Performance Management Realities Contd...

In the previous post on Performance Management Realities, I mentioned the bottom of the pyramid and how it becomes nigh impossible to have a productive dialogue between the manager and the job holder.

Chances are this vast population is assigned routine tasks, either on the assembly line as production or quality officers, or as back office support staff and administration officers. Motivating this group can be a challenge and understandably so, their managers keep piling on work, mostly repetitive in nature. The smarter ones find a way to beat the system while the rest merely burn out or remain resigned to status-quo.

The underlying threat here is that when these employees become disengaged employees, they can cause a lot of damage that may not be apparent right away but can definitely hit the very fabric or culture of the organisation, in the long run.

This is where the importance of HR being aware of the business is deeply rooted. Without a fair understanding of operations of the business, HR can never make a case of how important it is for the operations managers to conduct a meaningful appraisal discussion with their reports. Alongside this, the senior management - heads of functions/departments need to play a big role in communicating with this group of employees, perhaps in the absence of their direct manager(s). This skip level appraisal meeting can throw up insights that would get overlooked if left to their immediate manager(s).

Middle management is usually better off with feedback but to ensure that the next level of employees appreciate their role in the larger scheme of things is quite a task.Here again, the intangibles play a huge role and HR would do well to incorporate aspects of HOW these employees go about their jobs and not just HOW MUCH they do. Being a sizable population, they need to be trained in understanding the values of the organisation and what actions demonstrate such values.

Another approach would be to include a section on 'internal customer' feedback. This way, the job holder is taken that extra step closer to understanding the importance of their role in the organisation.

The bottom line therefore points to having multiple formats of the appraisal mechanism. This also means HR needs to get trained on the 'business' and 'operations' and subsequently devise methods that truly provide scope for evaluating performance and its impact, regardless of the nature of the job. Emphasis needs to be laid on the development opportunites and subsequent growth within the organisation. Only by involving the senior management in periodic reviews of this band of employees can organisations live up to claims such as 'people are our greatest asset', 'we believe in meritocracy' and the like.

Performance Management Realities...

In large organisations, especially manufacturing and service industries, it is possible that the pyramid is quite tall. Often times, in such scenarios, there is a sizable number of employees at the lower end of the food chain. This population is admittedly not equipped with the aptitude to be able to appreciate the concept of self appraisal, let alone 360 and what have you. I don't want to even get started on the unionised workforce...

So this band of employees are typically in the age group 30-45 and have a graduation degree to flaunt but nothing else to show for it, they would typically be handling routine jobs like being chemists, production officers, or handling administrative jobs. They would be mighty pleased to get an annual salary increase that's slightly above the annual inflation rate in the country. And this perhaps is also the reason why they seem to be the neglected lot when it comes to appraisal discussions and feedback for development.

It is a known fact that in the Indian scenario, the annual increments are often done in retrospect, the letters announcing the increased salaries and re-designations are usually ready in May, handed out to employees in June with the safest footnote that HR has - "WITH EFFECT FROM" 1st April!

During several roadshow sessions in reaching out to the entire population of employees for awareness sessions on what they can expect from the company's appraisal process, we learnt a few shocking things. Some employees would notice that in one particular month -May or June at the earliest, their salary accounts are credited with a higher than usual amount. Voila! They realise then that some form of appraisal has occurred and therefore their salaries are different now. They then wait patiently for the letter that lists out what their salary structure looks like.

And yet, Performance Management is one of the biggest activities that the HR department undertakes in the months January through whenever they warp it up... Appraisal forms are designed, distributed, presentations on SMART goals circulated, ratings obtained, force fit into Bell-curves done and excel sheets pored over to establish the impact of ratings on salary increases and the like.

Organisations that intend to take their appraisal process seriously need to understand that it HAS to be a continuous process, something that is done right through the year, periodic reviews (quarterly if not monthly) are done and feedback shared with the employee and the heads of the respective departments. Any review that doesnt involve a formal interaction between a manager and the job holder, leading to a sign off is pointless and can seriously dent the performance culture of the organisation.

The trouble really begins at the top. Though there are very clear agenda and strategy that the CEO and his direct reports have, they seldom percolate down to the operational levels in a structured manner. Without this one critical step, HR would always end up cutting a sorry figure when it comes to administering the process of goal setting for teams and subsequently individuals. Often there is a disconnect between the top management and the HR operations team when it comes to the roll out of the appraisal process. And HR is to blame squarely for not ensuring that the organisation goals are formally shared to be broken down into department goals and so on.

Agreed that often due to changes in the business environment, the organisation goals can change course but then this is exactly what gets addressed when we have periodic reviews.

The other critical problem with appraisals is the fact that there is a lot of focus on WHAT is being accomplished and in the process HOW it is being done is overlooked. This is where the culture and value systems of the organisation comes in. It is the primary responsibility of HR to identify what actions and attitude are in line with the organisation's value system. It is the subsequent responsiblity of the heads of various functions/departments to constantly encourage positive behaviour among their team members and always follow the fact that 'the ends never, ever justify the means'.

