A typical ground-level reaction: “Managers think we aren’t sophisticated enough to connect the dots, but it’s obvious when our goals get disconnected from what really matters to the company.” Contrast that sense of meaning and purpose with the situation at many organizations where the goals of employees are too numerous, too broad, or too prone to irrelevance as events change corporate priorities but the goals of individuals aren’t revisited to reflect them. Linking employees’ goals to business prioritiesīuilding a foundation of trust in performance management means being clear about what you expect from employees and specific about how their work ultimately fits into the larger picture of what the company is trying to accomplish. Such shifts support a virtuous cycle that helps organizations get down to business on fairness.ġ.
In working with companies pushing forward on the factors our research highlighted, we have found that these require much greater engagement with employees to help them understand how their efforts matter, a lot more coaching muscle among busy managers, and some delicate recalibration of established compensation systems. And while embattled HR executives and business leaders no doubt want to be fair, fairness is a somewhat vague ideal that demands unpacking. As employers’ expectations rise and employees strive to meet them, a heightened desire for recognition and fairness is only natural. After all, organizations are demanding a lot more from their employees: they expect them to respond quickly to changes in a volatile competitive environment and to be “always on,” agile, and collaborative. Please email us at: research wasn’t longitudinal, so we can’t say for sure whether fairness has become more important in recent years, but it wouldn’t be surprising if it had. If you would like information about this content we will be happy to work with you. We strive to provide individuals with disabilities equal access to our website. These respondents were 12 times more likely to report positive results than those who said their companies hadn’t implemented any of the three (exhibit). Among companies that implemented all three, 84 percent of executives reported they had an effective performance-management system. Such factors appear to be mutually reinforcing. reward standout performance for some roles, while also managing converging performance for others.invest in the coaching skills of managers to help them become better arbiters of day-to-day fairness.Transparently link employees’ goals to business priorities and maintain a strong element of flexibility Our research suggests that performance-management systems have a much better chance of being perceived as fair when they do these three things: Of course, a host of factors may affect employee perceptions of fairness, but three stood out. More important, the data also crystallized what a fair system looks like.
Our survey research showed that 60 percent of respondents who perceived the performance-management system as fair also stated that it was effective.
This eye-of-the-beholder aspect is critical. It’s far from a platonic ideal but instead addresses, in this context, the practical question of whether employees perceive that central elements of performance management are designed well and function fairly. When we speak of fairness, we’re suggesting a tight definition that academics have wrestled with and come to describe as “procedural fairness.” 1 1.įor additional research and insights into fairness in the organization, visit. In this article, we’ll explain the importance of this fairness factor, describe three priorities for addressing it, and show how technology, when used skillfully, can reinforce a sense of fairness. And certain experiments have gone awry: at some companies, eliminating annual performance reviews without a clear replacement, for example, has led employees to complain of feeling adrift without solid feedback-and some employers to reinstate the old review systems.Īmid ongoing dissatisfaction and experimentation, our research suggests that there’s a performance-management issue that’s hiding in plain sight: it’s fairness. Half of the executives we surveyed told us that their evaluation and feedback systems have no impact on performance-or even have a negative effect. Managers still see performance management as a bureaucratic, box-checking exercise. Employees still complain that the feedback they get feels biased or disconnected from their work. Yet companies don’t seem to be making much headway.
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