With all this talk of the downsides of performance management going on in the blogosphere, I thought I might take a look at this from the employee perspective. Hey wait, I AM an employee! Thusly: Some reasons why I, Max Goldman, like performance management and wouldn’t want to work for a company that didn’t do it - a brief list:

1. What the heck is my job again?
Being just one piece of a bigger entity like a company is not an easy thing. It’s sometimes hard to know what part I need to play to add the most value. I want to add as much value as possible because I want to advance my own career, make more money and do something important with my life. Our performance management system lets me understand what I can be doing to support the company’s larger goals, know what’s expected of me and find opportunities to do bigger and better things.

2. Why is THAT guy driving a free Touareg?
At our company meeting this past January, four VW Touaregs were given out to top performers -people who add a lot of value to the company and our customers. Two went to salespeople. They bring in the bucks, so fine. But two went to regular employees. Why are they driving brand new, free cars (or getting watches, vacations, bonuses – you get my drift)? If I know why, I can work at those qualities and results and get myself a brand new ride next year. But what are those qualities, what is the measure of success? Without performance management, it’s anecdotal, arbitrary and simply unfair.

3. What is this company doing, anyway?
I now know what it is I’m meant to be doing (see #1), but what is everyone else doing? Why does any of this matter? What is this company striving at? What are the strategies and tactics that will make us all (and me, particularly) successful? Our performance management system lets me understand that. How what I’m doing aligns to what my boss and his boss are working on. Why what I’m doing matters. And I want it to matter.

4.  What’s wrong with me?
I admit it – I’m not perfect. I’m close, dammit, but I’m just not there – yet! What can I do to get better? What areas do I need to work on to perform at the next level? Without performance management maybe I’ll figure it out and maybe I won’t. With performance management, my development needs are outlined and I can know where I need… (ahem) work. Even better, I can get my boss to agree so when I nail those things, he has no choice but to admit it.

5.  What’s great about me?
Like I said, I’m pretty close to perfect – now tell me about it! It makes me feel good and lets me know I’m on the right track. Performance management forces my peers and my boss to tell me what I’m good at so I can lord it over everyone and do my special victory dance. Ok, no dancing, but you get the idea. People, myself included, like to know what we’ve done well so we can keep doing it.

6. Pay me more money. And a bonus, too.
What’s that, I achieved every goal we set out? Nice. Pay me. When I know what I’m being measured on, I can work against those goals. When I achieve them, there is no choice but to recognize my performance. If the company doesn’t, I can take my clear track record of success elsewhere.

What do you all think? What are the reasons you like (or dislike) the results of your performance management system or process?

Here’s an interesting article called “Americans work more, seem to accomplish less” that prompted an equally interesting discussion on the TRDEV Yahoo discussion group. The gist? Whether the mere act of measuring performance itself has a negative impact on employee morale, and thus productivity.

A quote in the article from John Challenger of Challenger, Gray and Christmas explains the perspective: “there’s a trend among companies to measure job performance like never before. There’s a sense that no matter how much I do, it’s never enough,” he said.

To me, it brings us back to the importance of communication in the change management process. If employees understand what is expected of them and what the benefits TO THEM are, the likelihood of positive change is increased. 

What’s your reaction?

Our good friend Dubs thinks performance management is wrong. Not just broken. Not just in need of improvement. Flat out a flawed paradigm for improving company performance.  Perhaps predictably, I find it difficult to agree. I’m not saying that the current concept of Performance Management is perfect, but I’m not ready to call it worthless and scrap it either. Read on for the reasons why.

(more…)

I was forwarded this soon-to-be infamous email exchange between a spurned hiring lawyer and an uppity law school graduate today. It’s remarkable how little emotional intelligence is displayed on both sides. Sometimes it takes a little effort and common sense to be polite, but it’s usually worth it – and especially so when you’re a want-to-be member of a small professional community.

It reminds me of all the times I’ve encountered such things in my own professional career. I once had a boss who was so generally offensive for lack of emotional intelligence that her staff was a constantly shifting grouping of people who rotated into her department hesitantly and out of her group as quickly as possible. Vendors would refuse the company’s business once they understood who they’d be required to work with. But this company had no formal performance management or 360 process that would have enabled the feedback that may have had a chance to fix things. The result was a largely ineffective group.

Changing people’s behavior is one of the most difficult challenges there is, but without an infrastructure for providing feedback, it’s virtually impossible. Hank Paulson, the CEO of investment bank Goldman Sachs delivered a memorable quote that I picked up somewhere:

“One of the things we have done for years is 360-degree reviews.  It’s amazing when you go to a leader and say, “There are 30 people who reviewed you, and 30 of them trust you.  But all 30 say you don’t listen well.”  It has an impact.”

 

I was wandering around the Internet today as I tend to do. It’s a nice place, you should visit. Anyhoo – I landed at the SalesForce.com website. Anytime I’m looking for enterprise software communications best practice, I end up there. It’s really a masterwork of a website – and when they released their status page a little while back, I simply had to bow to their ability and willingness to be transparent.

