Performance Management - Personal Development Plan

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8 Performance Management and Employee Development

One of the tests of leadership is the ability to recognize a problem before it becomes an emergena;.

- Arnold H. Glasow

Learning Objectives By t he end of this cha pter, you will be able to do t he following: 1. Design your own personal developmental plan that ad·

dresses how you can continually learn and grow in the next year, how you can do better in the future. how you can avoid performance problems faced in the past. and where you are now and where you would like to be in terms of your ca reer path.

2. Formulate a developmental plan so you can improve your own reflective, communicative, and behavioral ca reer competencies.

3. Prepa re a developmental plan that includes professional development needs, resources/support needed, and a ti meline for meeting each need with the goals of improving performance in current position, sustaining performance in current position. preparing employees for advancement . and enriching the employee's work experience.

4. Produce a development plan that includes a range of activities (e.g .. on-the-job training, courses. self-guided studying, mentoring. attending a conference or trade show. mixing with the best. job rotation. getting a degree).

5. Propose a developmental plan that highlights the key role of the supervisor as a guide and facilitator of the devel- opmental process (e.g., explaining what is required of the employee to reach a required performance level. referring to appropriate developmental activiti es. reviewing and making suggestions about developmental objectives).

6. Implement a multisource (i.e .. supervisors. peers. self, di- rect reports. customers) feedback system with the goal of providing feedback on and improving performance.

7. Implement multisource feedback systems t hat takes ad- vantage of all of its benefits (e.g .• increased awareness of expectations. improved performance, reduced " undis- cussables" and defensiveness).

8. Implement multisource feedback systems that minimize potential risks and pitfalls (e.g .• could hurt employees' feel· ings. individuals may feel uncomfortable with the system and believe they will not be rated honesHy and treated fairly, is un· likely to work well in organizations that have highly hierarchical cultures that do not support open and honest feedback).

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Part I of this text described strategic and macro-organizational issues in designing a performance management system. Part II described operational and technical details on how to roll out and implement the system. As is mentioned throughout this book, employee development is a key result of state-of-the-science performance management systems. Accordingly, Part III incl udes two chapters dealing with developmental issues and pertains to two key stakeholders in the developmental process: (1) the employees of the organization, who are improving their own performance, and (2) the managers (i.e., performance management leaders), who g uide and facilita te the process of employee development for their direct reports so that it can successfully occur. Development planning is a joint activity entered into by both the employee and the manager. This chapter addresses how to use a performance management system to help employees develop and improve their performance. Chapter 9 add resses the leadership skills needed by managers so that they can best manage the performance of their employees. Let us begin this chapter by discussing personal developmental plans.

8-1 PERSONAL DEVELOPMENT PLANS Personal development plans specify courses of action to be taken to improve performance. Also, achieving the goals stated in the development plan allows employees to keep abreast of changes in their field or profession. Such plans highlight an employee's strengths and the areas in need of development, and they provide an action plan to improve in areas of weaknesses and further develop areas of strength.1 In a nutshell, personal development plans allow employees to answer the following questions:

• How can I continually learn and grow in the next year? • How can I do better in the future? • How can I avoid performance problems faced in the past? • Where am I now and where would I like to be in terms of m y career path?

Development plans can be created for every job, ranging from entry level to the executive suite (e.g., CEO, CFO). No matter how high up the position within the organization and how simple or complex the nature of the job in q uestion, there is always room for improvement. Information to be used in designing development plans comes from the appraisal form. Specifically, a development plan can be designed based on each of the performance dimensions evaluated . For example, if the performance dimension "communication" is rated as substandard, this area would be included in the development plan.

Development plans focus on the short term and on specific roles and positions, but also on the knowledge and skills needed for more long-term career aspirations and career development. Specifically, good development plans also focus on developing career competencies, includ ing the following three sets of competencies2:

• Reflective career competencies . Being aware of one's career and combining personal reflections with one's professional career. The two competencies that comprise this dimension are reflection on motivation, which refers to reflecting on values, passions, and motivations with regard to one's career; and reflection on qualities, which refers to reflection on strengths, shortcomings, and skills with regard to one's career.

Chapt er 8 Performance Management and Employee Development 227

• Communicative career competencies . Being able to effectively communicate with o thers to improve one's chances of career success. The two competencies are networking, which refers to the awareness of the presence and professional value of one's network, and the ability to expand this network for career-related purposes; and self-profiling, which refers to presenting and communicating one's personal knowledge, abilities, and s kills to individuals inside and outside the organization.

• Behavioral career competencies. Being able to shape one's career by taking action and being proactive. The two specific competencies are work exploration, which refers to actively exploring and searching for work-related and career-related opportunities inside and outside the organization, and career control, which refers to actively influencing learning processes and work processes related to one's career by setting goals and planning how to reach these goals.

Now, pause for a few minutes and give yourself some time to think about the three aforementioned sets of career competencies. Where do you stand regarding reflective, communicative, and behavioral career competencies? What are your s trongest and your weakest competencies? Which ones should you be working on to improve your future career prospects?

In addition to improved short-term performance and career path clarity, the inclusion of development plans, and in more general terms, the identification of employee strengths and weaknesses as part of the performance management system have another important benefit: employees are more likely to be satisfied w ith the performance management system.3 For example, a study including 137 employees a t a production equipment facility in the southern United States showed that the greater the extent to which employees believed that the system was being used for development purposes, the more satisfied they were with the system. On the contrary, perceptions of the extent to which the system was

Box 8-1

Company Spotlight: Individual Development Plans at General Mills At General M ills, individual development plans (l OPs) are promote the process for employees by host ing speakers, promoted strongly throughout the company. The Minneapolis, offering Web-based learning tools, and holding workshops Minnesota-based General Mills is an international foods for employees and managers t o get the most out of the company. Some of the best-known brands include Annie's process. Some of these sessions are specifically ta ilored Homegrown, Betty Crocker, Yoplait, Colombo, Totino's, to d ifferent k inds of posit i ons within t he company w ith Pillsbury, Old El Paso, Haagen-Dazs, Cheeri os, Tri x, Cocoa d ifferent needs in the development process. Also, the IDP is Puffs, and Lucky Charms. The formally written lOPs are kept separate f rom t he annual performance appraisal, as the completed annually, but the expectati on is for ongoing beli ef is that development planning cannot be suffi cient ly conversatio ns wit h managers and empl oyees, f ocusing addressed in the context of appraisal. In summary, General not only on competencies t hat are well devel oped and M ills provides an example of a company that has made those that are in need of improvement, but also on the a strong commitment to the growth and learning of all employee's career aspirations. The company's IDP sessions employees.•

228 Part Ill Employee and Leadership Development

used for evaluative purposes did not relate to employee satisfaction with the system. In other words, using the system for evaluative purposes d id not relate to employee satisfaction, but using the system for development purposes had a positive relationship with satisfaction. This is precisely the reason why so many companies, such as the The Gap, Ely Lilly, Microsoft, and Accenture, emphasize that their performance management systems have a strong focus on employee development. Box 8-1 describes how development plans, including short- and long-term objectives, are implemented at General Mills.

Finally, another important aspect of personal development plans is that they allow organizations to gather information that can be used for succession planning purposes.5 For example, based on individual career aspirations, an organization is able to identify employees who may be interested and able to serve in leadership positions in the future. Many "high-potential" programs are essentially based on combining employees' current performance and future aspirations with the organization's future talent needs. Thus, development plans serve an important strategic role in helping an organization address fu ture possible talent gaps.

8·1·1 Development Plan Objectives The overall objective of a development plan is to encourage continuous learning, performance improvement, and personal growth. In addition, development plans have other, more specific objectives:

• Improve performance in a1"ent position. A good development plan helps employees meet performance standards. Thus, a development plan includes suggested courses of action to address each of the performance dimensions that are deficient. This is an important point, given that surveys have shown that about 25 percent of federal employees and between 11 percent and 16 percent of private sector employees in the United States are not performing up to standards.6

• Sustain perjom1nnce in current position .. A good development plan provides tools so that employees can continue to meet and exceed expectations regarding their current position. Thus, the plan includes suggestions about how to continue to meet and exceed expectations for each of the performance dimensions included in the appraisal form.

• Prepare employees for advancement. A good development plan includes ad vice and courses of action that should be taken so that employees will be able to take advantage of future opportunities and career advancement. For example, a good p lan indicates which new competencies should be learned to help with career ad vancement.

