Change HR Practices!

Major firms are doing away with annual or semiannual performance reviews, news that generated a bit of a buzz.

In the various companies I’ve worked for in the past, very often performance review time was when I was told to evaluate myself and then submit my own assessment to the boss, who will then “bargain” the ratings down; we would agree on a “compromise” and from there, salary adjustments and bonuses are then decided.

And the supertalented HR people who oversaw all that went on to become Managing Directors of HR – yes, such titles exist! –  or VPs of HR or VPs of Talent Management or Chief Talent Officers – yes, yes, such hifalutin titles indeed do exist! – in big, world-famous corporations.

Why am I wriggling my toes? Oh, because they are laughing, since you asked. I bet those HR honchos are also experts in balanced score-cards, data analytics, executive training, coaching and mentoring, labor laws and competency models too; HR know-it-alls.

Some companies even have quotas on how many promotions are allowed for a certain period of time and even if you make it, you will not receive your due rewards. I know a star performer who was eventually let go, because HR told him “It is now cheaper for us to hire three Indians than to keep you, despite your having far superior qualifications and have a proven, verifiable track record for the past ten years.” This was said by the HR fellow with a straight face, who, by the way, is still working in the same organization. No wonder many people have the impression that most of the time, HR practitioners seem to treat preserving their own jobs as the number one priority in life.

If you ask me, the entire HR dog and pony show needs a major shakeup.

Such practices by revoltingly unqualified HR “professionals” make a mockery out of performance reviews and if these practices still exist, they should indeed be scrapped altogether.

Also, often performance reviews consider the tangible results; for example, some employees are judged by the volume of business they can generate. In fact, with a certain company I’m acquainted with, almost all country general managers are promoted into that position as a reward for having being good salespeople.

Sure, you may be a super salesperson, but if your nasty, arrogant, and cocky attitude leaves a trail of broken toes behind, how should you be evaluated during performance reviews then? Few systems take into consideration your EQ and intangible qualities like that. And companies are short-sighted if they only value rainmakers.

In fact, there were a number of times when I accompanied various country general managers to client meetings and I had to cringe when they talked like used car salespeople in front of CEOs – complete with splattering saliva. It’s a sad day when you are ashamed of your own country general manager.

Brand name companies announcing that they are stopping performance reviews makes for great PR, but if you really think that these companies are abandoning the tracking of employee performance, then you must be really naïve. Even religious organizations track their staff!

No matter what they call it, all companies have one form or another of monitoring employee accomplishment, even in those companies that say they have stopped performance reviews altogether. What gets measured gets done.

Reviews are part of performance management, so what makes an effective performance management system?

An effective performance management system must start with a detailed goal-setting process between the manager and the staff who will be managed and whose performance will be reviewed. Goal-setting of KPIs must be a joint exercise because if you shove these down the employee’s esophagus, there will be no ownership, and literally nothing will happen.

Next, regular feedback and appraisals must be carried out. And not the way one of my managers did it before. She responded to each of my detailed monthly report with a one-word email: “Noted” and refused to meet me face to face, because she had zero idea of my subject matter expertise. “No need to meet,” she told me, “nobody complains about you, so you must be doing great. Besides, I don’t understand what it is that you are an expert of.” Incidentally she is now with a very well-known multinational corporation as head of HR for Asia Pacific and on LinkedIn, she has listed that expertise of mine she claimed no knowledge of as a core strength of hers. Unbelievable!

Now you know why I said HR needs a major shakeup.

A good performance management system also identifies employees’ developmental needs and includes vigorous reward and recognition practices. We don’t live in an altruistic world, unfortunately; people don’t work for philanthropic reasons – even pastors get handsome salaries, complete with CPF –  and they must and should be incentivized, especially for exceeding performance goals.

The system should also encourage collaboration and teamwork. A “superhero” working alone adds no value. I have had colleagues in the past who hid in a corner and nobody could fathom what it is they do but they are “untouchable” because they had “godfathers” who protected them. Yes, if I reveal the name of the company, you will be shocked, but that was what happened and is still happening.

See How Not to Change from Hero to Zero.

What is HR, the so-called custodian of organizational conscience, doing amidst all these shenanigans? I suspect, most times; they were just being used as henchmen of the corporate “mafia” that exists in every company.

Experts agree that fundamentally, a performance management system is composed of process and people elements. The process element includes items such as job descriptions, rating criteria, the time period of performance appraisal discussions, and reward and recognition systems. The key component of the people element is the manager, who drives the system by setting expectations, communicating plans, encouraging development, and giving and receiving feedback.

But most companies invest in world-class processes for their performance management system, but overlook the importance of the people element.

A company might have a world-class performance management system in place, but the system is only as effective as the managers who implement it.

The human element is the most important component in whether employees perceive the system as effective. The relationship between an employee and his or her manager is the key factor in driving those perceptions.

These are what the experts are saying.

Contrast that to what is happening in real life!

Companies that want to increase organizational and employee performance and productivity must put in place the right managers; those who refuse to meet their subordinates because they are intimated by their subordinates’ knowledge or reply with one-word emails should not be hired at all.

Because when they eventually worm their way into multinational corporations and become regional heads of HR, the damage they inflict will be a lot more than when they were doing just a local job.