Culture: The Bedrock of Performance

Performance management is typically defined as the process of evaluating employee activity as a function of efficiently and effectively meeting organizational needs, but is ‘activity’ really a sufficient metric?

There are plenty of reasons that a performance management initiative might fail to get off the ground: a predominant perception of the process as administrative busywork; a lack of top-down management support; siloed communications; the inability to outline clear and specific goals; or worst of all, a demoralizing lack of consistency throughout the organization.

In fact, research done by Gartner indicates that nearly 82 percent of HR leaders are likely to say that performance management in their organization is failing to achieve its primary objectives. This led to 67 percent of respondents focusing on reducing the time and effort they spent on performance management, but surprisingly, Gartner found that this actually had an adverse effect on workforce performance.

This outcome is unsurprising to Bridget Toon, Senior Director of Global Talent Management and Organizational Development at Zebra Technologies, a global technology solutions provider that empowers businesses’ frontlines to thrive in the on demand economy – as it speaks to the underlying truth of performance management. It’s not an HRcentric task, or something to undertake lightly, but instead an integral element of organizational culture that requires the utmost dedication.

Fortune favours the bold
“We are evolving,” Toon clarified at the outset of our interview, foreshadowing the iterative discovery at the heart of Zebra’s performance management model. “We have a talent management philosophy that incorporates performance, with a keen focus on recognizing both achievement of goals and opportunities for continuous improvement.” Executing on that philosophy requires ongoing feedback be cultivated as a company virtue, which itself is contingent upon a very high level of transparency. “We want people to know where they stand throughout the year, even after the formal review process has finished. By being more transparent as an organization,” Toon continued, “We are creating a more feedback rich, high performance, and engaged organization.”

“We were concerned about losing high-potential talent in this extremely competitive labor market, especially being in tech,” Toon explained, “And we also found we often had to rely on external talent to fill executive and senior positions. We truly believe we’re hiring the best, and if that’s true, then we need to invest in our internal talent pools so they can continue to grow and develop with us. And the way to do that is encouraging continuous performance dialogues, being transparent, creating IDPs, and being intentional with the progress we make.”

Alongside the identification of key roles expected to grow the business, and support for the individuals in them, Zebra is confident that it will grow the right talent, for the right job, to achieve the right business outcomes. “It’s going to take some time,” Toon said through a smile that underscored just how difficult this process can be, “But we’re diligently building our leaders’ and managers’ capacities for these performance conversations, supporting them with education, and giving them script-like job aides that help them bring out the things they need to hear from their team members in a performance conversation.” Through that support, Zebra’s leaders are able to create safe spaces where everyone feels empowered to iterate, try creative new things, and welcome honest feedback. Culturally, these various performance management and leadership elements are coalescing into an environment that Toon describes as ‘bold’, where teams are encouraged to not only celebrate success, but fail quickly and without fear of backlash.

Goodbye activity, hello impact
Boldness is familiar territory at Fortive, which is a provider of essential technologies for connected workflow solutions across a range of attractive endmarkets. It’s there that Shannon Flynn, Fortive’s Vice President of Corporate HR, is continually finding ways to iterate on their Kaizen-centric culture.

“What’s really important to us as part of our payper-performance philosophy is evaluating not just the ‘what’, but the “how’,” explained Flynn, “When we evaluate performance, 50 percent of the process is looking at how the individual represents our leadership competencies in their interactions with peers, teams, and leaders. We want to address the whole person through our quarterly check-ins, and do so through a lens that’s less concerned with activity and more focused on impact.”

While elements of this philosophy have been ingrained in their culture for quite some time, Fortive began doubling down on others in a decision that ran parallel to their increasing reliance on hybrid teams. They needed to further embrace flexibility, which not only enhanced their employee value proposition, but made it easier for them to iterate as a business by combatting the ways in which even the most meticulous planning can fall short. “You can set a goal, and have a list of 10 things you’ll do to achieve that, but still fall short of the desired impact even if you did everything on that list. By focusing on impact,” continued Flynn, “We both move the needle forward and give teams more flexibility to iterate along the way if the current course of action isn’t producing the desired outcomes.”

Packaged as part of their ‘Moments That Matter’ talent strategy, Fortive is shifting performance management, stakeholder engagement, workplace returns, and even how they connect as human beings away from effort for effort’s sake and towards true intentionality. “We’re still in the early days,” said Flynn, “But I’m hearing a lot of promising conversations from leaders about how they’re thinking about the way work is done, who should be involved, what work most benefits from being in person, and how talent can be used to achieve the best outcome.”

