Traditional approaches to performance management deliver little, zero or negative impact. This is particularly true amongst knowledge workers and millennials who crave autonomy, learning and a sense of purpose.
Many organisations, have too many, and often conflicting, KPIs, and up to 80% of time spent on performance management is administration rather than development and coaching. Extrinsic motivators do not increase engagement and performance for creative thinking such as complex problem solving, innovation, etc.
Most of us have been aware of these challenges for many years, yet leaders and organisations are still struggling to develop something that really works. At PwC, we develop performance processes and solutions that work in the new world of work – increasing employee engagement and business results. Below is an example of the work we did for Arla, a global dairy company with 19,000 employees across 6 regions.
80% of time spent on performance management is spent on administration rather than development and coaching
Arla’s management recognised the need to re-think their approach to performance management. Their current process was deemed cumbersome and time-consuming by managers and employees, and their annual KPI process was resource intensive, not to mention unable to keep up with the fast changes in market conditions, milk prices and technology.
They wanted to develop a new approach to performance that would actually drive engagement and performance in its diverse employee pool across this complex organisation with operations across different cultures and geographies.
Working closely with managers and employee representatives from different parts of the organisation, we developed a new performance management solution designed to drive performance, engagement and collaboration. It combines real-time goal setting with continuous feedback and development, and puts the employee, not the organisation or HR, at the heart of the experience.
The solution comes to life in a simple and intuitive app that interfaces with SuccessFactors, enabling a much more employee-centric and efficient user experience, as well as avoiding expensive IT investments.
Our approach combined the latest research on employee behaviour and motivation with Design thinking, as well as tailoring to the client’s context, strategy and culture. Our team identified user needs and behaviours, developed of and tested out a concept model, and developed of an early prototype of an app that seamlessly integrated all employee HR processes into a ‘one stop shop’. The prototype is currently being piloted.
Due to the employee-centric design methodology and approach, the prototype already has many fans in the organisation and has been called ‘the most innovative happening in Arla this year!’ Envisioned benefits, once implemented, will be increased transparency, engagement and performance and a reduction of time by more than 60% in relation to goal-setting and year-end processes.