But they’ve got this one line on their homepage where they state their number of customers, subscribers and languages. There is no doubt that their subscriber numbers are impressive. 400k. Four Hundred Thousand. 400,000. It’s a ton for any software company and a true victory for a Software-as-a-Service house.

It’s no small accomplishment and they don’t need me to point it out.  But I can’t help but chuckle to myself just a little bit when I look at that number -because our number of subscribers is 1.4 Million. More than 3X. 

Just had to mention that. And while we get to count up to 1.4 Million (it takes a while), it’s really our customers who deserve all the credit. It’s only through their feedback and support that our products have matured as far as they have,  and it’s only through their success that we’ve been able to come this far.

To be transparent myself – SalesForce is a customer of ours, and we’re a customer of theirs. We’re proud to be counted among their 400k.

This one should have made it into our worstreview contest.

Via Regina comes a performance review that perhaps many employees would love to give, but don’t. There are probably a few lessons to be derived from this, but at least one is – companies of all types are better off creating a proactive review process that invites feedback than having their management reviewed in public after an entire shop  of employees quits simultaneously.

Another take-away from Phil is that people don’t quit jobs, they quit managers.

Performance and talent management in healthcare is a big issue. Yesterday, an NYT article talked about the incentive structure in medical professions. Essentially, healthcare professionals are paid to “perform tests and to do surgery and to dispense drugs.” Not to make correct diagnoses and save lives. The correct incentives are misaligned with pay and “You get what you pay for,” said Mark B. McClellan, who runs Medicare and Medicaid “And we ought to be paying for better quality.”

Remarkably,  “studies of autopsies have shown that doctors seriously misdiagnose fatal illnesses about 20 percent of the time.”  Believe it or not, this is the same rate as in the 1930’s. Almost 80 years has gone by, and even though we’ve made amazing progress in medicine, doctors still make bad diagnoses fairly often. But things may be looking up. According to the article:

There are some bits of good news here. Dr. McClellan has set up small pay-for-performance programs in Medicare, and a few insurers are also experimenting. But it isn’t nearly a big enough push. We just are not using the power of incentives to save lives. For a politician looking to make the often-bloodless debate over health care come alive, this is a huge opportunity.

Why Doctors So Often Get It Wrong – New York Times.

Another NYT article from last year on the topic of pay-for-performance in healthcare:

“By the end of this year, more than 600,000 Medicare recipients will be in test programs that pay doctors and hospitals bonuses for achieving better results, like increasing the number of diabetic patients whose blood sugar is under control.”

In business, but especially in the technology world, you can sometimes figure out what a company is planning by looking through their job descriptions. As an example, here’s an old post from one of my favorite gadget blogs, engadget, about Apple potentially making Ipods wireless – based on a job description they found on the company’s website. (The company later worked with Motorola to put Itunes on a cell phone)

The point is, you can sometimes divine a company’s intentions by seeing who they’re looking to hire and what skills they want those people to have.

I was directed to this job posting for a consultant at a company we are sometimes compared against. It includes skills such as:

• BS in Computer Science with related experience
• Significant Web Application Development experience (SQL Server, Oracle and/or DB2, HTML, Java script, Server-side scripting ASP JSP)]
• Interaction with client IT directors and managers

Now, here are some bullets from a requisition for a consulting position at SuccessFactors:

• Several years of experience in software integrations within or for a Human Resource Department.
• Experience in HR practices, as well as PeopleSoft, Lawson, Oracle or other HR software preferred
• Extensive HR background in Organizational Development, Leadership Development, Succession Planning, 360 Review, Core Competencies, etc.
• Experience with managing the Quality Assurance processes for software implementations
• Excellent oral and written communication skills
• Technical understanding of software operating systems and ability to work comfortably with HRIS engineers.

The difference should be plain. SuccessFactors consultants are hired because they know HR – and are focused on solving HR business problems. Others are hiring software focused consultants because they are focused on delivering a piece of software.

Who would you rather have on your side?

For further reference, you might want to check out this piece at ZDNet about the real meaning of on-demand versus traditional software.

Our very own Elaine Chen (product manager extraordinaire) pointed me to this just for fun article at MSN Careers. Since we just finished up our contest at worstreview about the worst reviews ever, I figured I’d point you over to some stories about the worst bosses.

If you’ve got one to share, feel free to put it in the comments.

As per The McKinsey Quarterly – #5 on the list of top trends to watch in 2006: 

The battlefield for talent will shift. Ongoing shifts in labor and talent will be far more profound than the widely observed migration of jobs to low-wage countries. The shift to knowledge-intensive industries highlights the importance and scarcity of well-trained talent. The increasing integration of global labor markets, however, is opening up vast new talent sources. The 33 million university-educated young professionals in developing countries is more than double the number in developed ones. For many companies and governments, global labor and talent strategies will become as important as global sourcing and manufacturing strategies.

The McKinsey Quarterly: Ten trends to watch in 2006.