• Enrich the employee's work experience. Even if career opportunities within the organization are not readily available, a good plan provides employees with growth opportunities and opportunities to Jearn new skills. These opportunities provide employees with intrinsic rewards and a more challenging work experience, even if the new skills learned are not a formal part of their jobs.7 Such opportunities can make jobs more attractive and serve as a powerful employee retention tool. In addition, the new skills can be useful in case of lateral transfers within the organization.

As an illustration, consider the employee development plan used for staff a t Texas A&M University in College Station, Texas. Because the development plan

Chapter 8 Performance Management and Employee Development 229

is a forma l component of the university's performance management system, the development plan is included within the appraisal form. The appraisal form used by Texas A&M first lists the six objectives of the performance management system:

1. Provide employees with feedback to improve or maintain job performance.

2. Outline areas for employee development. 3. Set standards for the next review period. 4. Recognize job-related accomplishments. 5. Enhance communication and working relationships. 6. Identify job performance deficiencies (any factor "Does Not Meet

Expectations") and report to the next level of supervisory responsibility.

Based on objective 2, the employee development plan is an important component of the performance management system. The inclusion of this objective upfront sets the tone for the development process by helping managers understand that this is an important issue.

After the sections in the form in which the manager rates employee performance, the following material is included:

i Please list professional development activities to be completed and resources needed to support these activities, if appl icable

Professional Develop ment Needs

Resourc.es/Su pport Needed Time f rame

The inclusion of this information after performance ratings allows the manager and employee to focus on developmental areas identified as weaknesses in the performance review process. In this way, the development plans created for e mployees at Texas A&M are directly related to performance dimensions important for the unit and the overall organization. In addition, including the development plan a t the end of the review and after setting annual performance goals allows the employee to determine whether there are areas he o r she needs to develop in order to a ttain the specified goals.

8·1·2 Content of Development Plan Wha t does a developmental plan look like? Plans should include a description of specific steps to be taken and specific objectives to reach. In other words, what is the new skill or knowledge that w ill be acquired and how will this occur? This includes information on the resources and strategies that will be used to achieve

230 Part Ill Employee and Leadership Development

the objectives. For example, will the employee Jearn the skill from a cowor ker th rough on-th e-job training? Will the company reimb urse the employee for expenses associated w ith taking an online course?

The plan's objectives should include not only the end produ ct, such as the new s kill to be learned , but also, th e completion date and w hat evidence will be gathered to know w h ether the new skill h as indeed been acquired. For example, in the case of an online course, the objective could state that it w ill be completed b y July 23, 2019, and th e employee is expected to receive a grad e of B+ or better. Overall, objectives included in the development plans should be practical, specific, time-oriented, linked to a standard, and developed jointly by the supervisor and the employee.

An a dditional important feature of d evelopment plans is that it should keep the needs of both the organization and the em p loyee in mind. As mentioned earlier, state-of-the-science developm ent p lans are used strategically to connect th e organization's future talen t needs with an employee's performance and aspirations. The choice of what specific skills or performance areas will be improved is influenced by the needs of the organization , especially w h en the organization is investing substantial resources in the plan. In a dd ition, the plan created is influenced by the needs of the employee. The supervisor and the employee need to agree on what development or new skills will help enrich the employee's work experience, as well as help accomplish organizational goals now or in the near future.

As an example, Jet us consider once again the con tent of the development p lan a t Texas A&M. First, employees a re directed to a website that includes examples of possib le developmental activities. This list includ es worksh ops; certifications; local, state, and national conferences; on-the-job training; and other activities. This information p resents employees and managers with various options th ey can use to ach ieve the d evelopmental objectives. Second, the form includes space so that each professional developm ental need is paired with a d escription of resources o r support needed and a time frame for completion. For example, the developmental plan for an administra tive assistant in the business school may look like this:

SECTION B: PROFESSIONAL DEVE LO PMENT PLAN

Please list profess ional development activities to be completed and resources needed to support these activit ies, if appl icable

P rofessional Develop ment R esources/Supp ort Needed Time fra me Needs

I. Knowledge of Excel Reimbursement for online Course to be completed by (spreadsheet program) course August I, 2019

2. Customer service ski lls in Reimbursement for one-day Workshop to be completed dealing with students and workshop. Time to receive by October 15, 2019. fac ulty on-the-job training from On-the-job training to be

administrative assistant in completed by November communications department 8,2019

Chapter 8 Performance Management and Employee Development 231

Overall, the Texas A&M p lan includes all of the required components . There is a description of developmental objectives, activities that will be conducted to reach these objectives, and dates of completion. One important piece seems to be missing, however. The p lan does not include specifics of how the accomplishment of each objective will be measured. Specifically, how will the s upervisor know if the administrative assis tant has a good work- ing knowledge of Excel after he has completed the online course? How will the s upervisor know if the administrative assistant's customer service skills have improved after he has attended the workshop and has undergone on- the-job training? Excel proficiency could be measured by the administrative assistant's performance in the course or by examining answers to questions abo ut knowledge of Excel that faculty, and others giving Excel assignments to the administrative assistant, answer in filling out appraisal forms. Regarding customer service skills, the accomplishment of the objective might be measured by gathering data from those customers served by the administrative assistant (i.e., faculty and s tudents).

8-1-3 Developmental Activities C learly, developmental activities are dependent on an organization's strategic goals and objectives, and also, on resources that may or may not be available. For example, on-the-job training is more likely to take place in s mall, compared to large organizations, which ma y have a training and development unit, or have s ufficient resources to offer in-house courses, or pay for an employee to take a course at a local university. There are several ways through which employees can reach the objectives s ta ted in their development p lans, including:

• On-the-job training. Employees are paired with a peer or supervisor who designs a formal on-the-job training course. The design of these "mini-training programs" includes how many hours a day or week training will take place and specific learning objectives.

• Courses. Some large organizations, such as McDonald's, Motorola, Capgemini, Ernst & Young, and others, offer in-house courses given at their own corporate universities. Other organizations may provide tuition reimbursement. Given the proliferation of online courses, there is a wide variety of options from which to choose.

• Self-guided studying. Employees can read books, watch video presentations, and study other materials on their own. Once again, it is important that an objective be set regarding what will be read and within what time frame, as well as what measure(s) will be used to assess whether learning has taken place.

• Mentoring. Many organizations have mentoring programs. In general terms, mentoring is a developmental process that consists of a one-on-one relationship between a senior (mentor) and junior (protege) employee. For such programs to be s uccessful, it is best to allow the mento r and protege to choose each other, rather than arbitrarily assigning who will be mentoring w hom. In general, mentors serve as role models and teach proteges what it takes to succeed in the organization. In more specific terms, mentors can help proteges gain targeted skills.

232 Part Ill Employee and Leadership Development

• Attending a conference or trade show. Another way to acquire required knowledge and skills is to sponsor an employee's attendance a t a conference or trade show. It is useful to require that the employee provide a written report and deliver a brief presentation upon returning from the conference. In this way, it is easier to assess what has been learned, and in addition, the knowledge gained can be shared with other organizational members. As is true for most developmental activities, they have to be directly linked to an employee's development plan and also an organization's needs. This principle clearly applies to attending off-site conferences and trade shows, given that this developmental activity is particularly prone to abuse.8

• Mixing with the best. A developmental activity particularly targeting entrepreneurs and high-level executives involves the "Genius Network," a by-application-only network whose participants pay $100,000 to a ttend three meetings a year. This network connects high-achieving entrepreneurs, industry innovators, and best-selling authors and their goal is to help them grow their business tenfold.9

• Getting a degree. Some organizations provide tuition reimbursem ent benefits fo r their employees to obtain additional degrees or certifications. For example, the organization can sponsor an employee's MBA program or an employee's taking specialized co urses with the goal of earning a certification designation (e.g., Certified Novell Administrator, Professional in Human Resources). In most cases, em ployees commit to continuing the relationship with their employer for a prespecified amount of time after completing the degree. If the employee leaves the organization before this time frame, she may have to reimburse the organization for the cost of her ed ucation. As an example, the firm Boston Consulting Group (BCG) sponsors "BCG MBA Fellows," w hich is a scholarship program that includes not only a tuition reimbursement, but also ind ividual mentorship by senior BCG consultants. To be eligible for this program, a BCG employee m ust work for the company for at least two years, and then, be enrolled in a full-time MBA program approved by BCG. This is a developmental activity that serves an important strategic p urpose for BCG because it helps build a talent pool needed for its succession planning needs, given that it has more than 80 offices in 48 countries and more than 14,000 employees.

