Performance Management - From Pain to Gain - Is a 3 CD recording of Jeff Gaines' powerful and
innovative workshop by the same name.
Jeff's approach starts with:
- Eliminating Job Descriptions
- Eliminating Performance Reviews
- Eliminating Performance Based Pay
In this audio you will learn about:
- Performance reviews vs. performance management
- The real source of motivation
- Handling legal issues
- Handling compensation
- How to truly manage performance
To order your copy, contact Jeff Gaines today.
Cost is $150 plus shipping.
innovative workshop by the same name.
Jeff's approach starts with:
- Eliminating Job Descriptions
- Eliminating Performance Reviews
- Eliminating Performance Based Pay
In this audio you will learn about:
- Performance reviews vs. performance management
- The real source of motivation
- Handling legal issues
- Handling compensation
- How to truly manage performance
To order your copy, contact Jeff Gaines today.
Cost is $150 plus shipping.
The following article was written by Jeff Gaines and published in the Professional Insurance
Agents (PIA) monthly newsletter:
Oct. ’05 Magazine
Department: Features Performance management
Performance management—from pain to gain
By Jeff Gaines
Let’s face it, performance reviews can be very unpleasant for both employees and managers. They
don’t improve performance. In fact, if you look at all the time they consume, even if you get an
increase in performance, when balanced out with the investment we actually are loosing ground. So
why do companies do them?
When I ask managers and supervisors why they continue to do them they typically respond,
“Because I have to.” Executives claim they are utilized to give out raises, to document for corporate
standards and to give feedback. Why give feedback, I ask? Well, of course, to improve performance,
which we already have said is not actually happening. But shouldn’t it? Yes. In fact if done properly
feedback can have a great impact on performance. Giving effective feedback during a performance
review is very difficult, because the employee is scared and everyone present knows the process is
really about money and documentation anyway.
Don’t know what to do instead? There is a better way. Start by getting rid of performance reviews,
getting rid of job descriptions and getting rid of performance-based pay.
Performance based pay. Money is a motivator; it’s just a lousy one. What it motivates is attendance.
Once a person has done the minimum necessary to get their paycheck, which in most companies is not
much, money has no effect. Yet many companies use bonuses and incentive plans with the hope of
getting people to work harder. If you get any improvement at all, the results usually are short term and
in many cases these programs actually create problems.
The ideal is for a person to be paid based on what they produce. You get out what you put in. Not
because this would motivate but because it is fair. However, for most positions it is practically
impossible to measure an individual’s true impact on the whole complex organic system that produces
the bottom line. If you can, great, use that for pay. A sales person is an example of a position where it
is very easy to measure what is produced and to base pay on it. Not so easy with a customer service
position.
Come up with a fair and reasonable pay structure. Offer a salary range for each position with different
grades based on non-performance issues such as certifications, tenure, etc. Give profit sharing and
company-wide bonuses as a flat percentage of each person’s base pay. Then get to the business of
motivation with methods that actually work.
Job descriptions and performance reviews. I recommend taking these two antiquated, ineffective
and/or unused tools and morphing them into a single document called a “Definition of Success.” The
purpose of this document is to answer the question, “How will the manager and employee know if
this job is being performed successfully?” In answering this question, we have achieved the main
purpose of a job description, which is to set expectations. The main difference here is productivity,
not activity.
Job descriptions are generally a list of duties. Two main problems with this: 1. it is nearly impossible
to list everything a person needs to do in today’s multi-tasking work environment and 2. gets the
employee thinking that if it is not on the list, then they don’t have to do it. Of course we handle
number two with the ubiquitous, “other duties as assigned,” but that effectively negates the usefulness
of the entire document because they still don’t know what to expect.
A definition of success only lists productivity, not activities, only end results, not behaviors. By
listing the end results as the expectation, the focus for the employee is now on doing whatever it takes
to produce that end result. They can feel as though they have a good understanding of what it takes to
“win” in their job, rather than feeling like their job is to try to keep their head above water. It is much
easier and more realistic to define what they need to produce rather than how they will achieve that. It
is their job to figure out the “how,” it is management’s job to define the “what.”
This document also becomes the coaching tool used in place of a performance review and is discussed
at least quarterly. The main difference being there will be NO subjective measures used. If you can
count the number of transactions processed or something that is in no way judgmental, than use those
numbers, otherwise forgo using ratings.
The fascination with rating systems is similar to the money discussion. Give them a 4 out of 5 and
supposedly they will work harder to get the 5. Of course nobody gets 5’s, but he or she is not
supposed to think about that. The bottom line is rating systems do not motivate, so get rid of them.
