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Top Employers Institute

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Dec 1, 2016

Why The Boss Is Becoming The Coach

 

Performance management is evolving to a more collaborative, open dialogue between managers and employees

 

Business cultures are evolving as organizations become flatter and more agile to align talent with business goals and strategies. And these changes are forcing many HR functions to change with them.

 

One of the most dramatic changes we are seeing is in the area of performance management. Gone are the days of annual reviews and other formal, passive methods for measuring employee performance.

 

By some estimates, more than 1/3 of U.S. companies - from Silicon Valley to New York - and in offices across the world, organizations are replacing annual reviews with frequent, informal check-ins between managers and employees.

~ Peter Cappelli & Anna Tavis, Harvard Business Review

 

Managers are transitioning into coaches and employees are rejecting forced rankings, revealed Top Employers Institute’s recent Performance Management HR Insights Report.

 

Traditional annual review programs are backward-focused, holding people accountable for past behavior, versus focusing on improving current performance and priming talent for future leadership roles. 

Traditional performance review programs also leave employees with little control and input. So it’s no surprise leading-edge organizations across all industry sectors are favoring a more responsive and progressive approach. One that goes beyond the once or twice-yearly “check-in” and favors collaborative dialog and feedback. Goals are flexible, more agile, and embedded in the day-to-day operations of a person’s given job function.

 

Many companies, such as Microsoft (see our case study), Deloitte, GE, the Gap, and Adobe Systems, have shifted from annual reviews to programs that support coaching for development, with a greater emphasis on teams, versus the individual.

 

A manager’s ability to provide timely, honest and constructive feedback is a skill in and of itself and should be part of the leadership culture from the beginning. People want managers who:

  1. regularly engage with them about their work and progress, and
  2. routinely share how their performance is evaluated.

 

The good news is that organizations are ensuring managers can fulfill this new role as coach. Among Top Employer certified organizations, managers are routinely instructed and trained to provide their teams with open and constructive feedback on an on-going basis. Our study shows that it’s as high as 93 percent among #TopEmployer certified organizations.

The idea of coaching is in direct response to employees not wanting to be ranked in their organizations. Ranking encourages competition over collaboration. Companies are realizing this and changing their practices.

We saw a great example of this from Microsoft, which completely overhauled its performance and development program by removing all ratings and moving to a conversation-based approach. (Read the case study on Pg. 14 of our HR Insights Report)

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