Forced Ranking Performance Appraisal Method– Is it really required?

The recent media update about Yahoo’s Marissa Mayer’s plan to introduce Forced Ranking method of appraising employee performance has raised quite a brow. While there has been a lot of criticism from some corners, there definitely will be some in silent acceptance. Before I make my case, let me give you some insights into forced ranking performance appraisal method. 

Forced ranking (FR) is a performance intervention, which can be defined as an evaluation method of forced distribution, where managers are required to distribute ratings for those being evaluated, into a pre-specified performance distribution ranking (Cooper & Argyris, 1998). In theory, each ranking will improve the quality of the workforce. Managers rank workers into three categories: The top 20 percent are the "A" players, the people who will lead the future of the company. They're given raises, stock options, and training. The middle 70 percent are the "B" players, steady-eddies who are given smaller raises and encouraged to improve. The bottom 10 percent are the "C" players, who contribute the least and may be meeting expectations but are simply "good" on a team of "greats." They're given no raises or bonuses and are either offered training, asked if they'd be happier elsewhere, or fired. As many as one-third of Fortune 500 companies use such systems, says Dick Grote, author of "Forced Ranking: Making Performance Management Work." Forced ranking first gained attention at General Electric in the 1980s. This is amongst the oldest methods and was aimed at –

·         End manager tyranny on ranking employees equal thus being unfair to the high performers or deserving members.

·         It was in vogue in those days when Talent Acquisition was still Recruitment and HR as Personnel Management.

While we have successfully made a transition from Personnel Management to HR Management to SHRM and have the best of the breed information systems, social medial tools and techniques, forced ranking still finds its presence. Many from the classical school of thought would contest that we need to go the Jack Welch way and differentiate amongst high and low performers and chuck out the non-performers.

I have always observed – “How did the non-performers or low performers find a way into the system?” or “If they were fine at the time of entry, have we investigated the reasons for deteriorating performance?” This calls for a tightly integrated HR function where Talent Acquisition is coupled with Performance management & Talent Management/Engagement. This is where we actually create & deliver value for our organizations as Strategic Business Partners. The late Steve Jobs at Apple Computers built a team of A-Class players as he would believe that only A-class members can appreciate the work of other A-class players.

Coming back to Forced Ranking method, it ‘may’ work in a highly structured or process oriented organization such as GE while may not at Apple or Google or Pixar or at our organization – May-I Consultants. This is seen to have detrimental effect on risk taking and thereby innovations as members tend to play safe. Moreover, why do you even need such a setup when your focus is on building an A-class team right from your strategists to hiring managers?

So what to do?

·         Instead have your performance managers define role-specific strategic KRAs and aligned KPIs integrated with the organization’s business strategy.

·         Set the motivations right.

·         Appraise your members on the set KRAs and drive your achievement goals.

·        Don’t shy away from giving instant feedback and associated corrective action.

·         Plan appropriate Action Learning Programs before taking the exit route.

·         You don’t need Forced Ranking Method.

I rest my case.

Visit us at www.mayiconsult.com and get in touch with us for your HR & Management consulting needs.

Closure - An Important aspect of Talent Acquisition Process

Look at the image above for 5 seconds.

Now, analyse what your mind was at while looking at the incomplete circle - Was it trying to make the ends meet or join? I am sure, most of us would get the ends meet. This is what psychologists call 'Closure' and human brains are wired to attain closure.

Recently, I came across individuals and bright ones for that matter who didn’t have very high opinion of some of the very good and known brands to work for.  The reason – “Apply, Apply but no Reply”. Many organizations, I know of, have a very good hiring process for the chosen ones or for individuals who swim across various stages of the selection process. The candidates definitely have a feel-good experience and they talk highly about it. However, not many organizations have a pleasant way of showing the red signal.

Organizations world-wide spend a great deal on ‘Employer Branding’ exercise in an attempt to lure the best available in the talent market. Even with available metrics it is extremely difficult for the organizations to justify the cost-benefit of these dollars. As many would put it – “We have high online virality of our company updates” or “We are the most talked about” or “We are the most searched for”. However, living with these incomplete notions and defining employer branding only till that is flawed. Each and every touch point matters while creating and leaving an impression.

The big question to ask is “How many of us have a feel good experience for the applicants throughout our hiring process?” Closure is an important part of human nature. We all desire closure and don’t want to have dangling situations. The dangling aspects act like a baggage and constantly nag our mind. I am sure each one of us early in our careers would have sent our resumes or emails asking on a probable opening/vacancy at a particular organization. Our reactions to revert and non-reverts would have been at the opposite ends of the ‘feel-good’ continuum; sometimes leaving a bitter feeling and at other times feeling courteous towards the organization.

A revert or a reply for closure may seem pithy and we may not pay much attention but to the applicant it may leave a pleasant impression and who knows your Talent Acquisition team may be bombarded with referrals by the non-selected candidates. Your TAT may create opportunities galore, creating a large pool of candidates.

A small action may reap huge benefits. Just Think. So have you mandated a closure for each application received by your TAT? If not, what are you waiting for?

Visit us at www.mayiconsult.com 

Leading the Culture of Accomplishment

Any good thought or idea is only half done till it is worked upon to deliver results. It becomes important for

HR professionals to facilitate interventions, provide tools and most importantly entice early adopters to gain acceptance and propagate the ideology to others. For a certain ideology to become a prominent element of the organizational culture, behaviors and activities aligning to the ideology ought to be rewarded. Continuous and later periodic interventions need to be planned and executed for the same. This draws from the theory of conditioning.

