“performance management: building a culture of …sahrma.org/sessions/adrian guardia - performance...
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“Performance Management: Building a Culture of
Continuous Improvement” Adrian B. Guardia PhD, SPHR
May 9 – 10, 2013 San Antonio Human Resource Management
2013 Symposium
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Performance Management
Organizational Culture
Performance Management: A continuous process of identifying, measuring, developing the performance of individuals & teams. Aligning performance with the strategic goals of the organization. (Aguinis, 2007)
Organizational Culture: A pattern of shared basic assumptions that the group learned as it solved its problems of external adaptation & internal integration, that has worked well enough to be considered valid &, therefore, to be taught to new members as the correct way you perceive, think, and feel in relation to those problems. (Schein, 1992)
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Four Questions the CEO Should Ask about the Performance Management System
1 • What is the purpose of our
PM system?
2 • Does our PM process
support our company goals & objectives?
3 • How can we make sure our
system works?
4 • Would our PM process
survive a legal challenge?
Role of the CEO in Performance Management:
• Model effective performance management w/ the executive team.
• Establish clear expectations of performance management for all staff.
Source: SHRM Foundation, Four Questions the CEO Should Ask About Performance Management
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Source: SHRM “Building a High-Performance Culture’
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Past Attempts to Improve Performance Management
• Objectives, behaviors, results, competencies
Change what is rated
• Differentiated scales, i.e., 1 – 5 or narratives
Change the rating scale
• Supervisors, peers, customers, self
Change the rater
• SMART, cascaded, individual, team
Change the goals
Source: SHRM, “Building a High-Performance Culture”
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Performance Management: Emerging Trends
Source: Deloitte, “Human Capital Trends 2013”
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Alignment & Performance Management
Goals/Values/Policies • Understand company goals & strategy • Understand dept goals & fit • Understand how my job supports strategy • Low vs high value activities • Clear priorities • Aligned accountabilities • Aligned performance metrics
Brand • Understand brand promise • Organization living brand promise • Resources/decisions consistent with brand promise
Customer • Understand customer expectations • Performance linked to customer • Adaptability to customer/market changes
Source: Society for Industrial and Organizational Psychology, “Performance Management”
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Strategy Alignment: Strategic Goals
Source: Society for Industrial and Organizational Psychology, “Performance Management”
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Alignment: The Strategic Scorecard
Source: Society for Industrial and Organizational Psychology, “Performance Management”
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Business Impact of Low Alignment
Confusing brand promise
Many urgent but not important activities
Non-competitive costs due to low productivity resulting from mis-directed activities or talent
Burn-out – working hard, but not smart
Overstaffing, to compensate for time lost on low-value activities
Slow strategy execution Low teamwork; high
conflict across interdependent units
Talent loss Low customer
satisfaction/loyalty
Source: Society for Industrial and Organizational Psychology, “Performance Management
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Performance is multi-dimensional. Behaviors have the capacity to advance or hinder achievement.
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Developing a High Performance Culture
Motivate Change • Assess
current & identify future state
Lay the Foundation • Eliminate
non-value demands
• Introduce new concepts
• Get the ‘right’ people on the ‘bus’
Sustain Behavior • Provide tools
& resources to drive change
Evaluate & Improve • Hold leaders
accountable for continuous improvement
Source: SHRM “Building a High-Performance Culture’
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Drivers of High Performance O Clear, agreed upon vision & strategy O Translation of vision & strategy into clear,
understandable goals & measures. O Acceptance or passion for vision, strategy, goals
among those who are implementing them. O Clarity regarding individual roles & requirements in
supporting strategic goals. O Sufficient capabilities to deliver the behaviors
needed to reach the goals. O Clear, timely feedback on goal attainment & drivers
of those goals. O Meaningful incentives to encourage employees to
develop or deploy capabilities to achieve goals.