• Job rotation. Another way to gain necessary skills is to be assigned to a different job on a temporary basis. This is the model followed in the medical profession in which residents have to rotate across specialty areas for several months (e.g., OB-GYN, psychiatry, pediatrics). For example, residents may be required to rotate across the various emergency medicine services for a 19-month period.

• Temporary assignments. A less systematic rotation system includes the opportunity to work on a challenging temporary assignment. This allows employees to gain specific skills within a limited time frame.

• Membership or leadership role in professional, trade, or nonprofit organizations. Some employers sponsor membership in professional, trade, or nonprofit organizations. Such an organization distributes publications to its members and holds informal and formal meetings in w hich employees have an opportunity to Jearn about best practices and other useful information for

Chapter 8 Performance Management and Employee Development 233

On-the-job training

Courses

Self-guided studying

Mentoring

Attend1ng a conference or trade show

Mixing with the best

Getting a degree

Job rotation

Temporary assignments

Membership or leadership role in professional, trade, or nonprofit organizations

their jobs. For example, this could include the Society for Human Resource Management, Chartered Institute of Personnel and Development for Human Resources (HR) Professionals or the Australian Human Resources Institute. Also, presentation, communication, planning, and other skills can be learned while serving in a leadership role in a volunteer organization outside of work (e.g., local charity, church, or synagogue).

Table 8-1 includes a summarized list of developmental activities that may be available to achieve goals included in a development plan. Based on your own preferences and learning style, which of these activities do you believe would be most beneficial to you? Please rank these activities in terms of your preference. Does the organization yo u work for now, or worked for most recently, offer any of these opportunities? If not, to what extent is this a factor that would motivate you to look for a job elsewhere, where more of these developmental activities would be made available to you?

An example of a development plan is included in Figure 8-L The development plan can be part of the appraisal form, or it can be included in a separate form. The form included in Figure 8-1 shows that employees have several choices in terms of developmenta l activities. Note that the form includes space so that information can be inserted regarding what activities will take place when, what the objectives are, and whether the objective has been met or not.

Many of the activities listed above are relevant for employees a t all levels. However, some, such as the "mixing with the bes t" activity, pertain specifically to high-level managers. In fact, the issue of managerial development is very important on its own because it is directly related to s uccession planning- as discussed earlier. For example, employees who aspire to secure managerial positions should evaluate all developmental activities to understand which ones would be most beneficial to achieve this particular career goal. 10

Consider your future career expectations and developmental needs. Then, fill out the form included in Figure 8-1, assuming your current or future employer will be willing to provide any developmental opportunities of your choosing. What does your plan look like? What did you discover about what yo u would like to Jearn in the future? What does this information tell yo u about your level of aspirations and fu ture prospects for your career advancement?

TABLE 8 -1 Summary List o f Development Activities

234 Part Ill Employee and Leadership Development

FIGURE 8 -1 Example of a Development Plan Form

Update Date: Name: Job TiUe/Job Code: Department Prima1y Reviewer: Education: Prior Training: Job History: Career Goals:

Next !year Next 2 years Next 3years Next 5 years

OptionsOJT ... ,I (on-the-job) Type of Training Development

Classes Current Quarter

Conferences

On-line

Self-study

Job rotation Next Quarter

Videos

Books

Temporary assignment

Mentorship Current +£

Other (specify)

II Current +il.

I I Completed I Hours Comments- How (ThiS Approximate Objectives/

When Long Quarter) Cost-Other Evaluation

8-2 DIRECT SUPERVISOR'S ROLE The direct superv isor has an important role in the creation and comple- tion of the employee's development plan. Because of the pivotal role of the direct supervisor in the employee development process, it is a good idea for the superv isor to have her own development plan a s well . This will help the s upervisor understand the process from the employee's perspective, anticipate potential road blocks and defens ive attitudes, and create a plan in a collaborative fashion. n

Chapt er 8 Performance Management and Employee Development 2315

In terms of the specific role of the supervisor, consider the following five ftmctions:

1. explaining what is required of the employee to reach a required performance level

2. referring to appropriate developmental activities 3. reviewing and making suggestions about developmental objectives 4. checking on the employee's progress toward developmenta l objective

achievement 5. offering the opportunity for regular check-ins and reinforcing positive

behaviors

Let us d iscuss each of these functions in tum. First, the supervisor needs to explain what would be required for the employee to achieve the desired performance level, including the steps that an employee must take to improve her performance. This information needs to be provided togeth er with information on the probability of success if the employee completes the suggested steps. A good tool that supervisors can use to accomplish this goal is to use the feedforward interview (FFD. The goal of the FFI is to understand the types of behaviors and s kills that individuals have that a llow them to perform well, and to think about ways to use these same behaviors and skills in other contexts to make further improvements in the fu ture. The FFI includes a meeting between the s upervisor and employee and involves the following three steps12:

1. Eliciting a success story. The s upervisor sets the stage as follows: "All of us have both negative and positive experiences at work. I would like to meet w ith you to discuss some positives aspects only and see how we can Jearn from those experiences about things that work well." Then, the supervisor can ask, "Could you p lease tell me a story about an event or experience a t work during which you felt at your best, full of life and in flow, and you were content even before the results of your actions were known?" It is important that the story be very specific about an actual incident and not a general statement about "In general, these are the things I do at work .... " So, the story must be situated w ithin a specific context. After the s upervisor hears the story, she can summarize it for the employee to hear it, and then, the s upervisor can ask whether any information is missing or anything else should be added to the story. A follow -up question is, "Would you be happy to experience a similar process again?" If the answer is in the affirmative, then the s ubsequent questions attempt to go deeper into the details of the story. If the story is associated with mixed feelings and is not completely positive, then a different story must be elicited.

2. Uncover the underlying success factors . The second step involves understanding the factors that Jed to the successful story. For example, the supervisor can ask, "What were some of the things you did or did not d o, s uch as your specific personal strengths and capabilities, that made this success story possible?" and "Wha t were the conditions that made this success story possible?" It is important to uncover both the personal and contextual factors that Jed to the success s tory. This step is similar to cond ucting d etective work to try to understand the various factors

2315 Part Ill Employee and Leadership Development

that Jed to success, includ ing the role that the work environment (e.g., technology) and o thers (e.g., customers, peers) played in the story.

3. Extrapolating the past into the future. The third step involves asking questions that will lead to an employee's ability to replicate the conditions that Jed to success in the past into the fu ture. So, the supervisor can first note that "The conditions you have just described seem to be your personal code for reaching [insert the key achievement in the story such as happiness at work, optimal performance, outstanding leadership, etc.]." Then, follow up with questions such as, "Think about your current actions, priorities, and plans for the near future (e.g., next week, month, or quarter) and tell me how you think you may be able to replicate these conditions to be able to achieve the same level of [insert satisfaction, achievement, performance, etc.] as you d id before."

An experiment involving all 25 managers in the sales and customer service units of a business equipment firm in Canada provided evidence regard ing the effectiveness of the FFI. 13 The managers and their direct reports were randomly assigned to one of two experimental cond itions (a) feedforward interview (n = 13 managers, 70 employees), or (2) traditional feedback (n = 12 managers, 75 employees). Results showed that compared to traditional feedback, the FFI increased performance four months later. So, the effects of the FFI are relatively enduring. Also, the training required to teach managers how to use the FFI is fairly short. In this particular experiment, it took just two-and-a-half hours to train 13 managers, which helped shift the role of the manager from a judge or critic of an employee' s past performance to apprecia tive inquiry of what an employee will do in the future.

As an outcome of the FFI, there may be resources that the employee may need to achieve his developmental goals. Thus, as a second important function, the supervisor has a primary role in referring to appropriate developmental activities that can assist the employee in achieving her goals. For example, this includes helping the employee select a mentor, appropriate study resources, courses, and so forth .

Third, the supervisor reviews and makes suggestions about the developmental objectives. Specifically, the supervisor helps assure the goals are achievable, specific, and doable (recall our discussion about goals in Chap ter 5) .

Fourth, the sup ervisor has primary responsib ility for checking on the employee's progress toward achieving the developmental goals. For example, the supervisor can remind the employee of due dates and revise goals, if needed.

Finally, in addition to regular check-ins, the supervisor need s to provide reinforcements so the employee will be motivated to achieve the developmental goals. Reinforcements can be extrinsic and include rewards such as bonuses and additional benefits, but reinforcements can also include the assignment of more challenging and interesting work that takes advantage of the new skills learned .