HR leaders and practitioners can device a number of

-          Procedures

-          Tools

Here are a few I propose:

a)      Personalized Portal: Each organization I believe must have an accomplishment portal for its employees with features such as

a.       Activities to accomplish

b.      Professional/Personal?

c.       Timeline – Daily, Weekly, Monthly, Quarterly, Half Yearly & Yearly

d.      Resources

e.       How?

f.       Make visible to other members?

g.       Seek help within the organization?

h.      Status – Red, Green & Yellow

The activities are made visible both to the individual as well his/her reporting manager. HR thereby has a database of all such activities the individual members wish to accomplish. These can help identify improvement areas, design developmental plans, succession planning, aid talent management, performance management, plan OD interventions and thereby retention.

b)      Accomplishment Boards: A bulletin board where the accomplishment stories get published. Accomplishments – irrespective of magnitude; individual, team or organization get published encouraging others to follow suit and motivate the accomplishers.

c)      Rewarding Group/Cross-team accomplishments: A culture of collective accomplishment goes a long way in building trust and collaboration within the organization. Rewarding group accomplishment also encourages thinking beyond and above self.

d)      My Champ: In one of the organizations, I worked, we launched this initiative where any individual in the organization could recognize fellow colleague who has in any manner helped accomplish a task/activity.

e)      Make it part of the performance management process: Organizational accomplishments need to drill down to management and then individual level making way through the goal setting process.

These action items can create the right climate for the organization to tread the path of accomplishment. 

Culture of Accomplishment - Deciding and Executing what Matters

This one stems from the several exit interviews, employee interactions and experiences of self and others. I have written this post more as a concept paper than an article.

The Problem:

High attrition, disengaged and disgruntled employees, low employee morale and thereby low productivity are issues that have plagued most of the organizations globally. The result is increased intrinsic and extrinsic cost for the organizations resulting in leaner bottom lines. Any action on cutting down costs results in a Catch 22 situation for the companies.

In a recent report released by SilkRoad, a HR software solutions provider, 86% of the employers struggle to create and maintain workforce engagement. In another article on ‘loyalty360.org’, ‘Measurement’ is termed as a weakness of employee engagement programs in terms of longevity and effectiveness. In the FORBES list of top 5 reasons for quitting jobs in 2013, stability, work-life balance and RESPECT have found mention. Two very important points can be deduced from all these articles, research papers and other literature on employee engagement and factors influencing employee longevity and effectiveness:

         1. The factors molding employee engagement are evolving.

         2. The premise on which employee engagement programs are based is flawed.

A Bigger Picture:

The only thing that is with the organization throughout its lifecycle and strongly influences its existence is its culture. Culture may get contaminated, invaded and normalized over the organization’s existence; however it exists. Culture is lasting; programs are not. Culture is what drives behavior, exchanges, morale and sets an unwritten agenda of how things are to be done and what is expected out of employees. It also strongly impacts the feelings, moods and emotional bursts that an employee may experience. Culture also channels the loyalty and longevity of the employees.

In my view which has crystallized with my experiences and those of others, culture has to be all encompassing and should stand for the values of the organization. A lot has been said and written about the culture of ‘Achievement’. However, there is very little mention of accomplishment in the organizational culture context. Elizabeth Curry, facilitator of the Sunshine State Library Leadership Institute makes mention of the following prominent cultures in her workshops:

1. Power Culture
2. Achievement Culture
3. Role Culture
4. Support Culture 

Curry states that one of above four cultures is prominent in the organizations while the rest though exist are not dominant. McClelland’s human needs motivation theory speaks of –

n(P) – Need for Power

n(A) – Need for Achievement

n(Af) – Need for Affiliation

My view of a culture emanating ‘accomplishment’ is the one in which all four – power, achievement, role, support are equally dominant and mutually interact with each other to collectively enhance the beauties of each culture thereby snowballing the overall positive impact on the organization.

Y Accomplishment:

“There’s nothing like seeing your own potential come to fruition and realizing your worth and intelligence as a human being”, quotes Mirella, a blogger in one of the blog posts. Besides, accomplishment caters to individualistic notions of accomplishment and thereby helps customize interventions to enhance individual accomplishments. A child’s sense of accomplishment may be very different from that of an adult. Even amongst children, the sense of accomplishment for a child playing soccer may be different from that of a studious kid. The beauty is even amongst soccer playing kids; sense of accomplishment for a goal keeper may be different from the one playing forward or center back. Same is the case with our employees in the organization and for that matter the employees in the same department or same team or subgroup. The other truly enticing quality of accomplishment is its inherent ability to sprout happiness within an individual.

The sense of accomplishment has longevity and also boosts your motivation to continue with your march – continuous accomplishment or path of new glory. Accomplishment can also be considered the pinnacle of an individual’s state of mind and heart.

In organizations, our employees may quit or may be disengaged or disgruntled citing reasons of insufficient compensation, opportunities, challenges, growth or even plain need for change or beat monotony. Understanding their sense of accomplishments helps the HR folks design, customize and drive interventions in the organizations. This also helps identify how individual strengths can be leveraged to deliver to the business strategy of the organization besides having happy employees at work. It is however important for HR folks to align individual accomplishments to the overall accomplishment of the organization. The organization’s sense of accomplishment may lie in earning revenues for its stakeholders, give back to the society, stand by environmental causes or just keeping all its primary and secondary stakeholders happy.

Culture of accomplishment goes a long way in helping us introspect on what example we wish to set for ourselves and others around. Also, deciding on what really matters and doing that.

 
I shall discuss on the tools and processes of enabling our employees in the next post. Till then, the point to ponder - Do we consider ourselves accomplished?