Conventional performance management systems received negative reviews at a recent Legitimate Leadership client-consultant workshop in Johannesburg entitled Reinventing Performance Management. Comment on traditional systems was that they were often seen as a form of control and punishment – and occasionally reward.
One delegate described them as “the single most disengaging factor that employers use”.
Also, often conventional systems were “played” to get the required good scores.
Yet in the choice between software systems and more labour-intensive performance management approaches, software systems are generally preferred. This is probably because of two factors. Firstly, software is frequently sold as a silver bullet (but experience shows that this is unrealistic – that any success can only come from putting new behaviours in place). Secondly, legitimate leadership of any kind generally involves hard work and the courage to hold people accountable – and the turkey seldom votes for Christmas.
To remedy the negatives of conventional performance management systems, there was agreement among many delegates that the focus needed to shift to “forward-looking contribution”. Most of all, any system which would result in all employees trusting and contributing to it, should be sought.
The Legitimate Leadership Model is not about systems, said Wendy Lambourne, director of Legitimate Leadership. It is rather about cultivating relationships of trust. So no particular system should stop the application of the Legitimate Leadership Model in an organisation. Nonetheless, a performance management system which is aligned to Legitimate Leadership principles obviously is likely to work better.
A case study of one company, Singular Systems, which used the Legitimate Leadership Model in reinventing its performance management system, was described at the workshop – see Singular Systems: Reinventing Its Performance Management System. Following the reinvention, Singular Systems Cape Town achieved increased revenue growth year-on-year due, among other things, to focus on growing staff and driving individual contribution, said Dave Elliott, and executive of Singular Systems.
Said Lambourne: “Every organization is different and you absolutely cannot have a one-size-fits-all approach. Legitimate Leadership has no silver bullet for all performance management systems. It accepts that they will differ from company to company, in different geographies and different environments.”
Almost every company has a performance management system of some kind – often very informal.
Whatever pre-existing system there is, it can be tweaked and changed to align with the Legitimate Leadership Model. Or the system can be scrapped and one can start again.
Ian Munro, director of Legitimate Leadership, said the willingness to give or contribute unconditionally is enabled by the three Ps: purpose, passion and person.
One of the deepest differences between Legitimate Leadership and more conventional leadership approaches is that it calls for the focus on the financial scoreboard (results) to be lessened in favour of focus on the contributions of the people in the organisation. Put differently, Legitimate Leadership is asking for a shift from the results themselves to the people in the organisation who actually cause the results in the first place.
Said Munro: “The scoreboard doesn’t tell you what the contribution is – you can only know what it is by watching the game.”
“Sticks and carrots are not the solution because in essence both are about what can be got from people. In contrast, Legitimate Leadership is about empowering people – what we can give to people and how enabling people makes them stronger.
“The defects of traditional performance management systems are usually addressed through one or more of the following: 1) increasing transparency, 2) decreasing subjectivity, 3) moving from discrete reviews to continuous performance management, and 4) performance standardisation (bell curves). Most performance management systems that we have come across aim to deliver on at least a couple, or occasionally all, of these.
“The problem with all four is that none of them deals with the two core problems plaguing performance management in most organisations: mistrust and backwards-focus. None deals explicitly with mistrust (getting someone to believe you because you made everything transparent is not the same as getting them to trust you). Only continuous performance management (potentially) deals with the backwards-focus problem.
“In designing a performance management system, it is much more effective to focus on developing trusting relationships, than developing the perfect system. None of the trends – improving transparency, decreasing subjectivity, holding a continuous focus, and standardising across the business – are bad ideas in themselves. In fact, we think they are good ideas. We’re simply saying that without a commensurate improvement in trust, and a willingness to look forwards rather than backwards, they simply won’t deliver the improvement that organisations desire. The response to calling on trust will depend on the level of social capital in the relationship.
“Unless you have a trust-based relationship it doesn’t matter what your system is, it will always disempower people. Essentially the Legitimate Leadership Model, and the essence of trustworthiness, is ‘I trust you to the extent that I believe that you have my best interests at heart’.”