Many executive executives and professionals in the field of human resources would argue today that performance management processes have failed to respond, let alone exceed, the expectations of most organizations. A number of popular management books have highlighted these concerns by calling for total abandonment of performance management systems.
The “why” for effective performance management limits has been well documented. There are important researches on the different aspects of the performance management process. There have also been numerous proposals, case studies, and guidelines suggesting possible improvements. The area that has received insufficient attention and even direct rejection by some practitioners is the use of the 360 feedback process as an integral part of performance management systems.
In a company, performance management is an extremely important tool that helps top management make decisions. What has happened with performance management all these years, until it has been questioned, has led to a quasi-general dissatisfaction of both the evaluators and the evaluators.
In this context, we can ask whether the use of 360 feedback is the right way to carry out performance assessment. Yet, under the impact of the Y generation, feedback is increasingly important for increasing the level of involvement in the workplace. For them, loyalty lasts about seven months, according to the Global Human Capital Survey. They seem to say that “if I work for seven months or eight months here, I am loyal to the company.”
Millennials work alongside those in the other generations and contribute throughout those 7-8 months, but their definition of loyalty is changed. And if loyalty holds for seven months and the feedback of their performance is given once a year, then it becomes a very important tool for their engagement if given as quickly as possible.
Eighty percent of today’s workforce wants to give performance ratings to their bosses. Assessment for them also includes evaluating their boss. Creativity at work is important, but the most important aspect is feedback. Thus, the real change in the new performance management system is this word: feedback. The way the assessments are made is organized around coaching, feedback and mentoring.
Changing performance management also means changing the organizational culture and philosophy that it supports. That’s why when you ask if they want to change the performance evaluation system, most say they do. However, the statistics show the so-called Hawthorne effect. Under observation, the subjects of research change their behavior and choices precisely because they know they are being observed. When asked privately whether they want this change to start with them, then they completely change their option.
When we talk about a new paradigm of change, we need to consider whether the previous setting of the goal is related to the conversations between the coach and the coachee. If we’re talking about statistics, is it really possible to remove the Bell’s curve? How about breaking the link between compensation, promotion and various salary increases?
The established goal-based performance management systems provided for a goal-setting meeting, a mid-year and a year-end evaluation. In the new paradigm, you cannot just make three purely transactional interactions to evaluate performance. That’s why interaction and conversations should continue through coaching and feedback.
Is there a magical number of interactions? Each company decides as many as it is practical and relevant. But what changes is the recording of professional micro-moments by connecting the manager and the employee to the initiative of the latter. In the new paradigm, it is advisable that the employee has many such meetings as needed, not transactional but transformational ones. That is conversations that help transform the potential of employees in value.
Efforts to change management involve all stakeholders, including employees. It is so much about coaching and mentoring and has so many points of convergence that it is not just a project of HR. Change is an effort of the entire company, and therefore all stakeholders in change management are represented by each member of the organization. The new paradigm in performance management makes managers aware and responsible for the employees whose work they and brings their colleagues closer to the managers who evaluate it.