Employees need real, honest feedback about their performance AFTER clear expectations have been
established. When the employee knows this conversation will not affect their pay and they no longer
will have to endure a judgmental and very subjective rating system, they will be more open to feedback
and to having a real, open, honest discussion about what is and is not working. And by the way, the
manager is now much more likely to tell them what they really need to hear.
Jeff Gaines is a speaker and consultant in the field of Emotional Intelligence and works with
organizations to incorporate those principles into every aspect of their business. To learn more about
Jeff or to contact him, visit his website at www.JeffGaines.com.
Agents (PIA) monthly newsletter:
Oct. ’05 Magazine
Department: Features Performance management
Performance management—from pain to gain
By Jeff Gaines
Let’s face it, performance reviews can be very unpleasant for both employees and managers. They
don’t improve performance. In fact, if you look at all the time they consume, even if you get an
increase in performance, when balanced out with the investment we actually are loosing ground. So
why do companies do them?
When I ask managers and supervisors why they continue to do them they typically respond,
“Because I have to.” Executives claim they are utilized to give out raises, to document for corporate
standards and to give feedback. Why give feedback, I ask? Well, of course, to improve performance,
which we already have said is not actually happening. But shouldn’t it? Yes. In fact if done properly
feedback can have a great impact on performance. Giving effective feedback during a performance
review is very difficult, because the employee is scared and everyone present knows the process is
really about money and documentation anyway.
Don’t know what to do instead? There is a better way. Start by getting rid of performance reviews,
getting rid of job descriptions and getting rid of performance-based pay.
Performance based pay. Money is a motivator; it’s just a lousy one. What it motivates is attendance.
Once a person has done the minimum necessary to get their paycheck, which in most companies is not
much, money has no effect. Yet many companies use bonuses and incentive plans with the hope of
getting people to work harder. If you get any improvement at all, the results usually are short term and
in many cases these programs actually create problems.
The ideal is for a person to be paid based on what they produce. You get out what you put in. Not
because this would motivate but because it is fair. However, for most positions it is practically
impossible to measure an individual’s true impact on the whole complex organic system that produces
the bottom line. If you can, great, use that for pay. A sales person is an example of a position where it
is very easy to measure what is produced and to base pay on it. Not so easy with a customer service
position.
Come up with a fair and reasonable pay structure. Offer a salary range for each position with different
grades based on non-performance issues such as certifications, tenure, etc. Give profit sharing and
company-wide bonuses as a flat percentage of each person’s base pay. Then get to the business of
motivation with methods that actually work.
Job descriptions and performance reviews. I recommend taking these two antiquated, ineffective
and/or unused tools and morphing them into a single document called a “Definition of Success.” The
purpose of this document is to answer the question, “How will the manager and employee know if
this job is being performed successfully?” In answering this question, we have achieved the main
purpose of a job description, which is to set expectations. The main difference here is productivity,
not activity.
Job descriptions are generally a list of duties. Two main problems with this: 1. it is nearly impossible
to list everything a person needs to do in today’s multi-tasking work environment and 2. gets the
employee thinking that if it is not on the list, then they don’t have to do it. Of course we handle
number two with the ubiquitous, “other duties as assigned,” but that effectively negates the usefulness
of the entire document because they still don’t know what to expect.
A definition of success only lists productivity, not activities, only end results, not behaviors. By
listing the end results as the expectation, the focus for the employee is now on doing whatever it takes
to produce that end result. They can feel as though they have a good understanding of what it takes to
“win” in their job, rather than feeling like their job is to try to keep their head above water. It is much
easier and more realistic to define what they need to produce rather than how they will achieve that. It
is their job to figure out the “how,” it is management’s job to define the “what.”
This document also becomes the coaching tool used in place of a performance review and is discussed
at least quarterly. The main difference being there will be NO subjective measures used. If you can
count the number of transactions processed or something that is in no way judgmental, than use those
numbers, otherwise forgo using ratings.
The fascination with rating systems is similar to the money discussion. Give them a 4 out of 5 and
supposedly they will work harder to get the 5. Of course nobody gets 5’s, but he or she is not
supposed to think about that. The bottom line is rating systems do not motivate, so get rid of them.
Employees need real, honest feedback about their performance AFTER clear expectations have been
established. When the employee knows this conversation will not affect their pay and they no longer
will have to endure a judgmental and very subjective rating system, they will be more open to feedback
and to having a real, open, honest discussion about what is and is not working. And by the way, the
manager is now much more likely to tell them what they really need to hear.
Jeff Gaines is a speaker and consultant in the field of Emotional Intelligence and works with
organizations to incorporate those principles into every aspect of their business. To learn more about
Jeff or to contact him, visit his website at www.JeffGaines.com.
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