11 Feb 3 Companies with Amazing Performance Management Models
If you’ve struggled with performance management, you may wonder how the top performers in your industry do it successfully. Although it’s a complex undertaking, examining some of the biggest and best names in performance management can yield important insights. Interestingly, what you begin to discover is that for top performing companies, “performance management” is more about “performance empowerment.” Take a look at what these three top performers do.
With more than 65,000 employees, it’s not surprising that Deloitte decided that its complex performance-management system had gradually drifted out of sync with its immediate objectives.
In particular, Deloitte identified two key failings in its old system:
- It relied on an evaluation process that consumed nearly 2 million work hours annually.
- It relied on performance ratings that were often inconsistent and that did not account for the subjectivity of the evaluators.
After undergoing an honest examination of its own practices and commissioning a rigorous in-house study, Deloitte transformed its performance-management model, instituting these key ideas:
- Performance management should focus on recognizing good performance.
- Performance reviews should be future-focused, not past-focused.
- Performance reviews should prioritize feedback from an employee’s direct peers and supervisors; however, management considers the subjectivity of this feedback during the process.
2. General Electric
General Electric used to be one of the strongest proponents of the “annual everything-at-stake performance review.” Also known as “rank and yanks,” those reviews led to yearly firings of the bottom 10 percent of employees.
To replace that system, the company gave power back to its managers. The new mission of managers is to more organically support their people without a strictly defined ranking system. General Electric managers now work with employees throughout the year, shifting focus from evaluation to goal-setting and aspirational guidance.
As the number-one ranking company in Fortune magazine’s “Top 100 Companies for HR,” it’s no surprise that Accenture does performance management right.
Like General Electric, Accenture decided that a rigid ranking system is ill-suited to encouraging high performance from employees because it often simply rewards those who are best at playing inter-office politics. In response, the company pivoted from performance evaluation to performance development. In a multi-faceted process, employees work with their superiors to set goals for themselves. Then, employees work throughout the year to achieve those goals, all supported by internal feedback mechanisms like an easy-to-use app.
Adopting Best Practices
While these top performance-management companies are all large, international corporations, it can be even easier to institute a best-in-class performance-management system if you’re a smaller organization.
Enhancing your performance management begins with finding an effective way to define and measure organizational-performance metrics, and by using process that empowers your people to do their best work. If you’re interested in learning more about how to improve your organization’s performance management, contact us today for a free organizational-performance assessment.