Getting Performance Without Performance Management

There are a number of key issues. Bearing in mind that the economy is one of the key factors underpinning organisational performance and that forecasting a year in advance what the country's economy will look like has proved well nigh impossible, the idea of yearly fixed targets does not make any sense. The second issue is that most people know whether they have had a good or a bad year, but many of the current systems do not encourage honesty. Thirdly is the question of motivation - do we really believe that most performance management systems motivate the majority of individuals?

The question of team goals in interesting and certainly if you want to create a team and collaborative culture only rewarding individuals can be a real hindrance.

Hi Peter

Yes i agree on budget and hierachy issues that they need to be sorted out , also my point is that the lenght period of perfomance linked to a financial year end and determined at the end of the year provide no purpose or gaurantee for performance incentive, to improve performance and make it live and promote consistence performance it should take the old approach when people get performance incetives every month or once you achieve something measurable, because in my previous employer i performed and implemented a lot of projects with excellence and praises from management and executives at the end of the day i left the company before end of March (Financial period) the policy say you must still remain in the company until the end of the financial period to qualify for incentives, though i feel i should have been incentivised immediately to be kept motivated, maybe i would still be working there, rather that waiting for the financial year end. In some cases the would say it will depend on the affordability, which has nothing to do with my excellent performance, now how can i achieve or be measures on the affordability of the company as an individual where i was told i will be measured on my outputs, the reason for this is that they wait to see what will happen then at the end of the financial period some decisions to spend money are used becouse they know there is performance money still waiting until next year and temper with it and tried to provide supposingly reasonable explanation to use the money and not to pay out performance i.e mensions recession and other money used for court cases of disgrungled fired executive and given the golden shake hand if the case is tough others, which now demands that all these unexpected events should also be budgeted for to avoid tempering with performance incentives becouse the money end up in the wrong hands and used for a different purpose.

Hi Peter,

An interesting way of addressing the role of budgeting in performance management. I took what may appear, at first, to be a diametrically distinct approach, but I'm wondering if they aren't just two sides of the same coin.

From the sound of it, you are proposing empowering smaller teams closer to the front lines (presumably meaning customers and critical supporting operations) by giving them more control over setting and managing their budgets and holding them accountable for the metrics (KPI's) justifying those budgets and spends. The performance being managed, then, is that of small groups, not individuals, and specifically as it relates to the ultimate financial performance of the collective whole - the profitability of the firm. Correct anything I've gotten wrong.

This makes sense, and it could offer real improvements to how budgets are managed today. How investor expectations would be reconciled with this schema might be an area worth further investigation. After all, budgets are (mis)managed the way they are in part because of the pressures put on public companies by investors.

I also like how team, group and company incentives can be used to encourage collaboration and collective action. Individual performance, however, cannot be disregarded entirely. The best performers are frequently highly intrinsically motivated individuals. They want to measure their progress toward both collective and personal goals - to borrow from Daniel Pink, they seek both purpose and mastery respectively. Money often becomes just a rough proxy for how they are doing; it's the reason Wall Street traders are so quick to jump ship for another shop despite already making tens of millions of dollars.

In my hack ("Mastery Feedback Loops"), I focused on individual performance and left managing team performance as an unanswered question; your hack could be part of the answer to that question. While budgeting seems to be central to your hack, I proposed actually decoupling compensation and promotions entirely from individual performance management to be free of fiscal constraint entirely.

I'd welcome your thoughts on how to optimize both individual and team performance. Could these two hacks be used in combination for teams and individuals?

Ben

Peter,
I like the fact that your model enables rewards to be based on whether the entire team, group/ company are successful. It encourages teamwork and collaboration to ensure everyone makes an effort to not only get along with but help each other so that the entire team can succeed. Furthermore, it keeps the entire team united and moving forward in the same direction rather than efforts being wasted by individuals competing with each other. Why should they when they are on the same team?

I think your model and the "Contribution Compass" model combined would be ideal as that one also takes into consideration each employee's individual development, which is crucial to maintaining their engagement, high levels of productivity and creativity.

I would like to volunteer to develop this model further. Thank You.

Thank you for sharing your ideas about budgeting, authority and etc. Other participants shared their ideas for learning, reviews and other subsystems, that have impact on performance.
There are so many varieties based on the level of organization life cycle , human beings which are at different ‘levels of existence’ as well, their personality type per Myers-Briggs, their age and sex type that makes impossible to find one solution of performance management for every combination above factors.
Optimum performance in a work situation only when there is congruency in the total managerial situation, which includes:
- Methods for managing
-The manager or supervisor utilizing the available methods
-The supervised person - the one who is expected to respond to the methods
-The nature of the work being done by those who are being supervised or managed.
We can approach optimum equilibrated performance of any system only when its subsystems are all in phase and in phase with the goal of the total system.
The effectiveness of organization depends upon the harmonization of organization, culture, labor engaged, managerial style, incentive system or other facets of organizational inputs.
It was said 40 years ago and my management experience lead me to the same conclusion.
Processes (including performance management) can be different the principle is do not have negative impact on people as individual because everybody has own ‘levels of existence’.
We have to admit that we have to have and apply different ways to get things done, including performance management.
I reworded what you said and add to expectation from employee: Only employee can achieve their own performance.
With regard.