Performance vs. Motivation

Performance appraisals may send messages of mistrust and suppress the human spirit. Instead of depending on the motivation of inspired people, they can reduce employees to quantitative numbers, de-motivating them. Their best efforts cannot be turned on and off like a machine!

While performance appraisals may be used to weed out the bad, they can actually hurt the organization. More than a dozen leading business authors, academics and consultants have condemned and discouraged the use of performance appraisals, including Peter Block, Philip Crosby, Steven Covey, and the late W. Edwards Deming. Covey calls performance reviews by management today as bloodletting. Instead, he urges managers to develop win-win agreements with their employees about performance issues. An unintended result of that suggestion is that some employers do use his proposal of the performance model, but not fully, preparing documentation on an employee’s personal traits, rather than encouraging performance on a personal level with the development of win-win agreements based on trust and communication with management.

Deming encourages all leaders to use spontaneous and unplanned and unhurried three-to four-hour conversations with all employees at least once a year, with the primary goal of listening. These talks would not take the form of criticism, or performance feedback, but emphasis would be on a broader view of the work and to help clarify understanding of what employees need to perform their duties at a high level and to communicate how an employee’s efforts impact the company’s goals.

Alternatives to performance appraisals include these ideas:

1. Give an employee choice in accepting obligation and responsibility so work remains meaningful and effective.

2. Less structure and control over the individual employees often leads to increased motivation and productivity. Employees cannot be motivated to achieve their best results, but the conditions of openness and trust is the intrinsic motivation that unleashes the mind and heart-felt commitment to the objectives of the organization.

3. Concentrating resources in those areas most impacting workforce engagement, organizations will continue to see the return on investment through decreased employee turnover, improved productivity, and increased customer loyalty & retention.

4. Companies can survive and grow only if they are free to develop systems where variation, differentiation and diversity are valued as ways to innovate and improve.

Still Unconvinced About the Power of Employee Engagement? Look at the Data

A recent study of more than 300 organizations by the Aberdeen Group, titled, Beyond Satisfaction: Engaging Employees to Retain Customers, speaks volumes about the power of employee engagement.

Organizations who practice employee engagement report the following results:

• 22% year-over-year improvement in customer satisfaction/loyalty
• 21% year-over-year improvement in turnover/retention

In addition, the study reveals that eight in ten of these top companies attribute changes in profitability and/or revenue DIRECTLY to employee engagement initiatives. According to the Aberdeen Group, it’s never been more obvious that employee engagement is a necessary element in any organization.

“Top companies are moving beyond employee satisfaction — a one-way street which only measures if the employees needs are being met by the organization — to employee engagement, which is all about aligning individual, organizational and customer needs,” comments Mollie Lombardi, research analyst, Aberdeen. “It is no wonder that companies who provide their leaders with tools and training to engage their employees are achieving impressive business impact.”

If you haven’t been taking employee engagement seriously in your strategic implementation, why not? Instead of trying to keep employees happy or just keep them around- organizations must actively engage employees in creating their future and their usefulness within the organization- especially in a time when no one can afford the costly loss of employees.

Drivers of Motivation

These drivers influence the discretionary effort given by employees. The choice to give this extra effort comes from within. When these factors are present, employees choose to give more than just that which is required to get by:

• Job fit with personal strengths
• Accountability
• Knowing contributions are valued
• Alignment with personal goals and mission
• Strong leadership
• Stimulating work environment/team

The current economic situation can have both a positive and negative impact on motivation. The pessimist will see these difficulties as de-motivators. However, the optimist knows that difficult times can serve to unite the troops in a common effort and goal. There will be opportunities to challenge employees to stretch and grow in their positions. Here it is important to ensure employees are in the right positions and have strong leadership.