Employees give low marks to performance management

PERFORMANCE MANAGEMENT

Employees give low marks to performance management

A survey by Mercer Human Resource Consulting in the US has shown that most employees do not believe that performance management programmes are working properly.

Just a third of the 2,600 employees surveyed by Mercer say they had a formal performance review in the last year. The consensus among these employees is that performance management programmes are not performing optimally. Three-quarters of employees said that they receive little in the way of coaching, and nearly the same proportion questioned the connection between their performance and their pay.

High rating

Staff gave their employers' programmes the highest marks in five areas:

• "I have clearly defined performance goals and objectives" (61% of employees gave a favourable response, either agreeing or strongly agreeing with this statement).
• "I understand how my performance is evaluated" (61% favourable).
• "My last performance review was helpful in identifying actions I could take to improve my performance (55% favourable).
• "Our performance appraisal process adequately distinguishes poor, average and good performance" (55% favourable).
• "When I do a good job, my performance is recognized" (52% favourable).

Low rating

But employees gave performance management programmes the lowest marks in these five areas:

• "My manager regularly coaches me on improving my performance" (26% favourable).
• "When I do a good job, my performance is rewarded" (29% favourable).
• "Employees in my department who perform poorly are appropriately managed" (29% favourable).
• "I have had a formal performance appraisal in the last 12 months" (33% said yes).
• "My manager gives me regular, informal feedback on my performance" (42% favourable).

Connection to commitment and satisfaction

Mercer's survey also asked employees to comment on their overall commitment to their organisation and their overall satisfaction with both their jobs and their organisations. When employee attitudes regarding performance management are interpreted in the context of commitment and satisfaction, some interesting findings emerged:

• Among employees who said they had had a formal performance appraisal in the last 12 months, 62% expressed a strong sense of commitment to their organisation. This compares to 49% for employees who had not had a formal performance appraisal during the past 12 months.
• Among employees who are coached by their manager, 80% feel a strong sense of commitment to the organisation, compared to 46% among those who are not coached.
• Among employees who say they have clearly defined performance goals, only 18% are seriously thinking about leaving their organisation, while among their counterparts without clearly defined goals, 46% are thinking of leaving. Likewise, employees who do not understand how their performance is evaluated are more likely to be thinking about leaving (18% versus 41%).
• Among employees who say good performance is recognised, 81% express overall satisfaction with their organisation, compared to 37% for those who say good performance is not recognised. Similarly, employees who say good performance is rewarded express higher satisfaction than employees who say good performance is not rewarded (88% versus 47%).

Rod Fralicx, global employee research director for Mercer, said: "If ever employers needed a compelling reason to pay close attention to their performance management programmes, this is it."

"Effective performance management has a strong connection to employee commitment, satisfaction, and engagement, which, in turn, can affect important business outcomes such as turnover and productivity."

Want to know more?

Title: People at Work Survey, Mercer Human resource Consulting.

Methodology: Mercer asked a "scientifically valid" sample of 2,600 US workers across more than 1,100 employers to share their attitudes and perceptions regarding their job, organisation, work environment, compensation, benefits, and the management of their organisation. Of the 180-plus questions in the survey, about a dozen looked specifically at performance management practices and programmes.

Availability: Copies of the report are available from Mercer Client Services, tel: +41 22 869 3000, or email: client.services.geneva@mercer.com

Mercer Human Resource Consulting is a global firm that "helps organisations create business value through their people". It employs more than 13,000 employees in some 40 countries serving clients worldwide. To find out more visit www.mercerhr.com

Posted 26 February 2003