Thursday, September 3, 2015

Will the Performance Management (as we know it) cease to exist in future?

In the traditional realms, the topic of innovation is often attributed largely to the product specific deliverable.

I have long believed that in-order for organizations (especially the kind of ones that i have experienced) to innovate and scale, it is imperative for supporting functions to embrace the principles that lead to innovation. By supporting functions i mean- HR, IT, Finance, Operations etc. As an example, we may have the best product innovation strategy but if the facilities is not supporting the engineers create a good physical environment, then chances of breaking new grounds may be quite less. In the similar way, one of the core supporting groups in the organizations is that of Human Resources. In my experience, i have not seen many engineers having positive perception about HR function and always seem to undermine the actual importance this group has on the eventual outcomes of the organization. Like some functions, the importance of HR is generally appreciated when this function is not there rather than when it’s often there. HR department can often be equated with Software testing department in the premise that both often seem to be thankless jobs and the value of one is known more by the absence of the group rather than by their presence, which is often taken for granted.

If i don't look back far too back, there has been some sort of silent (not much talked-about) innovation happening in the HR function as well. A lot of the age old practices are being re-thought and one such practice has been that of performance management.
Historically, performance management (and the way it’s traditionally done) isn't one of the most appreciated practices in the organizations. Having experienced reasonable number of employee surveys, this is one area that is often found wanting in the organizations. I won't discuss this reasons about it in this post as this will be the subject of the upcoming posts. In the next few posts, i will try and highlight some of the companies that have brought in some refreshing thinking around handling performance management and have shunned the old, traditional way of handling performance management and adopted something new. I will highlight a few companies and post that will try and provide some consolidated perspective around it. Alright, just await the next few posts.

Just as a trivia around performance management, consider the following snippet adapted from here-
Performance reviews have been a part of institutional life since formative Harvard Business School studies of the 1930s. Professor Elton Mayo found that "happiness and productivity were directly related to the social structure of the workplace," Businessweek reports. "Suddenly it wasn't enough to just hire someone to do a job; bosses had to manage and mentor people, too. They did that, usually, with formal meetings."
Then, in 1950, the performance review was enshrined in law. The Performance Rating Act of 1950 mandated the annual review of federal workers. Additional laws tethered bonuses and salaries to the grades given in those evaluative meetings, setting a nationwide precedent of annual performance reviews.

In the upcoming sections, I will be analyzing some of the companies that have gone ahead and embraced change in their performance management philosophy with the focus on the following points, which was the core i wanted to understand-
1. Motivation behind the change
2. Shortcomings with the traditional system
3. What kind of changes were embraced ?
4. Any other related comments

See you soon!

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