Addressing this becomes easier when there is a mature HR team that looks at the importance of having a training agenda that enables employees to focus not just on the skills required for success on the job but also to mature as individuals and become role models when it comes to living the values of the organisation. While most appraisal forms have a space for 'individual development needs', rarely does this get translated into action and as a result HR again stands to lose face and the appraisal process gets relegated into a form filling exercise.

Give me the bad news...

An executive on a tour, visiting operations and sites of the company's business may feel good at the end of a long day of presentations by the local management team(s), figuring that everything is going smooth and that things are under control, in safe hands and other such cliches.

Armed with this first hand experience, HQ may in turn feel reasonably secure, look at top lines and bottom lines - however in the case of an accident or a disaster, remedial measures would be unleashed. Chances are, it is only in the event of a disaster that remedial measures are thought of.

Given the fear of the messenger being shot, or having fewer friends, etc., it is only obvious that communication systems, especially the bottom-up comm is generally packaged to give the sense of comfort - all is well!

The top-down communication also tends to seek only the good news, if not explicitly but by giving out signs to that effect, and the messengers therefore steer clear till 'the bad news' culminates into a disaster or a failure that impacts the long term prospects.

The fact remains that if bad news is brought to the notice of the leadership/executives of the company, a lot of things can be fixed before them getting downright messy. This approach would invariably instill a sense of insecurity around, but really its a small price to pay for the long term security of the business.

Good news doesn't require any decision making but bad news, if made available asap, can help get a fix on things. Certain organisations formally encourage supervisors and managers alike to find out if someone or some operation is headed towards 'the bad news'... well that's good news, provided organisations take the cue and sensitise their workforce and managers alike that bad news, detected early can actually save the day.

The trouble with Benchmarking

Learning from others' mistakes or drawing inspiration from the success of another company, is all very good. and this leads to benchmarking, which is rational, considering the ultimate performance, good or bad, is figured in comparison to others.

The real trouble with benchmarking is what Pfeffer and Sutton* call 'casual' benchmarking -

a tendency to get influenced by a certain set of 'best practices' and applying them at ones own organisation - only, never to get any real success.

The Southwest - United Airlines case is one particularly relevant one. Southwest practices were copied by United Airlines, casual dressing for front office and security positions, scrapping of meals onboard, and reduced time spent by planes on the ground. Yet Southwest had much greater success than United Airlines which ultimately got grounded.

Likewise, the Toyota impact on the automotive industry was nothing short of phenomenal. Soon, the American motor companies began implementing the japanese management techniques and initiatives like JIT inventory management, Statistical process control, etc. However, they couldn't quite replicate the success of Toyota.

The bottom line really is to consider the philosophy behind those seemingly great practices and not just be myopic and limit onself to the immediate benefits thereof. Southwest Airlines did not terminate a single employee during their restructuring and therefore the management initiatives were successful. Toyota still remains ahead of the US automakers in quality/design features as also on productivity. Toyota's success was not based just on its techniques, but on the mindset of total quality management and continuous improvement. Their relationship with their workers enabled it to tap into their deep knowledge.

As such, Benchmarking would yield relevant insights only if proper planning and specifics of the aspects to be benchmarked are deliberated upon by the senior management. Some aspects are better considered within the industry - salaries and hiring practices at entry level positions, incentive schemes for instance. However certain other aspects such as safety practices, employee orientation, operations related practices etc can be benchmarked across industries. These and such other perspectives need to be addressed right at the beginning and then move towards the actual exercise.

* Pfeffer and Sutton are faculty members at Stanford and have co-authored "The Knowing-Doing Gap" and "Hard Facts, Dangerous Half Truths and Total Nonsense".

The Trouble with Policies

Some policy documents, if not all, were at one point of time confidential!

Can you beat that? Actually, that calls for attention to another issue - what came first - the policy or the management whim?

Well, my take is - its the management whim that came first.

The policy document is but a manifestation of what is convenient to the management of the company.

No, not the CEO - every CEO wishes his workplace to be the ideal one - where every employee who leavesthe office at the end of the day comes back the next morning, and eagerly at that.

How come then? Well, for one, most of the policies are about benefits or administration. While benefits proportionately increase with hierarchy, administration is but a leash that the seniors require to keep things under control.

Incidentally, 'management' qualifies under both these categories as 'beneficiaries' or 'interested parties'.

Policies tend to be uniform at a certain level and below, where as along with the senior level policies come clauses and sub clauses.

A classical example would be the Travel Policy. Employees at entry level through to executive level - travel be AC-II Tier - board and lodge @ Rs. 2000/- per day; but as you go higher, there are stars that get added to the 'lodge' and when you run out of stars, comes the magical word - Actuals!

Mr. Ricardo Semler really turned things on its head and came out with policies that are one liners, a paragraph at most. There are also other companies that have concise statements - "Travel Sensibly" is actually the entire travel policy in a software company.

The fewer the words in a policy document, the more the employees are going to get the impression that they are considered to be responsible adults, capable of being realistic and ethical too.

Another trick with making effective policies is to trash the document and simply build short phrased policies that centre around what is already working - this simple but 'eccentric' method may actually go a long way in winning the confidence of your employees.

