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The Performance Management Piñata

Source | LinkedIn : By Enrique Rubio

In 2015, General Electric moved away from the traditional performance management’s annual appraisals to a more dynamic and flexible style. This was a big deal, considering that former GE’s CEO Jack Welch was the very father of that traditional approach to performance management. GE joined a club that Accenture and Deloitte, the biggest consulting companies in the world, had already been enjoying.

Last week IBM joined that very special group and got rid of the annual performance review. I can’t generalize, but it seems to be true that everywhere the traditional approach to performance management is becoming a real piñata, getting punched and hit from every possible angle. Some companies are moving faster, some slower, yet they are talking about it, and there is a lot of noise everywhere. What is going on? What are the implications of these changes? And what can be done?

GE, Accenture, Deloitte, Adobe, Microsoft and many other companies realized that the workforce is changing really fast, including its behaviors, needs, motivations and interests. People are not inspired, engaged and rewarded anymore by the premises claimed by the traditional approach to performance management. Getting a monetary reward based on a rating given on a once-a-year appraisal is simply not working. It is necessary a new understanding of the ways people are creating, innovating, collaborating and communicating in order to define a better system that truly drives high organizational performance.

I have mentioned in previous posts that understanding the new dynamics in the workplace must begin with coaching people to find their voice. It essential to help them explore their potential by providing the opportunities to thrive and succeed. A once-a-year appraisal is actually the opposite and offers the wrong kind of incentives.

A once a year written appraisal and “feedback” conversation between people and leaders have two perverse premises. First, that the information of what was done, learned, created, scaled, or innovated can be accurately communicated in a document. In reality, not only is it impossible to capture with precision all that has been done in one year at only one time. But, even worse, the learning process from successes or failures, the need for pivoting when things don’t go as planned, the experience and stories that emerge from true collaboration, and the processes behind the creations and innovations, are lost.

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