If you happen to ask line managers how they manage the performance of their employees, in my experience you’re likely to receive a variation on one of two responses:
- ‘Oh, I understand the disciplinary process, I know that if an employee isn’t performing then we need to go down the formal route.’
- ‘Well, we have an annual appraisal, so I’ll tell them then how they’re doing.’
If you’re new in a management role, from the examples above it can become very easy to make the mistake that performance management is a one off, annual event, as opposed to the ongoing, proactive process that it needs to be in order to really deliver results.
A snapshot in time
I have a personal hatred of the annual appraisal process. Why? Well, I’m yet to find an organisation where it truly works. From the perspective of a line manager, it’s generally seen as little more than an administrative burden, a pile of ‘school reports’ to write which distract you from the day job. Once a year, managers are faced with the onerous task of sitting down and typing up a summary judgement on each individual employee. For most of us, it’s unlikely we can remember much past the previous two weeks – making the phrase ‘annual appraisal’ something of a misnomer. Instead, this becomes more of a ‘snapshot in time’ of an employee’s performance, with performance gradings being raised or lowered based on something as subjective as whether the employee is currently in or out of favour with their line manager.
From the employee’s point of view, an appraisal is at best something to be endured, at worst, something which actively creates fear and tension – quite the opposite of the desired impact! Most employees – myself included – have gone into these annual appraisal meetings with very little idea of what to expect. Will we currently be in favour, or will this instead be a damning indictment of every minor misdemeanour we’re perceived to have committed over the past few months? I know of one line manager – not a Benefexer! – who, when an employee had completely failed to deliver a key project, said that they weren’t going to speak to them about it. When asked why, their response was simple: ‘I’ll talk to them about it in 3 months when I sit down with them for their annual appraisal. We can pick it up then.’ So, in this instance, the employee has no idea that they haven’t delivered, has had no opportunity to improve and deliver the results the business really needs…and then is greeted with an unexpected dressing down when they attend for their appraisal meeting. Not exactly a great outcome for anyone, is it?
It was with all of the above in mind that I sat down to look at how we proactively manage performance and support our employees to deliver results here at Benefex. I knew from experience that an annual approach was unlikely to work. I wanted something which mirrored our culture and how we work here: proactive; dynamic; responsive to change. And that’s when Matt – our CEO – introduced me to the OKR framework…
The OKR approach is a model which was first developed in the 1970s by Andrew Grove, then President at Intel, and has since been picked up and run with by a number of organisations, including LinkedIn, Twitter and Google. Most importantly, it is glorious in its simplicity and the mutual benefits it delivers for both employees and organisations alike.
The acronym stands for Objectives and Key Results. In short, the principle is that OKRs are set for the company and the teams and individuals within it: a set of structured objectives measured by the delivery of key results and working towards one common goal. By aligning targets in this way, logic follows that the overall delivery of an organisation towards its strategic plan will be that much more effective.
OKR meets CPD
When it comes to individual employees, OKRs set the objective framework for their performance to be reviewed against. Here at Benefex, we have this year trialled a programme whereby OKRs are set alongside an employee’s personal learning goals and are supported by a CPD (Continuous Professional Development) record, all of which should complement each other. The OKR framework should be used at each monthly one to one which a manager holds with their individual employee, to set new objectives, review progress against existing ones and use this to target new learning and development opportunities. Because the OKR framework is absolutely objective – one of the key principles being that OKRs should be able to be picked up by anyone in the organisation and, based on the available evidence, it will be clear as to whether or not the objective has been delivered – all of a sudden performance management steps right outside of that subjective circle of whether or not you feel like that employee is doing a good job right now, based on their performance in the last two weeks. Instead, you have a clear set of criteria upon which to measure success, and a real-time approach to driving performance forward.
Keeping it real
From the employee’s perspective, all of a sudden performance management becomes something which is real, frequent and genuinely motivating. We know that an employee who receives regular feedback on their performance is far more likely to be motivated and engaged, and therefore delivering great results for both that individual and also the wider organisation. Which, however you choose to look at it, is a pretty great outcome all round.