the best results are obtained when input is little and often. Real-time feedback and reflection are best.
Achieving this requires line leaders that understand and are equipped to support workplace and social learning and development (the ‘20’ and ‘70’ parts of the 70:20:10 model). Managers who are focused and effective at this achieve an average of 25% performance improvement from their reports. That’s equivalent to an extra day’s work every week.
This SHRM Foundation paper posits informal feedback over formal – spontaneous feedback that relies on two-way accountability and interaction rather than infrequent feedback that is initiated, led and controlled by the manager. It also stresses the importance of trust and trust relationships for effective coaching and feedback (the ‘20’). Without basic trust – both competence trust and benevolent trust – communication becomes difficult and continuous improvement almost impossibility.
The heart of this paper with respect to the 70:20:10 framework starts on page 10. It stresses the importance of developing others through experience.
Performance reviews and objective setting are great opportunities to take a longer view of development activities, but that is if little worth if there is not an on-going discussion and dialogue throughout the year with day-to-day feedback sessions and regular reflective practice sessions.
One technique we recommend to support continuous development and performance improvement is for managers to put time aside in each of their one-to-one meetings with reports to ask three questions:
- “What have you been doing since we last met?”
- “Given the opportunity, what would you do differently”
- “What lessons can you take from your experiences”
If manager and report can have these discussions regularly, and if they can identify opportunities for experiences that develop on a continuous basis, then the need for an annual performance review and development objective setting can almost be discarded.
The role for HR and L&D professionals in this process is to encourage, enable and support managers to become proficient at providing continuous feedback and at managing and facilitating continuous development activities within the workflow.