The balancing act of People Performance Management

Research report on the effectiveness of People Performance Management

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EY - The balancing act of People Performance Management

Over the last century, organizations tried to improve their People Performance Management system, by shifting the focus from a “control” purpose to a “development” purpose and back.

Currently, many PPM systems focus on the development of employees. This leads to changes that include the removal of ratings and/or rankings as part of the appraisal and an increased focus on development in more frequent conversations.

Even though different theories support these interventions, managers and employees are still frustrated with the system, while its effectiveness is debatable.

Organizations view the “control” and “development” purposes as a mutually exclusive choice, when they should rather focus on striking a balance between organizational and individual needs.

“Perhaps steering based on results and developing people at the same time is difficult to combine. I want to appraise someone on a job well done, not on utilization.”

In sports, there seems to be a natural balance between control and development. Athletes have frequent conversations with their coach, trainer and/or team to keep improving their skills. Here, feedback and KPIs are used as means to measure progress rather than to ultimately appraise the athletes.

For most athletes, the continuous improvement and development of their skills – and not the gold medal – is their reward. We found that athletes generally have a strong intrinsic motivation. This enables them to dedicate a big part of their life to reaching the top. We think that organization and individual performance could greatly benefit from the application of these lessons.

“You can develop a lot of skills, but especially the drive, the intrinsic motivation and discipline, making hard agreements with yourself, that is something people in sports can do very well.”
Pieter van den Hoogenband – Swimmer

In this report, we argue that organizations should similarly consider all elements of their PPM system and align them in a true balancing act. The concept of Performance Activation (PA), can be used to find this balance.

Instead of calling it People Performance Management, which implies that employees need to be “managed,” the term Performance Activation highlights the empowerment of the employee. The PA framework details a balance between the organizational (control) and individual (development) needs within people performance.

In order to make the step toward Performance Activation, all elements of people performance should be aligned and balanced between organizational and individual needs.


Download the report here