If you are to gain approval for investment in a new IT-supported process, something which, in your opinion as HR manager, is beneficial, then it is essential that other decision makers also understand its purpose. It is only when you really feel the pain and a burning need that you really seek to do something. It is the same with members of a management team when they are to make a decision about your proposal. You will obtain support if there is agreement on which business-related issues exist, and by substantiating how your proposal really will result in a solution.
Below is a sample of typical issues related to the performance management process, and the possible reasons for these. Many of these are probably relevant to your organisation and can be used to demonstrate and increase the value of your proposal.
1. Typical issues
1.1 Related to productivity
Low motivation/poor commitment – a lack of job satisfaction results in a reduction in enthusiasm, and the motivation to give that little bit extra is absent.
People working with the ‘wrong’ tasks at work – even though you do the best you can and work hard, it is critical that you focus on what produces the best results for the organisation as a whole.
Skills shrinkage – development needs are not maintained adequately over time.
Losing talented employees – which involves continuous investments of time and money in employing replacements.
Absence due to sickness – the time employees are absent as a result of low job satisfaction is an expense that does not deliver any value to the business.
Poor reputation in the employment market – makes it difficult and expensive to hire new staff.
Improper use of training funds – the training budget is exhausted without initiatives being targeted to needs.
Improper bonus payments – tend to occur if the criteria are vague and there is disagreement about whether the employee is actually eligible.
Time wasting – manual, paper-based procedures require effort that can be better utilised elsewhere.
2.1 Poor focus on objectives, poor quality of targets, and poor performance culture
The specific clarification of objectives in the dialogue between manager and employee is lacking. Any goals that may exist are vague, qualitative, and difficult to report progress on and evaluate. Therefore, it is uncertain whether individual employees are working with the ‘correct’ objectives and tasks. It is also impossible for the employee to know if he/she is succeeding or not. Motivation and enthusiasm can disappear. And how should the manager perform evaluations which in turn form the basis for other processes, such as salaries/bonuses and talent programmes? Bias based on appearance is probably more decisive than performance.
2.2 Unclear correlation between the objectives of the employee and the objectives of the business
It may be that the objectives that individuals are working towards are, when dealt with individually, clear and unambiguous. The problem is that any correlation to the objectives of the manager is absent or unclear. Therefore, uncertainty arises about whether the objectives that the individual is working towards are in the interests of everyone, and whether daily priorities are in fact correct. Each employee is following their own course. The individual does not see the correlation between their own objectives/role, and the goals of the business.
2.3 Performance appraisals are perceived to have little value
Performance appraisals are most likely something that HR is concerned with, while managers, and to some extent employees, fail to see the point. Appraisals involve some discussion of how the employee is getting on in their job and of what can be done to make things better, and agreement on a couple of courses and reports that are duly completed. What is deemed to be important, namely the determining and monitoring of targets, is also addressed, but usually at departmental meetings and through informal contact between managers and staff. All in all, this is a very time-consuming way of conducting operations management and a performance appraisal which is hardly constructive and is consequently considered a ritual.
It is highly probable that issues described in sections 2.1 and 2.2 are also present.
2.4 Uncoordinated/lack of skills development
If the employees’ development needs are not adequately identified, then there will also be no guarantee as to if and when measures are initiated. The measures implemented are often done so on impulse and are not based on the role’s current or future skills requirements. This means that individual measures can often be characterised more by considerations pertaining to welfare than needs-driven skills creation.
2.5 Inadequate daily follow-up
Managers, who may themselves be in an operational role, have little contact with their employees. Employees on the other hand, do the best they can, but feel neither visible nor appreciated. In practice, managers communicate that the focus on targets and deadlines is unimportant. Therefore, it is uncertain whether individual employees are working with the ‘right’ objectives and tasks. It is also impossible for the employee to know if he/she is succeeding or not. Motivation and enthusiasm can disappear.
2.6 Random and subjective evaluations
Processes are introduced here that are intended to safeguard the development of employees (in the case of salaries and careers, for example). The problem is that there is a lack of clearly defined evaluation criteria (performance, conduct, etc.). But managers still have to carry out their evaluations and make decisions. Employees will perceive such a regime to be arbitrary and subjective, they will lose confidence and think that ‘the system is unfair’. Motivation and enthusiasm can evaporate.
2.7 Poor correlation between objectives, conduct, skills requirements and personal development objectives
Here the attitude exists that personal development = skills development. A broader assessment, in which one also draws on conduct and performance as the foundation for personal development measures, does not occur.
2.8 Low performance appraisal completion rate
This may be because performance appraisals are perceived as rituals, and there are no consequences for managers who neglect leave them. Many employees will feel that there is no important arena for contact and dialogue with their manager. The basis for evaluation, management by objectives and competency management can disappear.
2.9 A time-consuming and inefficient process
The current routine for performance appraisals is paper-based and lacks process support. In particular, managers and HR become frustrated due to the time required for preparation, implementation and follow-up. HR cannot see how the appraisal process is developing and spends time ‘nagging’ the organisation.
2.10 Difficultly in capturing the organisation’s development needs
In many organisations, managers have the task of sending a copy of the form to HR once the performance appraisal has taken place, or if applicable producing an extract containing the agreed development measures. The purpose is to provide HR with the data to implement objective-targeted development measures for the organisation.
The problem is that managers often fail to send the requested data. And if they do so, HR has limited resources to systematically go through the material, and therefore the proposed measures are delivered late or never at all. Employees feel that the needs identified in their performance appraisal are not met. Motivation and enthusiasm can go out the window.