Source: SHRM “Building a High-Performance Culture’
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Performance Management
System
Strategic
Administrative
Communication
Developmental
Organizational Maintenance
Documentation
The Performance Management System
Source: Aguinis, 2007
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Pre-requisites
Performance Planning
Performance Execution
Performance Assessment
Performance Review
Performance Renewal &
Re-contracting
Mission, Goals, Job Functions
KSAs, Behaviors, Results (standards)
Observation, Feedback, Resources, Reinforcement, Documentation
Self appraisal; Discussion
Performance discussion; Feedback, Action Plan, Follow up
Monitor of Action Plan Progress & Development
The Performance Management
Process
Source: Aguinis, 2007
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Traditional vs Behavior Change
Traditional Training Behavior Change
O Typically manager only O Primarily on navigating the
formal process O Often disconnected from
on-the-job realities O No accountability for
learning or application O No reinforcement on the
job
O Training provided for both managers & employees
O Deeper dive, focusing on the knowing/doing gap
O More individualized using assessment results as baseline
O Uncovers underlying fears & attitudes that prevent change
O Accountability for learning & application
O Tools to facilitate change
Source: SHRM “Building a High-Performance Culture’
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Why Do Performance Management Systems Fail?
O Performance management vs. performance appraisal
O Discipline gap O Accountability O Measurement scarcity or overload O Lack of balance (eg., short vs long term; single vs
multiple shareholders O Failure to assess impact in helping execute
organizational strategy
Source: Society for Industrial and Organizational Psychology, “Performance Management
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Diagnosing the Causes of Counterproductive Work Behavior
O Individual Contributors – substance abuse; family problemsJob
O Context Contributors – relationships w/ supervisors & co-workers
O Feelings of Injustice – perception of inequity
O Job Dissatisfaction – Herzberg’s Hygiene Factors; Maslow’s Hierarchy of Needs
O Situational Constraints – environmental factors (resources; encouragement)
O Organizational Climate – respect; expectations focused
O Discretionary effort – sub-optimization; doing only the minimum
Source: Society for Industrial and Organizational Psychology, “Performance Management
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Key Priorities: Improving Discretionary Effort
O There must be no discretionary or untapped effort by the organization when it comes to recruiting, hiring, and retention.
O Sustained high levels of effort require training, retraining and training again to keep skills sharp.
O Supply the equipment, tools, and resources to support excellence.
O Organizations that demand optimal effort and performance must be willing to share the rewards.
O Work-life balance.
Source: SmartBrief, “Closing the ‘Discretionary Effort ‘Gap”
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Dealing with Counter-productive Work Behavior
Punishment
Progressive Discipline Termination
Self-Management training for improvement
Positive discipline Employee Assistance Programs
Non-Punitive Approaches
Alignment Corrective & Constructive Feedback
Source: Society for Industrial and Organizational Psychology, “Performance Management
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Strategies to Improve Performance Management
Develop others through experience Managers accomplish more, succeed faster
& focus on what they want to do. Employees grow, develop & advance more
quickly.
Provide ongoing expectations & feedback Managers gain high-quality work from staff
more quickly w/ less rework. Employees perform better work & feel more
confident about their contributions.
Communicate the big picture Employees contribute more when they
understand the big picture. Employees fee more connected & make wiser decisions, increasing engagement & results.
Benefits for Managers Benefits for Employees
Source: SHRM Foundation, “Building a High-Performance Culture”
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Methods for evaluating Performance Management System
Number of individuals evaluated Distribution of performance ratings Quality of information Quality of performance discussion meeting System satisfaction Overall cost/benefit ratio Unit-level and organization-level performance
Source: Society for Industrial and Organizational Psychology, “Performance Management”
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Performance Management Guidelines Based on Case Law O Evaluate employees on job-related factors. O Inform employees of expectations & evaluation standards in
advance. O Have a documented process with specified roles for managers
& employees. O Train managers & employees on the performance
management process & relevant skills. O Document justifications for rewards/decisions by managers. O Provide timely feedback on performance issues. O Allow employees to formally comment on & appeal evaluations. O Make sure evaluations used for decision-making are
consistent with decisions. Source: SHRM Foundation, “Building a High-Performance Culture”
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Performance Appraisal: Best Practices
Strategic congruence Thoroughness Practicality Meaningfulness Specificity Identification of
effective & ineffective performance
Reliability
Validity Acceptability & fairness Inclusiveness Openness Correctability Standardization Ethicality
Source: Aguinis, 2007
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Q & A?