Soon, the Millennial generation will be the majority of the workforce, and GenZ is already knocking on the door. These generations look at ‘work’ differently than the generations before them. They often see work and the company as a ‘project’ where you stay as long as you can learn and grow. You move on when this is no longer the case. With this in mind, it is time HR completely revises the way they approach and manage these generations.
Both generations are often referred to as the Facebook generation. They expect clear feedback from their superiors, straight away, and not just three times a year. They want to develop themselves and therefore expect their managers and company to have a clear path forward for them. And, last but not least, they want to work for a company that matters. If the company has no moral compass or WHY they will not stay – if they ever join in the first place.
It is obvious that you can’t get away with the traditional nineties cycle of Goal setting, Mid-Year review and End Year Review. In this blog I will try to explain some of the rules and lessons learned that I think are important.
In the end, it’s all about employee experience. This means you can’t rely on ‘performance management’ alone: you need to check and possibly revise all end-to-end HR processes that are related to performance (e.g. talent management, Succession, career paths, etc.).
Keep it Simple
Old performance management systems are often too complicated and tend to deviate from their main purpose: to encourage dialogue between managers and employees. I have seen all kinds of systems; some only consist of goal-setting and evaluation, others included complete competency libraries. In the latter, you often have an enormous book with all kinds of competencies the employee needs to master at five different levels. I hate to break it to all HR professionals, but no one ever uses these libraries.
Keep it simple and encourage frequent dialogues that focus on two-way feedback and growth.
Kill Mathematics and go holistic
Most of the nineties tools (especially in engineering companies) have a mathematical approach. The employee is scored on several items, sometimes with a different weight, and the IT system eventually calculates the end score, preferably to two decimals. I have many times witnessed how managers and employees had endless discussions about why the employee scored 3.17 this year, while last year it was 3.25. Nobody benefits if people can hide behind numbers.
My advice: Go holistic and kill mathematics. Neither managers nor employees benefit from the mathematical approach. When you go holistic you solve this, and the manager needs to explain his end year review to the employee anyhow.
Focus on WHAT and HOW
New generations are genuinely interested in achieving goals and receiving the reward (the thumbs up) for it. They also want to work for a company that matters and represents values they themselves can identify with. The HOW in this example are the behavioral drivers that the company deems necessary to reach success in a respectful and sustainable way.
As a rule, focus on both WHAT (goals) and HOW, and treat them as equally important.
Install Continuous dialogues
You can’t get away with three formal meetings per year any longer – nor should you want to. The new generations expect instant feedback, but they also want to give instant feedback in return. As mentioned above, the Facebook generation wants to get their thumbs up immediately, or know where and how they can grow. Therefore, make sure you design a process that encourages continuous dialogue, and log progress and feedback in a state-of-the-art system like Workday or SAP SuccessFactors.
It is a two way street
Both parties are equally responsible to make things happen. And yet, in 2018, I still come across employees (some even at directors level) who complain that they have no clear goals or that their manager did not give feedback during an End Year review. With the new generations, I expect the chances of such complaints are lower – they will come and get it! – but it wouldn’t hurt when you implement growing and feedback as an explicitly Shared Responsibility.
For all employees
All employees want to receive feedback and to know how they can grow. And still, a lot of (manufacturing) companies only rely on performance management for their indirect workforce. I just don’t get it. Is it not obvious that when you give people attention, feedback and the ability to grow, they will value your company, work hard and stay? They will work for you with their blood, sweat and tears, as Simon Sinek once said. If you treat people as disposable employees they will only come for their paycheck…
It’s all about development
Employees respect honest feedback that helps them grow. The best and most simple way I came across to achieve this were the following feedback guidelines a manager must give their employees:
1: Keep doing
2: Stop doing
3: Try this.
Simple, sound and to the point.
The new generations want to know why they have to do what they are doing. They want to understand how they contribute to the ultimate goal of the company. It is therefore necessary to cascade goals top down and bottom up so everyone can identify their personal goals with the company goals.
Calibration is vital to ensure a uniform way of working. Should you install forced distribution? Absolutely not. But when the sample size is big enough (50+ comparable employees) you should expect a normal distribution. If not, you should understand why this is not the case. If you can’t, adjust the ratings.
Good luck and feedback is welcome!
Originally posted on Linkedin: https://www.linkedin.com/pulse/millennial-gen-z-performance-management-10-golden-bas-eggelaar-mba/