To be successful in performing the five aforementioned func tions, supervisors themselves need to be motivated to support the employees' completion of their developmental objectives. For this to happen, s upervisors must be held accountable and rewarded for doing a good job in helping their employees de- velop. 14 Consider how this is done a t KLA-Tencor Corporation, one of the world's top 10 developers and manufacturers of inspection and measurement equipment for the semiconductor and nanoeletronics ind ustries. KLA-Tencor is a global

Chapt er 8 Performance Management and Employee Development 237

company including 6,000 people in 17 countries, united by a "culture that rewards innovation and recognizes the power of collaboration to deliver breakthroughs." At KLA-Tencor, between 10 percent and 30 percent of supervisors' bonus pay is directly tied to employee development, which is measured in terms of employee training and certification levels. Managers are given at least quarterly updates on the status of their s taff development. In addition, employees themselves are rewarded for engaging in developmental activities. In fact, only employees with up-to-date trairting and certification levels are eligible for bonuses. Thus, employee development is successful a t KLA-Tencor because both employees and managers are directly rewarded for employee development. After several years of implementing these practices, employee development has become the norm and is part of the KLA-Tencor's culture. 15 As an additional example specifically regarding the role of supervisors in implementing the development plan, Jearn how this is done at Diageo, as described in Box 8-2.

In sum, direct supervisors play a key role in the success of the development plan because they are directly involved in the assessment of objective accomplishment and monitor progress toward accomplishing developmental objectives. Also, they must be highly committed to the development of their employees and motivated to help their employees fulfill their career aspirations. To do so, supervisors must be evaluated, in part, based on how well they manage the developmental process for their employees. When these conditions are present, the development plan becomes an integral part of the performance management system, all employees have a plan (including managers from all levels in the organization), all employees are able to access different types of developmental opportunities on an ongoing basis, and alignment between employee and organizational goals is enhanced.16

Box 8 -2

Company Spotlight: Role of Direct Supervisor in Development at Diageo Diageo makes and distributes alcoholic beverages that devel opment goals that are aligned with the employee's include brands such as Smirnoff (the worl d's best-sell ing career aspirations. Monthly meetings, referred to as "call vodka), Johnnie Walker (the world's best-sell ing bl ended overs," are hel d to review progress toward goa ls and Scotch whisky), Baileys (the world's best-selling liqueur), to adjust goal s as necessary. Also, t he supervisor helps and Guinness (the world's best-sell ing stout). Also, Diageo provid e a mea ns for development and reach ing goa ls owns 34 percent of Moet Hennessy, whi ch owns brands by ensuring employees receive t raining, course work, or including Moet & Chandan, Veuve Clicquot, and Hennessy. studying mat erial on relevant topics. Another strategy Di ageo sells its products in more than 180 countries and has incl udes g iving assignments outsi de of one's current po- offices in about 80 countries. The company has recogni zed sition responsibilities, such as leading a project, to test the va lue of empl oyee development and expects supervi- one's skills and practice what the employee has learned sors to play an important role in the development of their in the devel opment process. In summary, Diageo has d irect reports. Specifically, the company's career devel op- recognized the critical role t hat managers shou ld play ment program includes a formal review and goal setting, in the employee devel opment process. Th i s involvement along with regular meetings to keep development fresh benefits the individua l employee's g rowth and al so aids in the minds of empl oyees. The supervisor faci litates the in ali gning employee skills and acti ons with the strategi c process in several ways. The supervisor helps identify specific goal s of the o rganizati on as a whole."

238 Part Ill Employee and Leadership Development

Next, we address an important tool used for employee development purposes: multisource feedback systems. Although these systems are called using different labels, such as 360-degree systems, multi-rater, multisource, full circle, or 450 feedback, the basic principle is the same: We gather the most useful information about employee's development needs when we use multiple sources of performance information.18

8-3 MULTISOURCE FEEDBACK SYSTEMS The multisource feedback system has become a preferred tool for helping employees, particularly those in supervisory roles, improve performance by gathering information on their performance from different sources.19 As mentioned above, multisource feedback systems are usually called "360-degree" systems because information is gathered from sources all around the employee. Specifically, information on what performance dimensions could be improved is gathered from superiors, peers, customers, and direct reports. This information is usually collected anonymously to minimize rating inflation. Employees also rate themselves on the various performance dimensions and compare self-perceptions with the information provided by others. A gap analysis is conducted to examine the areas for which there are large discrepancies between self-perceptions and the perceptions of others. A multisource feedback system report usually includes information on dimensions for which there is agreement that further development is needed. This information is used to create a development p lan, as described earlier in the chapter.

A multisource feedback system is most helpful when it is used for developmental purposes only and not for administrative purposes.20 This is because people are more likely to be honest if they know the information will be used to help individuals improve and not to punish or to reward them. However, it is possible to implement such systems successfully for administrative f.urposes after they have been in p lace for some time-usually, two years or so. 1

Feedback reports usually include graphs showing the areas in which employees' perceptions differ the most from the perceptions of other sources of performance data. They can also show average scores, across sources of information, so that the areas that need improvement are readily identified . The result ing report is usually mad e available to the employee and his supervisor so that both have an opportunity to review it before meeting to create a development plan.

A trend adopted by many vend ors that offer online multisource feedback systems is to offer a bundle of systems, includ ing multisource feedback together with learning management, compensation, and even recruiting and succession planning.22 These integrative applications, usually called "talent management" systems, allow to manage data abou t employees in a systematic and coordinated way. Such integrative software applications allow organizations to create an inventory of their human capital and better understand their strengths and weaknesses at the organizational level. For example, an organization that uses such applications is quickly able to deploy project teams with the appropriate mix of skills and experience after doing a quick search in the database. Another important advan tage of these integrative applications is that performance management can be more easily linked to recruiting, compensation, training, and succession planning. In other words, the system can keep track of an employee's developmental needs and how these needs have been ad dressed (e.g., via training) over time.

Chapt er 8 Performance Management and Employee Development 239

As an illustration, consider a system offered by Profiles International, called CheckPoint 360. This system, designed for em ployees in supervisory roles, in- cludes information on the following competencies:

• Communication (listens to others, processes inform ation, communicates effectively)

• Leadership (instills trust, provides direction, delegates responsibility) • Adap tability (adjusts to circumstances, thinks creatively) • Relationships (builds personal relationships, facilitates team s uccess) • Task management (works efficiently, works competently) • Production (takes action, achieves results) • Development of others (cultivates individ ual talent, motivates

s uccessfully) • Personal d evelopment (displays commitment, seeks improvement)

The CheckPoint 360 system includes self-evaluations as well as evaluations provided by the direct supervisor, d irect reports, and peers. After performance information has been collected from all these sources, the manager evaluated re- ceives feed back in the form of the graph shown in Figure 8-2. This graph illustrates the discrepancies between self- and others' ratings as well as the scores obtained for each compe tency. For example, this graph shows tha t this particular manager has the g reatest gap for the competency "development of others." Specifically, the manager assigned a score of abo ut 4.5 to herself, whereas the average score p rovided by her direct s upervisor, direct reports, a nd peers is only 2.55. The CheckPoint system uses the following scale to rate competencies:

Not Applicable (not averaged into scores)

Never demonstrate s this

Seldom demonstrates this

Sometimes demonstrates this

Usually demonstrates th1s

Always demonstrates this

In this particular illustration, the manager believes that she displays behaviors indicating the competency " development of others" somewhere between "usually" and "always." By contrast, her s upervisor (i.e., "boss"), employees, and peers believe that she dem onstra tes these behaviors somewhere between "seldom" and "sometimes." In other words, the self-rating falls within the favorable zone whereas the ra tings provided by others do not.

To explore this gap further, the report provided to the manager also includes more detailed information on the scores provided by each source of information. The Reference Group Comparison chart included in Figure 8-3 shows this informa tion. An examination of the scores p rovided for the competency "development of others" indicates that all sources, except for the manager herself, agree that work is needed regarding this competency because all scores are between the "seldom" and "sometimes" categories. By contrast, the manager believes she is doing an exceptional job of cultivating individual talent (score of 5) and motivating successfully (score of 4).

240 Part Ill Employee and Leadership Development

FIGURE 8-2 Checkpoint 360-degree Competency System: Executive OveNiew. © Profiles International, Inc., Waco, Texas, USA

Executive Overview Overview of Self vs. All Observers

Total CheckPoint Scores N«

Colorll.cy: O &tf 4-GfV+: All Obtl'r.ffib} I p(llll Wlll(lf'i'.

