Performance Management Manifesto

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Look out. Email messages are rolling in about year-end reviews, merit increases, and general dissatisfaction with performance management processes. We are even talking about performance management at my own company.

I once tried to write a ‘performance management manifesto‘ while working at Pfizer. It was awful. I sounded like Andy Rooney. And although there are 100 different software solutions to measure and analyze performance, there are very few ways to assess performance (in the context of both business and human nature) that are valid, reliable, and scalable.

The whole thing can be a mess. Companies over-think it. HR departments over-manage it. Employees over-litigate when communication is poor.

So here are some of my thoughts that I included in my old manifesto. As you read through this, you can see why I never published it.

  1. Employees will never write an honest self-appraisal.
  2. You don’t need a formal program to talk to someone about expectations, give feedback, and set goals.
  3. A performance management program that ranks employees but isn’t tied into an open compensation program — with a published algorithm and transparent results — feels like a waste of time to employees.
  4. Bonus calculations never make sense because most people are bad at math.
  5. Gimmicky bonus plans and performance reviews that aren’t called performance reviews are just that — gimmicky.
  6. There is no such thing as a cost of living increase.
  7. You get paid for being average and doing your work.
  8. You get a raise when you add value to the company.
  9. You get promoted when you can justify a new role and a new title.
  10. You get fired when you suck or there’s no money in the budget to fund your job.

And just because you measure for performance doesn’t mean you have budget to pay for performance.

Now you can see why I walked away from HR and work with HR technology vendors. Companies will spend money on performance management software — especially if you throw in the word ‘analytics’ and promise to integrate performance management with every other aspect of the HR experience. In fact, companies will try to spend on technology and infrastructure before they will invest in the employees themselves.

In short, there’s gold in them thar hills. That’s a win for companies like SAP and Salesforce and Oracle and Taleo and Workday and CornerstoneOnDemand and Kenexa and Ultimate Software and saba and NorthgateArinso and Lumesse and SilkRoad and iCIMS and Halogen; however, some of these solutions have serious shortcomings.

And no software package can offer a win for employees who are trying to figure out what’s expected of them and managers who are trying to manage ’em.

That’s why I am still toying with this manifesto.

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