The Future of Performance Management

Posted by April Parks, M.S. Conflict Management

Sep 22, 2015 11:00:00 AM

Performance-ManagementPerformance management practices have changed drastically throughout the years. We are seeing companies switch their methods of performance management and it appears that these changes are for the better. Especially with a growing number of millennials in the workforce, it’s crucial that companies change their ways of managing performance in order to accommodate the majority group of the workforce. Since millennials are so tech savvy and in the know with the latest apps and online gadgets, it’s important companies offer a performance management method that is efficient, quick, and accessible anywhere, anytime. 

One company in particular that has made drastic changes to their performance appraisal methods is GE. GE found that the annual review type of performance management wasn’t giving employees or the company the benefits it needed from a performance review. GE was using the “rank and yank” system commonly called the bell curve rating system.

Even though the company stopped using the bell curve about 10 years ago, they are making more changes to how employees are evaluated on their performance. Instead, GE is moving towards using an app that will encourage communication and feedback among its employees. GE’s head of HR Susan Peters said that the annual performance review became a ritual instead of a tool that could be used for employee development and accomplishing goals moving forward.  It was “ineffective at boosting performance, it actively alienated employees, it’s based on a flawed understanding of human motivation and was often biased or arbitrary.”

Because of that, the annual performance review became obsolete. GE decided to come up with an app that was readily and easily accessible for employees. The app allows employees to get feedback constantly, faster, and via their mobile devices. Employees can be connected and inspired to do their best and accomplish the most.

Here’s how the app works:

Employees are given a set of “priorities” and managers are part of frequent discussions, “touch points.” Through touch points, managers give feedback to employees on their progress towards their list of priorities. Through the discussion, employees and mangers take down what was discussed, what things were committed to by each, and how to accomplish those commitments. This app is not focused on the old school grading system; it’s a means to constantly improve employees’ skills and understanding of their role with the company. What’s most important is that employees receive feedback and are part of a conversation with their manager, their coach.

Its strides like this that will change the look of performance reviews forever. Since the workforce is majority millennials, companies must make changes or they won’t get the talent they need in order to be a successful company. Giving feedback on a regular basis and setting goals together or as a team can be effective, unlike the annual review where employees are simply given a grade for the entire year. Why not develop a method to see what employees can bring to the table for tomorrow and in the future- their long term contribution. Look at ways to improve skills and what the best way is to achieve goals or team priorities. Performance reviews have evolutionized with the changing of the workforce from mostly baby boomers to more millennials. Look to the future and make your company’s performance reviews better. It doesn’t necessarily have to be an app but it should be tech and user friendly. When employees feel their efforts are recognized through a constant feedback system or check-ins, or whatever your company sees as its best option for communication, they’ll appreciate the time mangers took to comment on their progress and achievements. It shows the company cares and will ultimately improve the overall outcome of the company’s success.

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Topics: Performance Management