Differential 0.34

Source Bob Strategic Busin ess Partner of Profiles Internatio na l, lnc. SQS.634--7748, [email protected]. com, h ttp://v.rww.ga.telyoonsulting.oom/chkpointhtm. Courtesy of Profiles In ternationa l, Inc.

Chapter 8 PerFormance Management and Employee Development 241

Reference Group Comparison with Management Alignment of Self and Boss

StiiiSm I I Ptrforman« A111lysis low

I ..... ' ·-Conmtunication Listens To O!hers

Processes Information

Communicates

Leadership lustUI.s T mst

Provides Direction

Delegates Re:,ponsibility

Adaptahilitv Adjlists to Circumstances

Thinks

Relationshill!! Builds Personal Relationships

FaciliwJes Team

Task Management Works Ejjicielllly

Work.t Compelently

Production Takes Action

Acbif!l.Y!S Resulls

Development Of Others Culthtllf!S bu/i,•idutd Talents

.IIJotivGies Succes.sfu/Jy

Personal Development Commifmenr

Seeks lmprovemem

Total CheckPoint Scores I , ..

• • Sdf Qu. C)l'ftN

Source: Bob Strategic Business Partner of Profiles International, Inc. 508-634--7748, bob®gate:lyconsulting. com, http://www.gate:lyoonsulting.com/ chkpoinlhtm. Courtesy of Profiles international, Inc.

FIGURE 8-3 Checkpoint 360-degree Competency System: Reference Group Comparison. © Profiles International, Inc., Waco. Texas, USA

242 Part Ill Employee and Leadership Development

FIGURE 8-4 Checkpoint 360-d egree Competency System: Deve lop me nt Summary. © Prof1les In ternational, Inc., Waco, Texas, U SA

It is not sufficient, however, just to provide scores regarding each of the competencies. Becoming aware that there is a problem with a competency is a very good firs t step, but a good multisource feedback system also provides concrete suggestions about what to do to improve competencies.24 The CheckPoint system does this by providing what is called a development summary. The development summary describes strengths and areas that should be developed further. An example of this is shown in Figure 8-4. According to the graph, this

Development Summary for Darcy Walker

SkiiiS.t

Strengths A consensus of youneference gmup Jatings shows these competencies are clear strengths. as they fall in or above the Favornble Zone.

1.'1 Oisploys Commilmcnt Works Competentl y

Achieves Takes J.\ction Bu1lds Personal Relationships Works Efficiently II Adjusts to Circumstances Instills T•·ust Listens To Others

Development Areas A consensus of yourreference gmup Jatings shows these competencies (which faiJ below the Favornble Zone) as in need of improvement and should be considered a lop pliotity foryou.rcat-eerdevelopment.

Thinks Creatively 1iJ Communicates EITecth·ely

Facilitates Team Succe.ss II Information m Seeks lmprO\'tment Motivates Cultivates Individual Talents m PrO\'ides Direction

Delegates Rt"Sponsibility

Critical Devetopme1n Area!

Critical Developme.Jlt Area!

Critical Development Area! Critical Development Area!

The critical development areas ate deteonined by input from Boss and Self and the telalionship of the Favornble Zone.

,1,.

All Obs<rvtrs Rating

• , ....

' , ....

' , .... Source-: Bob Strateg ic Business Partne r of Profi les Internationa l, lnc. SQS.634--7748, bob@ga. telyoonsulting .com, http://' "'"vw.gatelyconsulting.oom/ chkpoint.htm. Co urtesy of Profi les Internationa l, lnc.

Chapt er 8 Performance Management and Employee Development 243

particular manager has several strengths, but also, some areas that deserve further development. For example, there is a need to work on the "facilitates team success" dimension of the competency "relationships." The report also includes specific suggestions on how to improve this competency, which are shown in Figure 8-5. Specifically, the manager is given tips and advice regarding concrete steps to be taken to improve performance. For example, in terms of learning to collaborate on team decisions, the manager is given advice about how to compromise and reach win-win decisions and how to gain support for decisions.

Suggestions for Improvement tor Darcy Walker

following suggestions will help direct your development efforts:

Facilitates Team Success

• Don't ignore conflict. thinking it will disappear. 11 won't. And don't expect a conflict-free workplace. Some discord is inevitable and constructively dealing with it will create a more productive work environment.

• Listen carefully to all viewpoints in a disagreement. Define the problem. Tiren begin tlte process of resolution.

• Explore multiple options. Tiren resolve with solutions that are acceptable to all involved parties.

• When recognizing outstanding perfonnance, go beyond the acknowledgment of individual successes. Give equal emphasis to team achlevernents and effective cooperntion among learns.

• Validate the importance of each and eve!)' team member's contribution.

• Prnctice tlte art of compromise when making decisions. creating win/win situations. • To gain support fordecis ions. involve the team in considering altemative approaches. Strive for

consensus in orderto increase commitment to O•e final decision.

ESS>lishT Elm Obju tive.

• As much as possible involve the team in fonnu lating goals consistent with. and supportive of. tlre overnll mission of your business. Also solicit input when planning the implementation of the goals.

• Make sure evel)'one under:stands tlte team's goals, as well as tlreirrole in attaining the goals. • Keep evel)'One apprised of team progress.

D& Eiqt Gro.p Dynmics Thai:BrirgO<.tttEII.S:inEva-ya-e

• Recruit individuals witlr talents tlrat will complement tire skills of otlrertearn member:s. • Capitalize on each per:son's strengths and experiences to create a potent team effort.

Souru: Bob Strategic Business Partner of Profiles international, Inc. 508-634--7748, bob®gate:lyconsulting .com, http://v.rww.gatelyoonsulting.oom/chkpoinlhtm. Courtesy of Profiles International, Inc.

FIGURE 8-5 Checkpoint 360-degree Competency System: Suggestions for Improvement. ©Profiles International, Inc., Waco. Texas, USA

244 Part Ill Employee and Leadership Development

8-3-1 Benefits of Multisource Feedback Systems Organizations and individuals can gain several ad vantages as a consequence of implementing a multisource feedback system. These include the following:

• Decreased possibilif:lJ of biases. Because these systems include information from more than one source, there is a decreased possibility of biases in the identification of employees' weaknesses.

• Increased awareness of expectations. Employees become aware of others' expectations about their performance. This includes not only the s upervisor's expectations, but also, the expectations of other managers, peers, direct reports, and customers.

• Increased commitment to improve. By using multisource feedback systems, information about performance is no longer a private matter. Thus, employees become aware of what others think about their performance, which increases their commitment to improve in the future.

• Improved self-perceptions of performance. Employees' distorted views of their own performance are likely to change as a result of the feedback received from other sources. In other words, it is difficult to continue to have distorted views of one's own performance in the presence of overwhelming evidence that these perceptions may not be correct.

• Improved perfonnance. Although receiving information about one's performance is not sufficient cause to improve, it is certainly a very important s tep. Thus, having information on one's performance, if paired with a good development plan, is likely to lead to performance improvement.

• Reduced "undiscussables" and defensiveness. Multisource feedback systems provide an excellent opportunity for coworkers, s uperiors, and direct reports to give information about performance in an anonymous and nonthreatening way. Many supervisors may feel uncomfortable about providing negative feedback and some issues become "tmdiscussables." But a multisource system makes providing such feedback easier. Also, from the perspective of employees, it is harder to ignore and become defensive regarding the accuracy of performance feedback w hen it originates from multiple sources.25

• Employees enabled to take control of their careers. By receiving detailed and constructive feed back on weaknesses and strengths in various areas, employees can gain a realistic assessment of w here they TABLE 8 ·2 should go with their careers. Summary Ust of Benefits Resulting From a Table 8-2 includes a summa-

rized list of benefits that organiza- tions can obtain from implementing a multiso urce feedback system. Consider an organization for which you have worked that has imple- mented a multisource feedback system. If you carmot think of one, talk to friends or family members and ask them about a system they

Multisou rce Feedback System

Decreased possibility of biases

Increased awareness of expectations

Increased comm1tmentto improve

Improved self-perceptions of performance

Improved performance

Reduced · undiscussables'' and defensiveness

Employees enabled to take control of tihelf careers

Chapter 8 Performance Management and Employee Development 245

have experienced. Then, consider the list of benefits listed in Table 8-2. Which of these were not actually realized by the system? Why not?

