Deloitte’s New Performance Management System
Gandhi Heryanto, Management Consultant, Indonesia
Deloitte redesigned their employee performance management system. In Deloitte’s new system there are no cascading objectives, no once-a-year reviews, and no 360-degree-feedback tools. It is a very different and much simpler design for managing people’s performance. Its hallmarks are speed, agility, one-size-fits-one, and constant learning, and it's underpinned by a new way of collecting reliable performance data. This system makes more sense for talent-dependent businesses.
There are 3 objectives of the system:
1. RECOGNISE Each Person’s Performance: To recognise each person performance, particularly through variable compensation.
2. SEE Each Person’s Performance: Here we faced two issues—the idiosyncratic rater effect and the need to streamline our traditional process of evaluation, project rating, consensus meeting, and final rating. To see performance at the individual level, then, we will ask team leaders not about the skills of each team member but about their own future actions with respect to that person.
3. FUEL Each Person’s Performance: Third objective is to fuel performance. Managers conduct regular check-ins with each team member about near-term work. These brief conversations allow leaders to set expectations for the upcoming week, review priorities, comment on recent work, and provide course correction, coaching, or important new information.
How can such individual performance management system be brought in line with the organization performance as a whole?
Source: Reinventing Performance Management, HBR, April 2015