6 businesses that are taking their PM Systems to the next level
These days, performance management is becoming increasingly more commonplace than it used to be, each business adding its own take on how it should go about designing the perfect performance management system that suits their specific needs.
Companies around the world are constantly redefining how they perceive the concepts of performance, management, efficiency and efficacy. The following six companies are ditching annual reviews altogether, replacing them with novel review methods:
When it comes to GE, the rank-and-yank was replaced with managers having a review meeting with their employees, in order to see how they are faring.
The difference between the olden days and today’s method is that regular annual reviews no longer seek to punish, but to train – during each individual review, any under-performing employee will be enrolled in a specialized training course, in order to meet his goals.
Currently, General Electric has also developed an app through which their managers can give their employees regular, daily performance feedback. Both methods have slingshot them ahead of their competitors, as they are ranked the 8th most valuable company in the Fortune 500 list.
Cargill Inc. had difficulties when it came to encouraging and motivating their workers. As such, they created a strategy called the “Everyday Performance Management” system, which is a way of giving their employees daily feedback through on-the-spot conversations.
The key to this change is to make sure that managers give constructive and positive feedback in order to keep workers on the right track, instead of simply handing out negative feedback and criticism after a task has went downhill.
Eli Lilly is one of the most well-known pharmaceutical companies in the world, boasting some very progressive HR practices and innovative performance management. They focus on trust, which encourages employees to share their ideas and opinions with their managers.
By doing so, it helps strengthen the relationship and teamwork between employees and their respective managers.
This company’s focus on performance management is quite straightforward: regular, daily feedback. Adobe pursues a system of constant feedback and check-in, which resulted in a 30% reduced voluntary employee turnover.
What’s more interesting is that their “involuntary departures” have also increased by 50%, showing that employees already understand that if they are not up to par, they won’t last long. And this is a result of Adobe’s management system, which puts managers and executives through regular, tough discussions with their employees, regarding their struggles to maintain performance levels.
This is why we mentioned that aspect of “involuntary departures” – if you, as an employee, know such a meeting will be scheduled for you, it will most likely not be an advantageous one.
Accenture has been changing 90% of its performance management system and replacing it with a more immediate, as-situations-arise-style of performance feedback. Similar with GE’s strategy, Accenture has also developed an internal app to aid employees in receiving immediate feedback about their work.
Ever since its beginning, Google has been using atypical methods to increase their team’s performance. The unique thing about Google’s strategy is that they use objectives and key results – OKRs, which are replaced every quarter.
Once these OKRs are chosen by the CEO, managers coach employees on how to fit and achieve their goals, so that they are in line with the company’s goals and objectives.
These companies bring new light to performance management by breaking boundaries and thinking outside the box. As such, it’s safe to say that in time, any company will eventually find its own method to measure and manage performance, even if it means going where no other company has gone before.
Annual reviews or other traditional methods are slowly becoming a thing of the past and rather than relying on a one-size fits all system like that, companies should try to find and focus on what fits them, not what everyone else is doing.