Culture and engagement has emerged as the number one business challenge
A high performing workforce is crucial for any organization’s survival in a VUCA world. It is a recognized fact that a performance driven workforce has the potential to increase innovation, business productivity and even impacts the bottom-line in a positive way.
To drive performance, organizations need to instill a sense of purpose in their employees and also need to align employee objectives to that of the organizations. Employees are motivated more to perform when they have a sense of purpose, they feel they are actually contributing to something, and there is a reward tied to it as well. Its relevance is exemplified when we talk about the workforce of tomorrow. The ‘Millenials at work’ study by PwC revealed that 51 percent of the millenials questioned said that feedback should be given very frequently or continually on the job and only one percent said that feedback was not important to them.
So for organizations it is important to ensure the workforce keeps getting feedback. Not only does it tell people what they are doing right and what they need to do differently, but it also ensures they are constantly aligned with the organization’s purpose and objectives, and their individual goals are attuned to the business’ (which in today’s world are very agile and susceptible to change).
People want clarity on objectives and want “timely, insightful feedbacks to stay on course of their purpose, know what is it that they are doing well and also know what are the things that need to be done differently,” says Ravindra Kumar, Head – Human Resources, GE South Asia.
Enabling performance by performance management system
For organizations to drive forward, the workforce’s performance doesn’t only have to be ‘managed’, but it has to be optimized; and a feedback-model of performance management can achieve that. The performance management system has to go beyond measuring, rating, and reviewing employees, and act as an enabler to unleash the potential of the people and get the best out of them – something that is supposedly achieved by feedback-led models.
It is no surprise that several organizations have gotten rid of force fitting employees into the bell curve, and have adopted real-time feedback-driven models of performance enhancement and evolution. An organization’s processes are a reflection of its culture. The changes in the way performance is measured today have changed because of a shift in culture and employee expectations. Today, people expect a workplace which enables and guides them towards achieving their true potential in the chosen area of profession. In addition to clear objectives, people also want timely, insightful feedbacks to stay on course of their purpose, know what is it that they are doing well and also know what are the things that are needed to be done differently.
The culture factor
The new workforce today expects a more horizontal, agile, connected and inspiring organization, and not the command and control organization so that they get a chance to develop with the organization. “They are looking to work in an organization that enables co-creation. People want to create the culture that they like and it cannot be dictated anymore,” says GE’s Ravindra Kumar.
Organizational performance is correlated with its culture. Every organization’s culture defines and determines how the organization functions. The culture either drives the performance of an organization or impedes success as it affects talent, product offerings and even employee engagement. The HR plays a crucial role in shaping, transforming and reinforcing the culture of an organization. In fact, it is the HR levers that create the culture in organizations.
For businesses to keep pace with the changing business environment, they constantly have to innovate. And people have to be the source of that innovation. So it is important for organizations to create a culture of risk-taking and celebrating failures. HR should consider using its levers like pay systems, performance management programs, recruitment etc to develop and sustain corporate culture that not only drives employee performance but also impacts organizational outcomes.
Culture: No more a soft issue
Culture and engagement can no more be refuted as a soft issue. In the Deloitte Global Human Capital Trends Study 2015, it has emerged as a top business challenge. The percentage of respondents citing it as “very important” has doubled since last year. Only 12 percent respondents said that their organizations are “excellent” at effectively driving the desired culture. In this new world of work, it is important for businesses to fulfill people expectations – to keep them engaged, keep them empowered, and get the best out of them. The companies with an engaged culture, “hire more easily, deliver stronger customer service, have the lowest voluntary turnover rates, and are more profitable over the long run,” says the Deloitte study. Businesses can’t continue to ignore engagement as a soft issue because not only is an unhappy employee going to move away, (s)he is going to impact several more not to move in – courtesy the social media.
Unfortunately, organizations haven’t been able to engage people well, as indicated by Gallup’s employee engagement study which reveals that only 13 percent of the global workforce is highly engaged. Organizations need to invest (not necessarily monetarily, but in terms of strategy) in keeping their employees engaged.
It is important that organizations keep calibrating and course correcting engagement levels to ensure people drive business outcomes.
Employees should be connected to the overall business purpose
Ravindra Kumar, Head - Human Resources, GE South Asia
To drive excellence in performance, people in an organization need to have a sense of fulfillment and purpose when they are working towards their objectives. They need to have a clear understanding of their objectives and an understanding of how their objectives are aligned to the organization’s – that makes people think they are contributing and are an integral part of an institution. Leaders play a very crucial role in this process. They need to help employees connect to the purpose and how they can contribute to achieving it.
Today, people expect a work environment where they can achieve their true potential in the chosen area of profession; in addition to clear objectives, people also want timely, insightful feedbacks to stay on course of their purpose, know what is it that they are doing well and also know what are the things that are needed to be done differently.
The methods of performance measurement have also evolved with this cultural shift. Employees expect regular dialogue on the priorities they need to focus on, insightful and timely feedback on how they are doing and want it tied to a result or a reward – not necessarily monetary, but also in terms of recognition and growth, which motivates them to contribute even more. So evolution of organizational culture has a direct impact on organizational processes.
Organizations including GE are (and need to) moving away from ranking and rating people (the bell curve), which can be associated with labeling. The new workforce wants to see a more horizontal, agile, connected and inspiring organization, and not the command and control organization. In the collaborative organizations that are evolving, there is a lot more opportunity for employees to get richer feedback from people around them instead of just their managers. In fact, managers should also get benefit and feedback from everybody and not from just their manager. At GE, we have moved away from ‘Performance Management’ to a ‘Performance Development System’, that is built on these principles.
Organizations' nature is changing
Leo Puri, Managing Director, UTI Asset Management Co. Ltd.
The role of leaders will be more crucial than ever to create an organization culture that empowers its employees and gives them the motivation to perform.
Organizations which are self-driven and have empowerment at the center of the value system can be agile. Command and control organizations worked fairly well earlier, but there have been social changes around people’s perception of hierarchy and knowledge economy. There is a different set of value systems in people that defines satisfaction. People want to be empowered, and not commanded or controlled. Given all of that, it would be foolish to try and run an institution modeled on the ‘command and control’ lines. Not that it stops some organizations from trying. But these organizations are very brittle and deeply threatened for sustenance.
Given the changing expectations of the workforce, I think leaders have to play a very different role. They have to provide a level of conceptual leadership combined with tremendous sense of empowerment and liberation to try to unlock energy that might already exist and find ways to use latent energy in the organization more productively.