While the technical elements of Fortive’s performance management process itself haven’t greatly changed, it has been significantly enhanced by management training on inclusive behaviors, empathy, bias recognition and mitigation, and the many other emotional intelligence (EQ) elements that compose an impactful leader.

In the cases of both Zebra and Fortive, this intermingling of cultural and performance management improvements speaks directly to what today’s employees want. A Society for Human Resource Management (SHRM) article from March of this year reported that nearly 68 percent of workers say they would stay with their employer throughout their career if the employer made an effort to upskill them, with 65 percent saying they’d be content with reskilling. These figures were derived from the University of Phoenix’s Annual Career Optimism Index for 2022: an analysis of 5,000 employees and 500 companies that also indicated 52 percent of workers fear they are replaceable. By equipping leaders to have ongoing, transparent performance management conversations, and following them with targeted succession planning and skill development support, both Fortive and Zebra are carving out names for themselves as employers that care.

Leadership as facilitation
Heather Krentler, Chief Administrative Officer at Michigan’s largest food management company, Continental, has been working to do the same. The pandemic and its subsequent Great Resignation had recruitment, engagement, and employee inspiration levels at all-time lows. Recruiting for certain positions, such as warehouse associates and servers, had always been a challenge, and given the media’s discussion about inflation, they first assumed the way to solve the problem was to adjust pay rates.

“As it turns out we were mostly wrong,” Krentler shared. Compensation proved to only be a small piece of the overall puzzle, and had less influence than conventional wisdom would suggest. “People would claim compensation as a reason for turnover, but they only did that because it was an objective metric they could point to. The reality was so much more subjective than that, and we needed to start looking at the whole person and whole experience of employees to create labor strategies that reflected the realities of our many subcultures within the organization.”

“A great example,” continued Krentler, “is our largest warehouse which has historically struggled with high turnover. We created this ‘Warehouse Warriors’ program, originally just to celebrate the values of that subculture and what it meant to be a star on that team. But that’s evolved to include not just the values component, but an incentive compensation plan, career pathing, and an entire overhaul of the physical space.” Its impact has been tremendous: “It altered the culture of that location almost overnight. We created a space for them to congregate, and connect, and feel the gratitude we have for them, and turnover practically disappeared.”

What was possibly most telling for Krentler is that this wasn’t her idea, or even HR’s – it was the employees’. “I’m no psychologist, but I think the labor market is looking for ‘control’ more than ever before.” This is the same lens through which Krentler views the future of performance management, succession, and professional development: “People want to design their own careers, and even if they don’t want to see their role change, they want to shape their own experience in it.”

Opening the door for that kind of dialogue between staff and leaders required Continental to put EQcentric leadership skills into practice on the back of a series of surveys, focus groups, and candid conversations. “Leaders had to practice humility and recognize that the best ideas come from the people living the experience, and those closest to it,” stressed Krentler. “Rather than being the designer of the solution, they needed to realize they’re its facilitator and champion, because it’s bigger than them.”

The Tao of HR
Like Krentler, Flynn has found that managers and leaders often feel burdened by the process of performance management, without a clear understanding of the interconnectedness of the many resources and support mechanisms available to them. Toon found that the ability to create psychologically safe spaces where individuals feel empowered to innovate and express their needs is critical to developing that feedback-rich, highperformance culture. And in a way, we can better understand the tie that binds by framing their experiences through the teachings of Taoism.

The practice of ‘wu wei’ sits at the heart of Taoist philosophy, and it’s a phrase that has been difficult to effectively translate into English. ‘Wu’ is a negation, while ‘wei’ can have several meanings, one of which is ‘action’. This has led to ‘inaction’ being one of its most common translations, and with it, a slew of scholars that wrongly position Taoism as the philosophy of “doing nothing”. Philosopher Alan Watts argued that instead of ‘action’, wei could be better understood as ‘force’ – “And so, wu wei is the principle of ‘not forcing’, and is based on knowledge of the tide.” The tide he’s referencing is the natural flow of the situation itself, and rather than trying to fight against it, a wise person uses their limited energy to flow with that momentum to reach their goal.

By that logic, the basic blueprint for changing culture to facilitate better performance management becomes clear: break bread with the teams that know the business best to understand their needs; identify what high performance means as it pertains to the business’ goals; and rather than force one to conform to the other, be the broker that allows both sides of the employer-employee relationship to find camaraderie in a shared vision.

Easier said than done, of course, but the reality is change simply isn’t successful when forced. Humans are off put by interactions when someone’s heart just isn’t in it – a reality reflected in the backlash companies receive when their “employee-centric” promises prove to be little more than lip service.  As Krentler frames it: “If you respect your people, and treat them like they’re precious to you, their performance gives it back in spades.”