Sources and Acknowledgements:
Most of the below text is adapted (directly and indirectly) from the below URLs. So all credit to the authors of the below articles for the upcoming text.
http://www.washingtonpost.com/news/on-leadership/wp/2015/07/21/in-big-move-accenture-will-get-rid-of-annual-performance-reviews-and-rankings/
http://www.washingtonpost.com/news/on-leadership/wp/2015/07/23/accenture-ceo-explains-the-reasons-why-hes-overhauling-performance-reviews/
Motivation behind the Accenture's change:
1. The firm will disband rankings and the once-a-year evaluation process starting in fiscal year 2016, which for Accenture begins this September.
2. A move backed by current CEO- Pierre Nanterme.
3. Pierre Nanterme's thoughts- "What I learned is that leadership is about letting it go. Trust people. The art of leadership is not to spend your time measuring, evaluating. It’s all about selecting the person. And if you believe you selected the right person, then you give that person the freedom, the authority, the delegation to innovate and to lead with some very simple measure."
"And for the millennium generation, it’s not the way they want to be recognized, the way they want to be measured. If you put this new generation in the box of the performance management we’ve used the last 30 years, you lose them. We’re done with the famous annual performance review, where once a year I’m going to share with you what I think about you. That doesn’t make any sense."
Shortcomings of the traditional system as observed by Accenture:
1. have had enough with the forced rankings, the time-consuming paperwork and the frustration
engendered among managers and employees alike.
2. These companies say their own research, as well as outside studies, ultimately convinced them that all the time, money and effort spent didn't ultimately accomplish their main goal — to drive better performance among employees.
3. “All this terminology of rankings—forcing rankings along some distribution curve or whatever—we’re done with that,” Nanterme said of Accenture's decision. “We’re going to evaluate you in your role, not vis à vis someone else who might work in Washington, who might work in Bangalore. It’s irrelevant. It should be about you.”
4. “Employees that do best in performance management systems tend to be the employees that are the most narcissistic and self-promoting,” said Brian Kropp, the HR practice leader for CEB. “Those aren’t necessarily the employees you need to be the best organization going forward.”
5. CEB also found that the average manager spends more than 200 hours a year on activities related to performance reviews—things like sitting in training sessions, filling out forms and delivering evaluations to employees. When you add up those hours, plus the cost of the performance-management technology itself, CEB estimates that a company of about 10,000 employees spends roughly $35 million a year to conduct reviews. “The process is too heavy, too costly for the outcome,” Nanterme said. “And the outcome is not great.”
6. Performance is an ongoing activity. It’s every day, after any client interaction or business interaction or corporate interaction. It’s much more fluid. People want to know on an ongoing basis, am I doing right? Am I moving in the right direction? Do you think I’m progressing? Nobody’s going to wait for an annual cycle to get that feedback. Now it’s all about instant performance management.
7. The process is too heavy, too costly for the outcome. And the outcome is not great. My philosophy has always been very simple: You need to be relevant to your clients, not the other way around. It’s the same thing with your people. You need to be relevant to them. I’m not going to impose on the millennial generation something that is not the environment in which they want to develop and grow.
What kind of changes in Performance Management System were embraced by Accenture?:
1. It will implement a more fluid system, in which employees receive timely feedback from their managers on an ongoing basis following assignments.
2. At the end of the day, you need to give some evaluation. You need to give a compensation increase. But all this terminology of rankings—forcing rankings along some distribution curve or whatever—we’re done with that. We’ve totally done too much effort for a limited outcome.
3. We’re going to evaluate you in your role, not vis a vis someone else who might work in Washington, who might work in Bangalore. It’s irrelevant. It should be about you. How are you performing now, and do we believe you are prepared to move to another role? We are getting rid of all this comparison with other people.
Additional comments:
Interestingly, though, the decision to roll out an updated approach usually has little to do with reining in the numbers. Kropp said companies aren’t likely to save much time or money by transitioning away from their old ratings systems to a new evaluation process. Where they stand to benefit is, instead, the return on those investments. “The smartest companies are asking, how do we get the best value out of the time and money we are spending?” Kropp said.