8-3-2 Risks, Contingencies, and Potential Pitfalls in Implementing Multisource Feedback Systems

We have discussed the many advantages of multisource feedback systems, but we should also consider that there are some risks and potential pitfalls involved.26 For example, negative feedback can hurt an employee's feelings, particularly if those giving the feedback do not offer their comments in a constructive way. Second, the system is likely to lead to positive res ults only if individuals feel comfortable with the system and believe they will be rated honestly and treated fairly. User acceptance is an important determinant of the system's success. Third, when very few raters are providing the information, say, two or three, it may be easy for the employee being rated to identify who the raters are. When anonymity is compromised, raters are more likely to distort the information they provide. Fourth, raters may become overloaded with forms to fill o ut because they need to provide information on so many individuals (peers, superiors, and direct reports). Finally, implementing a multisource feedback system sho uld not be a one-time-only event. The system should be in place and data collected over time on an ongoing basis. The implementation of ongoing multisource feedback systems is sometimes labeled a 720-degree feedback Sljstem, referring to the fact that the collection of multisource data takes place at least twice. In short, admirtistering the system only once will not be as beneficial as administering the system repeatedly.

In addition, we need to be cognizant that multisource feedback systems are not necessarily beneficial for all individuals and all organizations. For example, individuals who are high on self-efficacy (i.e., they believe they can perform any task) are more likely to improve their performance based on feedback received from peers compared to individuals low on self-efficacy.27 Also, the effect of receiving feedback from multiple sources is most beneficial for individuals who perceive there is a need to change their behavior, react positively to feedback, believe change is feasible, set appropriate goals to improve their performance, and take concrete actions that lead to performance improvement.28 On the other hand, individuals who score lower on self-efficacy pay more attention to the feedback received from their line managers. In other words, an employee's confidence in her own performance influences which sources of fee dback are most useful to her.

In terms of organizational characteristics, multisource systems work best in organizations that have cultures that support open and honest feedback. Also, these systems work best in organizations that have a participatory, as opposed to authoritarian, leadership style in which giving and receiving feedback is the norm and is regarded as valuable. For example, consider the case of the Patent Office of the United Kingdom. This organization is characterized by a hierarchical structure, typical of many civil service organizations, as opposed to a fla t structure, where employees are involved and teamwork is the norm. The implementation of a multisource feedback system did not lead to the anticipated positive results, and there was a mismatch of expectations between w hat the board members wanted (i.e., better working relations and a culture change) and what

24S Part Ill Employee and Leadership Development

the employees wanted (i.e., individual improvement). Moreover, managers did not show a good understanding of the behaviors they were expected to display, and their performance did not show improvement. Overall, the multisource feedback system was not sufficiently linked to o ther HR systems and policies.29

Answering the following questions can give a good indication as to whether implementing a multisource system would be beneficial in a specific organization:

1. Are decisions that are made about rewards and promotion fairly free of favoritism?

2. Are decisions made that take into account the input of people affected by such decisions?

3. Do people from across departments usually cooperate with each other and help each other?

4. Is there little or no fear of speaking up? 5. Do people believe that their peers and direct reports can provide valuable

information about their performance? 6. Are employees trusted to get the job done? 7. Do people want to improve their performance?

In short, the successful implementation of a multisource feedback system is heavily d ependent on the culture of the organization and the work context.30 If the answer to most of these questions is "yes," the implementation of a multisource feed back system is likely to be successful and lead to performance improvement.

The risks associated with implementing a multisource system can be illustrated by Watson Wyatt's Human Capital Index (HCI)3 1 This is an ongoing stud y of the effects of HR practices on the stock value of more than 700 publicly trad ed companies. One particular result was especially alarming. Of the companies surveyed, those that had implemented multisource feedback had lower stock value! Specifically, the companies that used peer reviews had 4.9 percent lower market value than did similar companies that did not implement peer reviews. Furthermore, companies that implemented upward feedback, where employees rated managers, had a 5.7 percent lower stock value than did similar companies that did not implem ent upward feedback. Does this necessarily m ean that implementing multisource feedback systems causes the stock price to decrease? Based on the data collected, there is no d efinitive answer to this question. It could be that organizations that are not performing well financially decide to implement multisource feedback systems precisely to help improve their performance. Nevertheless, these results highlight the importance of following best practices in implementing multisource feedback systems to avoid any negative con- sequences of implementing such a system, which we ad dress next.

8·3·3 Characteristics of a Good Multisou rce Feed back System Fortunately, there are several things that can be done to maximize the chance that the system will work properly. When systems have the following characteristics, they are most likely to be successfuJ32:

• AnonymihJ In good systems, feedbac k is anonymous and confid ential. When such is the case, raters are more likely to provide honest information regarding performance, particularly when direct reports are providing information about superiors.

Chapt er 8 Performance Management and Employee Development 247

• Observation of employee perfonnance. Only those with good knowledge and firsthand experience with the person being rated should participate in the process. There is no point in asking for performance feedback from people who are not able to observe performance directly.

• Feedback interpretation. Good systems allow the person being rated to d iscuss the feedback received with those genuinely interested in the employee's development. In most cases, feedback is discussed with the d irect supervisor. In other cases, the discussion can involve a representative of the H R department, a superior, or peer to w hom the person does not report directl y.

• Follow-up. The information gathered has little value if there is no follow-up action. Once feedback is received, it is essential that a development plan is created right away.

• Used for developmental purposes only (at least initially). When multisource fee d back systems are used for adminis trative p urposes such as p romotions and compensation, raters a re likely to d istort the information provided. Make it clear that the purpose of the system is developmental, and developmental only. Ini tially, the information collected sho uld not be used for making reward allocations or any o ther administrative decisions. However, the syste m may be used fo r administrative purposes after it has been in place fo r some time- approximately, two years or so.

• Avoidance of rater fatigue. Rater fatigue can be avoided if individuals a re not asked to rate too many people at the sam e time. For exam ple, data collection can be staggered so that not all surveys are distributed a t the same time.

• Emphasis on behaviors. Altho ugh systems can include feedback on both behaviors (com petencies) and res ul ts, it is better to e mphasize behaviors. Focusing on behaviors can lead to the identification of concrete actions that the person being rated can take to improve performance.

• Raters go beyond ratings. In addition to providing scores on the various dimensions, raters should provide written descriptive feedback that gives detailed and constructive comments on how to improve performance.33 It is helpful if this information also includes specific examples that help s upport the ratings and recommendations provided.

• Raters are trained. As in the case of provid ing eval uations for ad ministrative p urposes, raters should be trained. Mainly, this incl udes s kills to discriminate good from poor performance and how to provide feedback in a constructive manner.

Table 8-3 includes a summ arized list of characteristics of good multisource feedback systems. Given this list, consider the case of AAH Pharmaceuticals, described in Box 8-3. Based on this information, which characteristics are present? Which are absent?

In closing, this chapter referred to the important role of supervisors in the employee development process. But for managers to become true "performance management leaders," they require specific knowledge and skills. This is the topic that we will address in Chapter 9.

248 Part Ill Employee and Leadership Development

TABLE 8-3 Characteristics of a Good Multlsource Feedback System

Box 8 -3

Anonymity

Obse,vation of employee performance

Feedback Interpretation

Follow-up

Used for developmental purposes only (at least initially)

Avoidance of rater fa tigue

Emphasts on behaViors

Raters go beyond ratings

Raters are trained

Company Spotlight: Multisource Feedback at AAH Pharmaceuticals AAH Pharmaceuticals (AAH) utilizes a multisource feedback several sources through an automated online system of system that incl udes several characteristics of a good system. quest i onnaires, ensuring that inf ormation was anonymous The company, which has nine depots around t he United and confidential. After the results were obtained, participants Kingdom, including locations in Belfast, Glasgow, and Sussex, attended a one-day meeting about the results away f rom is a wholesaler of pharmaceuticals, providing medical products the office that included one-on-one interpretation and d is- and services in the UK. AAH, with the help of professional cussion w ith the consultant to initiate a development plan. consultants, f ound the multisource feedback process helpful Six-month follow-up meetings were held to review progress in providing feed back and useful information for develop- toward developmental obj ectives. AAH found the process ment planning. To help ease employee concern, the company to be successful w ith a f irst g roup of managers who went clearly outlined for employees that development planning through the process and made plans for a broad rollout of and f eedback were t he on ly purposes, and information the program for more employees to take advantage of de- would not be used for any other purpose. Employees were velopmental opportunities. In summary, the system utilized also given the option of sharing information w ith supervi- by AAH provides an example of several of the characteristics sors. The system included gathering performance data f rom of a successful multisource feedback instrument.34

SUMMARY POINTS

• Personal developmental plans are a key component of a performance management system because they specify courses of action to be taken to improve performance. A performance management system that Jacks information about how to improve performance will not help employees Jearn skills beyond what they know and use already. In a nutshell, a good development plan allows employees to answer the following four questions: How can I continually Jearn and grow in the next year? How can I do better in the future? How can I avoid performance problems faced

Chapt er 8 Pe rformance Management and Employee Development 24e

in the past? Where am I now and w here would I like to be in terms of my career path?

