Some of the world’s top professional services companies are phasing out traditional performance reviews and staff rankings. For many years these were central to how these companies managed their staff, decided on promotions and bonuses.
“Performance is an ongoing activity, everyday… any business, corporate interaction is more fluid… people want to know: am I doing right, am I moving in the right direction, am I progressing? It’s all about instant performance management.”
Pierre Nanterme, Accenture CEO,
“We, are in need of something nimbler, real-time, and more individualized—something squarely focused on fueling performance in the future rather than assessing it in the past.”
Markus Buckingham and Ashley Goodall – director of leader development at Deloitte
Companies have spent hundreds of thousands or even millions of dollars on traditional talent management systems. Despite this, fewer than 5% of the professional services firms TeamFit has spoken with can truly claim that they know the skills in their internal talent pools. Think how much less these firms know about the skills of their on-demand contingent workforce or of their extended partner ecosystems.
The key themes
There are some common themes from Accenture and Deloitte: performance data has to be for the individual, real-time and future (progress) oriented.
It is about the individual (and not just the company)
A common complaint I hear about performance reviews is that the exercise is all about the company and the company’s objectives.
Am I able to meet the metrics that the company deems valuable; what is my product, technical, and business knowledge as it relates to the company; have I been able to demonstrate my contribution to the firm; what certifications do I hold which are of value to the business?
I have been on both sides of the performance review game. In order for real benefits to occur, the discussion around objectives and aspirations have to be for sides and they also need to come together. As an individual, I have my own set of objectives.
How am I progressing and growing in my career? I’d like to do more projects with these colleagues because I can learn from them. I need to acquire skills in new areas so that I have future options available. I want to be able to contribute value and be recognized and compensated accordingly. How will my colleagues and the firm help me in reaching my goals?
We are all individuals and each of our career paths is by nature unique. Performance reviews are just as much reviews of the company as there are of the individual.
Skills data in real time
As part of a start-up, our team is constantly adapting to new challenges and pushing the envelope on our skills. We learn new things everyday and apply our existing skills to new projects in new ways all the time. An annual, or even quarterly, review process, one outside the context of actual work, will never catch the rich flow of our skills and how they are developing.
At a professional services firm quality of delivery is strongly correlated to the skills of the team (see “The critical questions for service-based organizations leaders”). To successfully lead, one has to have information about the actual skills of your team at your fingertips.
Even real-time skills data is not enough. You have to be thinking about the skills you and your company are going to need. One way to think about this is using the famous Growth Share Matrix developed by Bruce Henderson, founder of the Boston Consulting Group (BCG).
For a professional services company the investments need to be in skills, the skills that will drive differentiation and let you turn some of your Question Marks into Stars. You should be able to answer the following questions for each quadrant.
Of course, you can only do this if you know what skills you are using in your company and where they are being applied. TeamFit is provides the way to do this.
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