Around what time-frame were the changes brought in:
Around the year 2015-2016
Image source:
https://hbr.org/2010/05/mentoring-millennials
https://brighthillgroup.com/game-thrones-work-hr-performance-forced-rankings-heres-instead/
Most of the below text is adapted (directly and indirectly) from the below URLs. So all credit to the authors of the below articles for the upcoming text.
http://www.washingtonpost.com/news/on-leadership/wp/2015/07/21/in-big-move-accenture-will-get-rid-of-annual-performance-reviews-and-rankings/
http://www.washingtonpost.com/news/on-leadership/wp/2015/07/23/accenture-ceo-explains-the-reasons-why-hes-overhauling-performance-reviews/
Motivation behind the Accenture's change:
2. A move backed by current CEO- Pierre Nanterme.
3. Pierre Nanterme's thoughts- "What I learned is that leadership is about letting it go. Trust people. The art of leadership is not to spend your time measuring, evaluating. It’s all about selecting the person. And if you believe you selected the right person, then you give that person the freedom, the authority, the delegation to innovate and to lead with some very simple measure."
"And for the millennium generation, it’s not the way they want to be recognized, the way they want to be measured. If you put this new generation in the box of the performance management we’ve used the last 30 years, you lose them. We’re done with the famous annual performance review, where once a year I’m going to share with you what I think about you. That doesn’t make any sense."
Shortcomings of the traditional system as observed by Accenture:
1. have had enough with the forced rankings, the time-consuming paperwork and the frustration
engendered among managers and employees alike.
2. These companies say their own research, as well as outside studies, ultimately convinced them that all the time, money and effort spent didn't ultimately accomplish their main goal — to drive better performance among employees.
3. “All this terminology of rankings—forcing rankings along some distribution curve or whatever—we’re done with that,” Nanterme said of Accenture's decision. “We’re going to evaluate you in your role, not vis à vis someone else who might work in Washington, who might work in Bangalore. It’s irrelevant. It should be about you.”4. “Employees that do best in performance management systems tend to be the employees that are the most narcissistic and self-promoting,” said Brian Kropp, the HR practice leader for CEB. “Those aren’t necessarily the employees you need to be the best organization going forward.”
5. CEB also found that the average manager spends more than 200 hours a year on activities related to performance reviews—things like sitting in training sessions, filling out forms and delivering evaluations to employees. When you add up those hours, plus the cost of the performance-management technology itself, CEB estimates that a company of about 10,000 employees spends roughly $35 million a year to conduct reviews. “The process is too heavy, too costly for the outcome,” Nanterme said. “And the outcome is not great.”
6. Performance is an ongoing activity. It’s every day, after any client interaction or business interaction or corporate interaction. It’s much more fluid. People want to know on an ongoing basis, am I doing right? Am I moving in the right direction? Do you think I’m progressing? Nobody’s going to wait for an annual cycle to get that feedback. Now it’s all about instant performance management.
7. The process is too heavy, too costly for the outcome. And the outcome is not great. My philosophy has always been very simple: You need to be relevant to your clients, not the other way around. It’s the same thing with your people. You need to be relevant to them. I’m not going to impose on the millennial generation something that is not the environment in which they want to develop and grow.
1. It will implement a more fluid system, in which employees receive timely feedback from their managers on an ongoing basis following assignments.
2. At the end of the day, you need to give some evaluation. You need to give a compensation increase. But all this terminology of rankings—forcing rankings along some distribution curve or whatever—we’re done with that. We’ve totally done too much effort for a limited outcome.
3. We’re going to evaluate you in your role, not vis a vis someone else who might work in Washington, who might work in Bangalore. It’s irrelevant. It should be about you. How are you performing now, and do we believe you are prepared to move to another role? We are getting rid of all this comparison with other people.
Additional comments:
Interestingly, though, the decision to roll out an updated approach usually has little to do with reining in the numbers. Kropp said companies aren’t likely to save much time or money by transitioning away from their old ratings systems to a new evaluation process. Where they stand to benefit is, instead, the return on those investments. “The smartest companies are asking, how do we get the best value out of the time and money we are spending?” Kropp said.
Around what time-frame were the changes brought in:
Around the year 2015-2016
Image source:
https://hbr.org/2010/05/mentoring-millennials
https://brighthillgroup.com/game-thrones-work-hr-performance-forced-rankings-heres-instead/
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