Performance Management: The Five Mistakes Companies Make

Performance Management: The Five Mistakes Companies Make

shutterstock_360101591A few weeks ago, I was in the waiting room of a hospital as my mom recovered from her 4th back surgery.  She was in the post-op room for a few hours as we waited for her private room to be cleaned.  I was angry.  It had been two hours since my mom’s surgery ended and her room was still not ready.  I checked with the nursing station to see what the issue was.  The head nurse informed me it was the busiest they had been in a long time and every bed was occupied.  The room she was waiting for had just been vacated and needed to be properly cleaned.  Two hours later, we were still waiting.  Now I was furious.  I marched over to the room.  The cleaning person was still there and must have known I was upset from the look on my face.  The man assured me he would be finished soon.  He explained that it was an extremely busy time, but it was important that this room is clean for the patient.  You see, he said, after surgery, it’s very important that the room is properly cleaned so the patient doesn’t get an infection.  Clean rooms are important to a patient’s recovery.  And patients are important to the hospital.

Do you know how you, as an employee, contribute to your company’s results?  Are you familiar with the strategic goals of your company and how you help achieve them?  This man clearly knew his role in the company’s overall success.  I wish the same could be said about every employee in every company.

Over the past 17 years, I have participated in many different versions of performance management. As an employee, I have been rated and ranked against people I have never met nor seen.  I’ve been held accountable to up to 18 competencies.  I’ve been assigned SMART goals that were not very smart.  At times, I’ve had ZERO goals.   What about you?  What has your experience been?  As an HR practitioner, I’ve designed and managed formal review processes.  I’ve evaluated different systems for managing performance reviews and feedback.  I’ve created from scratch and then overhauled TWICE, complicated competency models.  This history lesson has a point…I have been fortunate enough to try lots of variations of performance management and see the fruits (some ripe, some rotten) of my labor.  Some things worked well, some didn’t.  And where I believe each company is unique and would benefit from customized solutions for their culture and people, I do believe that there are 5 mistakes ALL companies could fall victim to if they are not aware of them.  These 5 mistakes will derail your performance management program and its purpose – to drive company results.

Mistake #1. Assuming a system is going to fix everything. 

Systems can solve lots of things.  They automate processes and increase efficiencies.  They create accountability and visibility with reminders and dashboards.  They roll up large sums of data so it can be easily sliced and diced into reports that identify common themes across the organization so we can make informed decisions. I love systems and all the benefits a good one brings.  However, we sometimes forget that in the end, it’s still just a system that we humans use.  And if we put junk into the system, we will get junk out.  The right data is critical to your performance management system’s ability to influence company results.  Your talent needs to be clear on the data – WHAT are they giving feedback and coaching on?  What success metrics and behaviors really drive the company’s success?  These should be the focus of performance discussions.  These need to be clearly defined in your system to ensure the right conversations are taking place, which leads us to Mistake #2.  Is it clear to your people what they should be talking about?

Mistake 2.  Lack of clarity on what your people need to do to achieve company results.

If you have ever trained for a marathon or race, then you understand the importance of knowing where the finish line is.  Knowing where the finish line tells you when you are done.  And knowing where you are along the way throughout the race and how far you have left to go, tells you if you need to sprint or keep your pace steady to make your desired time. Is it clear to your people what each of them needs to do and when in order for your company to cross the finish line?  Do they know throughout the year when they have to sprint?  Notice the difference in these two goals.

  1. As part of the company’s customer retention goal, I’m responsible for providing outstanding service to my clients.
  2. As part of the company’s customer retention goal, I’m responsible for achieving an average client Net Promoter Score (NPS) of “8” or higher.

