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VANCOUVER, British Columbia, Canada—As some companies continue to ditch performance reviews, one HR executive says leaders should focus on their employees' potential for future achievements rather than critique their past efforts.
As SHRM Online reported recently, at least 12 percent of Fortune 1000 companies have abandoned performance rankings or eliminated performance appraisals.
"This is a seismic shift in the way we work," said speaker Greg Pryor at the recent HR Conference and Tradeshow 2017, sponsored by the Chartered Professionals in Human Resources of British Columbia & Yukon.
"Organizations are rethinking their approach to people practices and considering how technology can accelerate their journeys and enable their people."
Pryor is vice president of leadership and organizational effectiveness at software vendor Workday, based in Pleasanton, Calif. He urged companies to reimagine performance management. "Ratings and evaluations don't drive performance one way or another. It's time to get rid of [them]."
According to a 2017 Gallup study, Pryor said, only 2 out of 10 employees say managers manage their performance in a way that motivates them to do outstanding work—meaning the traditional performance management system is broken.
A Shift Happened
In 2009, Pryor was vice president of talent for network services provider Juniper Networks in Herndon, Va. In March of that year, he met with hundreds of employees in Bangalore, India, where one employee's opinion shifted Pryor's view about performance management entirely.
"'[Juniper Networks'] performance management system is a violation of our values" he said the engineer stated.
At that time, Juniper followed best practices as conceived by former General Electric CEO Jack Welch in the mid-1980s. Welch focused on the importance of effective performance appraisals and leadership development in many of his BusinessWeek columns and in books. He also espoused forced ranking, in which a specific percentage of workers were ranked from top to bottom, which, in turn, affected their promotions and bonuses. To the Indian worker, this didn't align with how Juniper Networks said it would treat its employees.
"In retrospect, what we knew was [that] what worked for GE in 1984 would not work for Juniper Networks in 2009," Pryor said.
The move from performance management to performance enablement requires a change in corporate culture: Managers need to think of themselves as coaches, not bosses, and supervisors need to give feedback more than once a year. Employees are ready for the change.
"Millennials are in favor of [having the option] to build new skills and prepare for the next great uncertainty," he added.
Shift your point of view from the organization's perspective to the employee's perspective. "This is a once-in-a-generation opportunity," Pryor continued. "We're moving away from career paths to career experiences." [SHRM members-only platform: SHRM Connect]
Factors for Employee Success
Managers must give employees the opportunity to contribute to the organization, empower their career aspirations, and help them grow their capabilities and deepen their connections.
HR, he said, can use technology to help employees track their contributions, measure their skills, plot out career moves and make connections, and help managers judge whether employee bonuses and pay raises are properly based on performance.
He said "a feedback-rich culture [can] enable performance and success." One-on-one conversations, career check-ins and team meetings can also drive the enablement process forward.
Catherine Skrzypinski, a freelance writer in Vancouver, covered the Chartered Professionals in Human Resources of British Columbia and Yukon's HR Conference and Tradeshow for SHRM Online.
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