How Performance Management Defines a Leader

Just a few years out of college, I joined a company in (what was for me at the time) a dream role. In this role, I was responsible for creating a learning structure and culture for a company with offices in several countries. By sheer coincidence, my start date was two months prior to the company’s annual employee evaluation cycle so my first big deliverable in my new role was to manage that process to the satisfaction of my boss along with multiple additional stakeholders.
 
I loved this big and audacious opportunity and was motivated by the degree of challenge and complexity it represented. To me, creating an evaluation process flexible enough to accommodate both electronic and paper-based environments (some of the country offices lacks the internet bandwidth to support and office-wide electronic evaluation process) while accounting for several time zones, languages, and cultural practices, was a magnificent puzzle that I was bent on solving.
 
Pretty soon, panic began to infect my excitement. I had no dedicated staff to help manage this huge project and very little guidance, which I desperately needed as a person new to the organization. undaunted, I built as many relationships as quickly as possible to get the lay of the land and soon developed a project plan that I took to my supervisor and other stakeholders for vetting.
 
As I fully immersed myself in implementing the project plan, my supervisor asked me to develop and integrate a learning series for managers consisting of 2-hour training sessions on six functional competencies (delegating, giving feedback, dealing with conflict, negotiating, personal effectiveness, and building effective teams). The logic was that the annual evaluation cycle created a timely opportunity to increase the competencies of managers across the organization. I wanted this effort to be a win because I understood the need and had a lot to prove. I worked 14-hour days until I completed these six trainings in time for a dry run with my supervisor before the evaluation cycle was set to begin.
 
Three days before the launch of the annual evaluation cycle, my supervisor asked me to reduce the six 2-hour trainings down to 1-hour overviews in order to make it easier for more people to attend. While accommodating more people made perfect sense, it was also very clear that my boss had no idea how much time and effort it would take for me to reduce these 2-hour training sessions into 1-hour overviews while still managing all the other critical aspects of the evaluation cycle launch. More importantly, since my boss never asked me about the level of effort it took to complete the first six trainings and never offered additional support, it became clear to me that my supervisor did not see me as a person and a professional. I decided then that I would not continue to work for this person and left the department at first opportunity.
 
I tell this story to illustrate that the way a leader approaches an employee’s performance can define the degree to which the employee is committed to working with this leader. The story also shows what happens when an organization lacks a framework to guide how leaders set expectations with employees around the work. While one could argue that, in my story, how the leader managed my performance is not the only issue or even the most important issue at play, it is the one that, as an organizational development practitioner, has informed how I help leaders think about performance management.
 
What is performance management?
At its core, performance management is an approach that a company uses to plan, monitor, evaluate, and recognize an employee’s contribution to the team, unit, and company. A performance management framework makes visible the competencies, mindsets, and behaviors that the company values. For example, in my story, the company prioritized high and fast output over relationship even though both competencies were organizational core values.

Performance Management Framework
The Performance management framework consists of four distinct stages spanning a company’s entire (fiscal or calendar) year.
 
Stage I: Planning Stage
Manager and employee agree on a performance contract for the employee by setting goals and performance standards.

Stage II: Monitoring Stage
Manager and employee meet regularly to leverage good performance and address poor performance through continuous feedback and professional development.

Stage III: Evaluating Stage
Manager and employee determine the degree to which the employee’s performance is consistent with the established performance contract. The assessment informs possible promotion and/or salary increase for the employee.
 
Stage IV: Reward and Recognition Stage
The manager works with other decision makers to quantify the employee’s contribution to the project, unit, and company in a way that keeps the employee’s motivation, performance, and commitment high.
 
Traditional Performance Management Model
Performance management is so ingrained in organizational norms that most people are not aware of the vernacular despite engaging in some level of the exercise. In my story, the company’s investment in an annual evaluation process suggest more than the other stages of the performance management framework is evidence that the company had the most understanding of Stage III – the evaluation stage.
 
Most companies default to this stage because everyone has a part to play and the roles are clear. Also, the tasks are sequential and timelines are fixed, which means that people can feel good about participating and then moving on until the next time. The evaluation phase relies on rating employees, which makes it easy to standardize how people discuss performance across the organization. As a result, employees as well as leaders like the predictability of Stage III (Evaluating). Yet, when conducted independently of the other stages, Stage III is not robust enough to support the professional development and aspirational needs of employees nor does it allow the company to strategically manage and plan for its talent.
 
Alternative Performance Management Model
More and more, companies are relying on a performance management framework that prioritizes Stage I (Planning) and Stage II (Monitoring). They do so because these combined stages allow managers and employees to engage in meaningful development conversations in incremental periods of time. Adopting this approach requires a company to commit to cultural changes and invest in operational redesigns, which is why adopting this alternative model is often so difficult to achieve and sustain.
 
Ideally, the purpose of performance management is to enable all employees to be wildly successful today and optimally positioned to succeed in the future. The best performance management models are values-based, agile, integrated, and highly individualized. These models work best because they power today’s performance rather than focus on assessing performance realized in the past. I remained with that company for several years and worked with amazing people with whom we accomplished a great deal. Yet, I never forgot the experience I had with my first supervisor – an experience that could have been mitigated, if not avoided entirely, through better performance management.