If we look at the first one, the responsibility is clear.  I am responsible for providing outstanding service.  But what determines if I am successful or not?  The employee’s perception of service quality?  Their client’s?  What qualifies as success?  Repeat business or a positive review?  It’s not clear.  We are left guessing.  The second statement is very clear.  No guess work needed.  Success is an average client NPS of “8” or higher.  Which one do you think helps your employees focus and achieve the desired results? #2!  Whether you call them Key Performance Indicators, Rocks, OKRs, or SMART goals, it doesn’t matter.  What matters is that every person should know how to measure their success and how it impacts the company’s success.  By keeping an average NPS of 8 or higher, I am driving customer retention for the company.  I know how my success will be measured.  I call these measurable results “THE WHAT”.   Just as important as “THE WHAT”, is “THE HOW”, which brings me to Mistake #3.

Mistake #3.  SUPER complicated competency models.

As an HR practitioner, I have created some elaborate competency models.  I mean, they were beautiful.  They took me several months to build.  Now, I believe competencies are critical in getting the results.  But we need to make them easy for team members to remember and apply.  You’ve heard the expression, “if everything is important, nothing is important”, right?  That is the downfall of many competency models today.  We list EVERYTHING that individuals could possibly need when really they only need to focus on a few critical behaviors to drive success.  Is your competency model TOO complicated?  Is it driving company success or derailing it?  Here is a test.  Select 10 people from your organization (outside of HR!) and ask them to list each competency, describe what it looks like in action, and why it matters to company results.  Make sure you include leadership team members in your test group!  If they can answer your questions, your model isn’t complicated.  It’s simple enough and should be effective (assuming you have identified the RIGHT behaviors, but that is a different blog).  But if they can’t, then it’s too complicated.  The primary purpose is to give people direction and clearly identify what behaviors are important, and then to give them feedback and coaching on them so they can get the best results, which brings me to Mistake #4.

Mistake #4.  Undervaluing the power behind frequent feedback and coaching.

How long can you allow the wrong behaviors to continue before they negatively impact your results? Regular feedback and coaching ensure that we are reinforcing the right behaviors frequently so we keep getting the right results and stopping the wrong behaviors quickly so we can course correct, get back on track and get results.  The better your team is on giving and receiving feedback and coaching, the easier the process becomes.  What does regular feedback and coaching look like?   I like real-time feedback, when appropriate, along with weekly and monthly feedback discussions.  I keep the weekly conversations simple with four questions– How are you feeling, what did you do well this week, what can you do better next week, and what obstacles can I help you with?  I use the monthly feedback discussions to review progress on goals, provide coaching, remove obstacles, and address meatier performance topics.  With more frequent discussions occurring weekly and monthly, the need for formal performance reviews as a way to influence performance decreases.  And because we are talking about progress on our goals in our monthly discussions and hopefully regularly tracking and monitoring results at the department and company levels, then performance reviews become more about recognizing success and rewarding team members.  The time and effort to complete these formal reviews lessen because we have been talking about them all year long, which brings me to the 5th mistake.

Mistake #5.  Seeing performance management as something you do once or twice a year through performance reviews.

I’m not big on football, but I watched the Super Bowl.  And what I saw validated what I had read about Tom Brady a few weeks ago – the man is SERIOUS about his performance.  Even when its off season he is training and he is training HARD from his workout to his diet.  The man is never really OFF duty….  The same should be said about your performance management program.  Notice I said PROGRAM, not process.  Performance Management is a program that includes processes and systems that work together to drive the execution of your company strategy.  It does this by setting clear expectations for results, tracking and monitoring these results, and influencing performance that drives these results.   This program works ALL YEAR LONG, not once or twice a year for a few weeks.  The program is closely linked to your strategic plan.  The goals you set in your strategic plan are inputs into your performance management program.  As you monitor the progress of your strategic goals you may need to course correct at the department and at times individual levels.  We see this course correction communicated in our performance discussions that we are having weekly and monthly.  Your performance management program creates alignment between your strategic company objectives and the actual execution of these objectives by your people.

So, how does your performance management program measure up?

Do you see any of the above mistakes taking place in your company?  What does your company do really well?  What could they improve?  For a free assessment of your performance management program, contact .  For more information on creating a strong performance management program, check out our past blog on the 5 Building Blocks of Performance Management.