The Trouble with Job Descriptions

Do we need Job Descriptions?

I asked this question to myself as I made notes for this blog and sent a message to a friend from college, another architect turned management graduate...

"We, individually do not need Job Descriptions, just teams that know and doing their bit towards achieving some org goals"

Interesting point that, and to boot he said, "Why should I be called a Manager - Planning, we might as well be called Zombies and we would still go about delivering what we already are..."

Individual JDs or team JDs, the classical format or a more customised version, if JDs are to be workable, the credibility of the whole exercise is critical.

The promise of a well thought out JD/Competency exercise can be awe inspiring and yet that so often flatters to deceive - implementation is fraught with challenges, nay its a mine field.

1. Often consultants are lined up and they (rightly so), take the organisation a few steps back namely to 'Job Analysis' and then lead up to 'Person Specification' and then to the real exercise of JDs. Tie that to the competency bit, architecture and all and we have a good 6-8 month project.

2. By the time the exercise takes shape, few if not several critical roles may have undergone a change and then management of this resulting data becomes critical to the credibility of the whole idea/project.

3. Buy-in of the vast majoriy of the employee population who would invariably have little or no clear understanding of the latest Corporate HR - OD intervention. 'IF HR is asking questions about our job, how many times we are expected to step out of office, how often we have to attend meetings, work in teams, etc., THEN they must be upto something...

4. No one external consultant can have a thorough enough understanding of the different functions in any organisation - the complexities are just too many to even pretend such a superhuman consultant exists. Again a threat to the credibility of the project.

5. A JD may easily be relegated to the safety of a folder as a secure document only to be accessed during the annual reviews.

A mechanism that ensures that everyone needs to look at their Job Description on a weekly/periodic basis can go a long way in the Credibility Enhancement of the project.

Also to ensure this one time exercise bears the reward it promises, the above mines could well be anticipated and the internal HR function can, by virtue of its own competence have the 'Job Analysis' and 'Competency Framework' chalked out before bringing the specialists in.

The specialists - us, mere mortals of consultants, can do their articulate best in documenting what the employees of their client are doing and therefore the internal HR team has to ensure that framework is in place. Another essential towards the Credibility Enhancement of the whole exercise.

The Appointment Letter Yardstick

If you are in HR then I urge you to consider this for a moment - How do you appraise the HR function?

Oh! there are many ways -

If training then look at the training mandays, if you are a level 3,4,5 company then you're already looking at the training feedback, ROI etc. Some cooler organisations are also looking at Engagement scores!

If Comp & Ben then let's look at how many realisitc comparisions have been done and implemented.

If its the IR function then look at the overtime hours, contract labour reduction metrics and over all unrest climate.

Ah, there's the word "metrics"... you and I would be looking at this word for the hundredth time and would have used it in our conversations and presentations 101 times. The problem with metrics is akin to the statistics and drunk wala story - using the lampost more for support than for illumination.

So what do we have here? Lets just look at the harmless Appointment Letter.

If you are in HR then you would have invariably faced situations where there is a great candidate (read: referred by the CEO) where in the guy was so good, you get him on board practically overnight, have the joining formalities done on priority and have the recruitment team put together a classy induction schedule.

Even in situations such as this, the Appointment Letter is delayed and if the HR head is lucky, he just gets a call from the CEO after a week saying get it done, mostly HR heads are not lucky though!

Such are the pressures of the HR function that the eternal search and replacement of candidates, the welfare of employees and the general cribbing population just descends on every day of the week, each with their share of the remains of their monday blues. Ever wonder why the HR team wants to work for "at least" half day on the weekend? Thats why!

But the CEO's call notwithstanding, regardless of the HR head's reprimands, the HR function continues to go from one pressure situation to another and soon everyone including the CEO "understands".

But what really can be the trouble with the appointment letter. Just look around and you will find that in most cases the appointment letter is handed over to the new employee at least 3 days if not 5, a week perhaps even longer. Most employees who join the company are happy to receive the offer letter and are almost surprised to receive the appointment letter. Some companies are already issuing 'offer cum appointment' letters and some are issuing them bang on day one, at the end of a busy day of form filling and thats the way it should be.

My hypothesis is that the turnaround time of an employee joining and his appointment letter being handed over to him can be the single most important indicator of how efficiently the HR team is functioning. The appointment letter is the formal contract and is also the least read document by all, employees and the HR folks alike, "kya karen, its the format being used"... thats how they all chirp...

IF the HR team is able to mobilise its resources to ensure that the appointment letter is ready along with the joining kit to be handed over to the new joinee, THEN one can say the HR function is functioning properly. Every HR professional should look for the content that goes into this most important document... Does the fine print turn off the reader? Does the CTC break up as broken down in the contract end up breaking the reader's heart? And the bloke realises its too late to fight over some numbers, that too with HR... Or is the HR function brave enough to talk through the content of the letter and leave no room for shocks, this is possible only perhaps on day one and that is when the Appointment letter should be issued.

Somehow, I have not come across instances where this is considered in workplaces and have been long thinking of it as a potential winner. So, there goes...