• Development plans focus on both the short term and the long term. Specifically, development plans address how to improve performance in the current position, how to sustain good levels of performance in the cu rrent position, and how to prepare employees for future ad vancement. In addition, development plans provide employees with growth opportunities so that even if advancement within the organization is not clear, employees are able to enrich their daily work experiences. In terms of the future, good development plans also help employees build th ree types of career competencies: reflective (i.e., refl ection on motivation, reflection on qualities), communication (i.e., networking and self-profiling), and behavioral (i.e., work explora tion and career control). A long-term orientation is also important fo r organizations because it allows them to use development plans strategically and to gather information usehtl for succession planning.

• Good development plans include a description of the specific s teps to be taken and specific developmental objectives . A good plan includes information about (1) developmental objectives, (2) how the new s kills or knowledge will be acqu ired, (3) a time line regarding the acquisition of the new skills o r knowledge, and (4) standards and measures tha t will be used to assess w hether the objectives have been ach ieved. Learning objectives should be designed s tra tegically to take into account both the needs of the individual and those of the organization.

• Developmental objectives can be achieved by one or more of the following activities (1) on-the-job training, (2) courses, (3) self-guided stu dying, (4) men to ring, (5) attending a conference or trade show, (6) mixing with the best, (7) getting a degree, (8) job rotation, (9) tem porary assignments, and (10) membership or leadership role in professional, trade, or nonprofit o rganizations. Developmental activities for specific objectives are chosen by the employee and the d irect supervisor. This choice is guided by taking into account the employee's learning preferences, the developmental objective in q uestion, and the organization's available resources. Many of these activities are suited fo r all positions, but some are particularly suited for managerial jobs (e.g., mixing with the best) .

• The d irect supervisor has a key role in helping the employee define the scope of the development plan and in explaining the relationship between the developmental objectives and strategic priorities for the unit and the organization. The direct s upervisor also has direct responsibility for checking on the em ployee's progress toward achieving the developmental objectives and provid ing resources so that the employee will be able to engage in the appropriate activities (e.g., courses, mentoring) . Also, supervisors can help employees uncover the factors that lead to achievement and job satisfaction by cond ucting feedforward interviews, whose goal is to understand the types of behaviors and s kills that individ uals have that allow them to perform well and to think abo ut ways to use these same behaviors and s kills in other contexts to m ake further improvements in the future. Supervisors must reinforce an employee's accom plishments toward completing a development p lan so that the employee remains m otivated. Fina lly, supervisors themselves must be m otivated to perform all these

2110 Part Ill Employee and Leadership Development

functions in support of their employees' development p lans. To do so, supervisors' performance regarding how well they help their employees develop should be measured and rewarded appropriately. In short, the supervisory role includes the following five functions (1) explaining what is required of the employee to reach a required performance level, (2) referring to appropriate developmental activities, (3) reviewing and making suggestions about d evelopmental objectives, (4) checking on the employee's progress toward developmental objective achievement, and (5) offering the opportunity for regular check-ins and reinforcing positive behaviors.

• Multisource feed back systems are tools that help employees build new skills and improve their performance in general by gathering and analyzing performance information from several sources, including peers, superiors, direct reports, and oneself. Performance information gathered from oneself is compared to information gathered by other sources to perform a gap analysis showing discrepancies between how one sees one's own performance in relation to how o thers see one's performance. These types of systems are also used to identify performance dimensions for which all, or most, performance information sources agree there is little or substantial room for improvement. Accordingly, this information can be used in creating a development plan.

• The implementation of multisource feedback systems can produce many benefits, including (1} decreased possibility of biases, (2) increased awareness of performance expectations, (3) increased commitment to improve, (4) improved self-perceptions of performance, (5) improved performance, (6) reduction of undiscussables and defensiveness, and (7) increased career control on the part of employees.

• In spite of the many advantages associated with implementing multisource feedback systems, there are some risks involved . For example, negative feedback can hurt an employee's feelings; ind ividuals may not be read y to receive such feedback and may therefore not participate willingly; anonymity may be compromised, and therefore, information may be distorted ; and raters may be overloaded with forms to fill out. These risks, and the associated failure of the system, are particularly high when the organization does not value participation in decision making; there is little cooperation among employees; there is favoritism; employees do not value the opinion of others (i.e., peers, direct reports); decisions are based on hearsay; and/or employees are not trusted to get the job done.

• There are some characteristics that will enhance the success rate of a multisource feedback system. These features include the following: there is anonymity; raters have firsthand knowledge of the performance of the person being evaluated; feedback is interpreted by a person genuinely interested in the development of the person evaluated; there is follow-up after receiving feedback; the system is used for development purposes only; raters do not become fatigued; there is an emphasis on behaviors, instead of on results; raters provid e information beyond performance ratings only; and raters are trained. The presence of these characteristics is likely to lead to the successful design and implementation of the system.

Chapter 8 PerFormance Management and Employee Development 2151

EXERCISE 8-1 MAKING THE CASE FOR A TOP-NOTCH MULTISOURCE FEEDBACK SYSTEM DEMO

You are in charge of selecting a multisource feed back system that will be purchased b y the organization for which you work for or have most recently worked for. First, you need to make sure the system has as many of the ideal characteristics as possible as described in this chapter. Second , you need to select a system that will be particularly s uitable to your organization's culture and goals, ind ustry context, as well as resource constraints.

As a firs t s tep, do a Google search for "360-d egree" and "multisource" feedbac k system demos. For example, one such demo is availab le at h ttps:// www.hr-survey.com/360FeedbackDemos.htm. Second, critically rev iew a few of the demos, taking into account their positive and less positive features. Third, select a good system and prepare a 5-10 minute presentation to be delivered to the rest of the class, describing the reasons you selected the system you did. Keep in mind that you need to describe, at a minimum, what the good features o f the system are and why this system is appropria te for your particular organization.

EXERCISE 8-2 OBTAINING MULTISOURCE FEEDBACK ON YOUR OWN PERFORMANCE

The goal in this exercise is to conduct a multisource feedb ack system regard ing your performance in this class. First, create a list of competencies that are related to the performance of a s t udent taking a performance management course (hint: see Figure 8-2). Second, create a rating form including these competencies (hint: see Figure 8-3) . Third, fill out the form and also give the same form to a t least three other classmates. After you collect th e forms, create a list of strengths and development areas (hint: see Figures 8-4 and 8-5). Finally, sched ule individual meetings with each of the classmates who filled out the forms to discuss areas in which there was d isagreement. What were those areas? What are the reasons for disagreements across raters? Also, what are your strengths? What are your areas in need of development and what specific actions would you take to address each?

CASE STUDY 8-1

Content of a Personal Development Plan at Brainstorm, Inc.

Cathy is a sales manager at Brainstorm, Inc., a computer software training company that sells Microsoft, Novell, Corel, and Open Office training software, located in Lehi, Utah. One of Ca thy's responsibilities is to complete annual performance evaluations with all of her direct reports and create

Performance Appraisal Form

individual development plans for th ese employees, based on their performance eval uations. Recently, Jay, an inside sales representative and Cathy's direct report, finished his first year's performance evaluation w ith Cathy. Cathy's performance evalu ation of Jay's key competencies and key results is as follows:

Key Competencies Supervisor Comments Score

Sales and Marketing: Demonstrate knowledge of pnnciples and methods for showtng, promoting. and selling products or seNices.

Customer and Personal Service: Knowledge of principles and processes for providing high-quality customer and personal services.

Interpersonal Communication: Talking to others to convey informat1on effectJvely as well as giv1ng full attention to what other people are say1ng, taking time to understand the points being made, and asking questions as appropriate.

Persuasion and N egotiation: Persuading others to change their minds or behavior. Bringing others together and t;ying to reconcile differences.

Problem Sensitivity and Ethics: The ability to tell When something is wrong or is likely to go wrong. ethically or otheiW1se. It does not involve solving the problem, only recognizing there is a problem.

