We now want to review the systems at other companies known to have
good ones. I have bragged about the wisdom on this list and would like
to seek feedback on what we have to-date as discussed below - here's an
opportunity for this list to have a direct influence on a large system
about to change. Additionally, I would appreciate any recommendations
on other companies that have a good performance system and a point of
contact, their location and/or telephone number if possible.
As this list of systems thinkers would suspect, the emerging impacts
this system has on the other systems is growing. The site has
initiated separate teams in some of these areas also. The need to
integrate them all is not yet generally understood across the site.
This will be one of the key challenges. It will be interesting to see
how this develops, especially with the August deadline right around the
corner. Am looking forward to your comments.
Geof Fountain TFYY93A@prodigy.com
Background
Our site is a U.S. government-owned, contractor-operated collection
of manufacturing and R&D facilities spread out over 300 square mile
area with about 14,000 people. We have gone through two downsizings
with the possibility of more in the future, dependent on decisions over
new long term missions.
The site has one primary contractor. In the contract renewal coming
up this year, the current primary contractor is partnering with three
other companies. The Performance Evaluation team has representatives
from all four partners. All the companies are global - three are U.S.
based, one is U.K. based. The team is tasked with developing one
system for this site for all four partners.
The scope includes both exempt and non-exempt work force. The non-
exempt is non-union and receives annual increases based on a
predetermined scale with no movement or compensation tied to
performance (the exception is promotion to firstline supervisor or
specialist). Exempt employees currently receive an annual performance
review and performance rating (scale of 1 to 5), which is the primary
input into the merit raise process. Standardized percentage merit
raises are based on performance rating and one's position in their
salary range. Raises occur between 11 months to more then 24 months,
depending on the above.
The team has settled on the following initial, rough framework.
Purpose
To provide an annual review of performance which identifies strengths
and weaknesses of the employee and allows for two-way communication in
areas of improvement as related to job responsibilities and enhancement
of capabilities as related to career interests.
Key attributes of the system
* frequency - annual review with optional progress reviews
* exempt and non-exempt - one system for all
* expectations - consists mainly of a specified list of core and job-
specific qualitative dimensions and competencies; de-emphasizes task
and time oriented objectives, which should be included in other work
management tools (ie, a project list); allow blank space to add
customized expectations
* salary - no direct tie to compensation system via a performance
rating (number or category)
* ratings - none; focus is a positive/productive discussion on
strengths, weaknesses, and development; the team thinks ratings
negatively affect that dialogue; however, one thought is to include a
sat/unsat if the unsat is needed to tie to some kind of annual
compensation; not sure at this time
* job changes - a performance evaluation should be completed anytime a
person moves, supervisor or worker
* peer ranking/forced distribution - none; however, the question of if
and how to compensate individual merit annually received a lot of
discussion and is an issue for the compensation system; the U.K. system
has no annual individual merit-based compensation (seems similar to
Deming's philosophies)
* employee comments - include section for employee to add comments and
have a management review signature after that section
* feedback - informal feedback from peers, customers, subordinates,
managers; the formal 360 process was discussed and has a place but
seems too time consuming to be part of the year-end review; the
importance of the informal 360 process will be emphasized in the
training
* training - provide initial and annual training; the training should
also have a feedback loop to identify improvements in the system and
implementation
The team has also begun to identify relationships between the
performance evaluation system and other site systems. The story of the
elephant and the five blind men comes to mind, raising the question
"what is the elephant ?" in this case.
Expected system relationships identified so far - - -
Compensation system
Perfromance Evaluation (PE) should be one input to the compensation
system. PE should not provide ratings to the compensation system from
which to determine merit increases.
Career Development system
PE is not an input to this system. Career aspirations and
development plans should be an input in the PE system.
Seniority System
There should be no tie between the performance evaluation (PE) system
and the seniority system. Both PE and Seniority systems are inputs to
other systems, ie, promotion, career development, compensation, etc
Promotion/Assignment system
PE reviews should be one factor in determining selection for
assignments and promotion. Other factors include skills, seniority,
business needs, etc.
Business Objectives
The PE should not be an input to the business objectives. Business
objective can drive PE system expectations, ie, a business objective to
reduce operating costs by 10 % can result in a qualitative expectation
on participation/generation of cost savings initiatives
Discipline system
Serious performance problems (beyond weaknesses) should be handled
with a separate system. PE reviews may reflect a sustained
disciplinary problem.
RIF
PE may be one input. Others would be qualification, seniority, etc.
--TFYY93A@prodigy.com (MR GEOFFREY F FOUNTAIN)
Learning-org -- An Internet Dialog on Learning Organizations For info: <rkarash@karash.com> -or- <http://world.std.com/~lo/>