Could be more proficient w1th greater product knowledge. Needs greater understanding of the benefitS of each of the products.

Good verbal and sales skills most of the time. Had a couple occasions when customers felt like they weren't getting enough personal assistance with recently purchased products.

Very good. Always enthusiastic w1th customers and quickly develops a good rapport with new customers.

Adequate. but could be more direct and persuasive With customers.

Excellent. Shown great ability to anticipate if contract negotiat1ons are taking an unethical or unprofitable turn for the worse.

B-

B+

A-

Key Results Supervisor Comments Score

Degree to which employee met monthly sales goals ($50,000 In sales revenue a month):

Degree to which employee met referral goals (10 referrals a month):

Number of cold calls made monthly (2 50):

Place yourself in Cathy's shoes, and use the above performance evaluation to develop an individual

2152

Adequate. Met sales goals 66 percent of the time 1n the last six months.

Needs improvement. Met referral goals 50 percent of the time in the last six months.

Excellent. Tlfeiessly exhibits persistence and hard work in reaching out to businesses.

B-

development p lan for Jay (Hint: use information included in Section 8-1 Personal Development Plans).

CASE STUDY 8-2

Improving a Personal Dev elopment Plan at Brainstorm, Inc.-Part II

Joe, o ne of the Partners of Brains torm, Inc., has been looking into development plans as a pos-s ible wa y of increas ing the productiv ity and morale of the co mpany's sales force. To help him in this project, Cathy has adapted a development plan form from a business magazine she has recently seen and as ks you for feedback. Since Cathy is unfamiliar w ith the characteristics of good development plans, s he is particularly interested in your critique of a development plan that s he developed for a sales representative, Jay. Note: Brainstorm, Inc., may not be

Brainstorm , Inc., Development Plan

Updated: June 28, 2019

Name: Jay

Job Title/Job Code: Sales Representative

Department: Sales

Developmental Options OJT (On·the·job training) Courses SeiF·guided studying Mentoring Attending a conFerence or trade show Mixing with the best Getting a degree Temporary assignments

able to finance much in the way of outs ide learning; however, the company could provide some paid time off and may be able to negotiate some better rates for attending classes or conferences, based on various indus try memberships.

1. How would you improve and/or change the following form and its content?

2. Because there are only six employees in the company, how would you adapt the form to meet the needs of this small business? Provide an example.

Membership or leadership role (proFessional, trade, non· profit organizations) Other (speciFy)

Description Type or Development When How Long Completed Hours (this Quarter) Comments-Approximate Cost-Other Objectives/ Evaluation

Current Quarter

Next Quarter

(Cononuedj

2113

2114 Pa rt Ill Employee and Leadership Development

Primary Reviewer: Cathy

Education: High school graduate

Prior Training: Bachelor's degree in Sales and Marketing

Job History: 10 years of experience in sales. Two years of experience in software training sales.

Career Goals:

Next1 year

Next2 years

Next3 years

Next 5 years-Become head of sales and lead sales trainer.

ENDNOTES

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5. Ch urch, A. H., Rotolo, C. T., Ginther, N. M., & Levine, R. (2015). How are top companies designing and managing their high-potential programs? A follow-up talent managem ent benchm ark study. Consulting Psychology Journal: Practice & Research, 67, 17--47.

6. Tyler, K. (2004). One bad apple: Before the whole bu nch spoils, train m anagers to deal with poor performance. HR Magazine, 49(12), 77-86.

7. Parker, S. K., Margeson, F. P., & johns, G. (2017). One h un d red years of work design research: Looking back and looking forward. Journal of Applied Psychology, 102,403--420.

8. Watanabe, T. {2016). UC Berkeley ch ancellor under investigation for alleged misuse of public funds. Los Angeles Times. Retrieved january 2, 2018, from http: //www.latimes.com/local/ education/la-me-ln-berkeley-chan cellor-probe-20160712-snap-story.html

9. Harnish, V. (2017). 5 trends to ride in 2017. Fortune, 175(4), 32. 10. Dragoni, L., Tesluk, P. E., Russell,). A., & Oh, L (2009). Understanding managerial

development: Integrating developmen tal assignments, learning orientation, an d access to developmental opportunities in p redicting managerial competencies. Academy of Managemeut Journal, 52, 731-743.

11. Dunning, D. (2004). T LC a t work: Training, leading, coaching all types for star performance. Palo Alto, CA: Davies-Black.

12. Kluger, A. N., & Nir, D. {2010). The feedfo rward inter view. Human Resource Management Review, 20, 235-246.

13. Bud worth, M., Latham, G. P., & Man roop, L. (2015). Looking forward t o performan ce improvem ent: A field test of the feed forward interview for perform ance management. Human Resource Management, 54,45-54.

14. You ng, S., Gentry, W., & Braddy, P. (2016). Holding leaders accountable during the 360° feedback process. Industrial and Organizational Psychology, 9, 811-813.

15. Ellis, K. {2003). Developing for dollars. Training, 40(5), 34-38. 16. Bracken, D. W., & Rose, D. S. {2011). Wh en does 360-degree feedback create behavior ch ange?

And how would we know it w hen it does? Journal of Business and Psyclwlogy, 26,183-192. 17. Garretson, C. (2005, January). Diageo distills IS Leaders. Nehoork World, 42. 18. Bracken, D., Rose, D., & Church, A. (2016). The evolution and devolution of 360° feedback.

Industrial and Organizational Psyclwlogy, 9, 761-794.

Chapter 8 Performance Management and Employee Development 21515

19. Margeson, F. P., Mumford, T.V., & Campion, M.A. (2005). Coming full circle: Using research and p ractice to address 27 questions about 360-degree feedback programs. Consulting Psychology joumal: Practice and Research, 57, 196-209.

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22. 360 employee feedback from app o n Morf Playbook. (2016). Worldwide Videotex Update, 35(6), 7-8.

23. Frauenheim, E. (2006). Talent management software is bu ndling up. Workforce Management, 85(19), 35.

24. Luthans, F., & Pete rson, S. ). (2003). 36Q-degree feedback with systematic coaching: Em pirical analysis suggests a winning combination. Human Resource Management, 42, 243-256.

25. Campion, M. C., Camp ion, E. D., & Campion, M.A. (2015). Improvements in per form ance m anagement through the use of 360 feedback. Industrial and OrganiZIItional Psychology, 8,85-93.

26. Vukotich, G. (2014). 360° feedback: Ready, fire, aim-Issues with improper implementation. Performance Improvemmt, 53(1), 30-35.

27. Bailey, C., & Austin, M. (2006). 360 degree feedback an d developmental outcomes: The role of feedback characte ristics, self-efficacy and importance of feedback dimensio ns to foca l m anagers' current role. International jouma/ of Selection and Assessmmt, 14,51-66.

28. Smither, J. W., London, M., & ReiJJy, R. R. (2005). Does performan ce improve foJJowing multisource feedback? A theoretical model, me ta-analysis, and review of em pirical findings . Personnel Psychology, 58, 33-66.

29. Morgan, A., Cannan, K., & Cu llinane, J. (2005). 360° feedback: A critical enquiry. Personnel Review, 34, 663-680.

30. Maurer, T. )., Barbeite, F. G., & MitcheJJ, D. R. (2002). Predic tors of attitudes toward a 360-degree feedback system and involvement in post-feedback management developmen t activity. jounza/ of Occupational & Organizational PsyciJOiogy, 75, 87-107.

31. Pfau, B., & Kay, I. (2002). Does 360-degree feedback negatively affect com pan y performance? HR Magazine, 47(6), 54--59.

32. Some of these recommen dations are adapted from DeNisi, A. S., & Kluger, A. N. (2000). Feedback effectiveness: Can 360-degree appraisals be improved? Academy of Management Executive, 14, 129-139; and McCarthy, A. M., & Caravan, T. N. (2001). 360° feedback p rocess: Performance, improvement and employee career de\•elopment. journal of European Industrial Training, 25, 5-32.

33. Kabins, A. (2016). Why the qualms with qualitative? Utilizing qualitative methods in 360° feedback. Industrial and Organizational PsyciJOiogy, 9, 806-810.

34. Town er, N. (2004, February). Turning appraisals 360 degrees. Personnel Today, 18. Retrieved January 2, 2018, from http://www.personneltoday.com/ Art ides/2004/02/17 / 22398/ tuming-appraisals-36Q-degrees.htrnl