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Business Journal
The Hard Work of Performance Management (Part 2)
Business Journal

The Hard Work of Performance Management (Part 2)

by Glenn Phelps, Jean Timmerman, and Mike McDonald

The previous article in this series defined performance management as monitoring, evaluating, and influencing employees' job performance (See "The Hard Work of Performance Management, Part 1" in See Also). More importantly, we argued that performance management systems often fail because they lack objective measurement.

Performance management systems also fail, we noted, because they don't include improvement programs for individual workgroups. Over the past 35 years, The Gallup Organization has studied elite workgroups in various industries, as well as teams that have presented the most daunting of management challenges. In the last column, we distilled Gallup's observations into four types of teams: the Good, the Bad (Type One), the Bad (Type Two), and the Ugly.

CHART: HumanSigma

Now, let's look more closely at how to create team improvement plans for two of these workgroups: one with below-average scores for both employee and customer engagement (the "Ugly" team in Q4) and one with scores that are above-average in employee engagement, but below-average in customer engagement (the "Bad" team, Type Two in Q3) (See the HumanSigma chart above).

These stories, culled from real-world examples, illustrate what these workgroups look like and what managers can do to improve their performance.

Managing the "Ugly" team

Describing a team that is performing poorly on both employee and customer engagement scores is quite easy once a company has put objective performance measures in place. This team exhibits poor productivity, unacceptable quality, negative effects on customers, and a miserable workplace.

What can managers do with a team like this? The answer is surprisingly simple: Disband it. By trying to develop a team that will never reach corporate goals, you'll waste time and resources that are best allocated to better performing groups.

How does a workgroup get this bad? There's no easy answer; each team and situation is different. Most often, though, as one manager put it, "It's as if the statistical gods conspired to put all our mistakes on one team." Performance difficulties arise and persist when a team is comprised of people who management wrongly believed had the talent to perform at outstanding levels. The wisest approach is to cut losses early and move the people involved to a more appropriate role or team -- or out of the company entirely.

Failing to disband a poorly performing team produces no positive outcomes -- not for the company, and not for the individuals involved. A beleaguered member of one struggling team uttered this unforgettable quote during a focus group: "This is the worst place in the world to work. We all hate our jobs. Things are so bad here that we have a pool betting which one of our coworkers is going to show up at work with a gun and start blowing people away."

The stress in this work environment was palpable to everyone who came in contact with it, and team performance reflected this untenable situation. This team had never met assigned goals, and it showed no improvement toward those goals after 12 months. It was clear that keeping this team together was hurting not only company financial performance but also the individuals on the team.

Unfortunately, in this situation, the company decided not to restructure the team. At last report, this team's performance had not improved, team members were still miserable, and the situation was still drawing a disproportional amount of management resources.

Managing the "Bad (Type Two)" team

Teams in this class show a pattern of great workplace scores accompanied by poor productivity and quality. Let's take the case of a team that had consistently high workplace scores -- as measured by Gallup's Q12 (See "Feedback for Real" in See Also) -- when measured over 18 months, but that consistently ranked last on other productivity and quality measures. The situation was a mystery. Why doesn't a great workplace automatically result in high scores on other measures? The answer came with a little digging into the numbers and some focused interviews with team members.

The mystery started to unravel with the discovery that although Q12 scores were high, overall satisfaction with this company as a place to work was very low. Furthermore, interviews with team members who had voluntarily left the company revealed a team in turmoil. They described their manager as a nice person who lacked the ability to manage -- with no focus, no clear goals, no organization, and no consistency.

The team environment was also characterized by a "blame the company" attitude. Frequently, the manager would realize that his team wasn't meeting deadlines on a project's performance objectives. His typical response was to start a panicked and unsuccessful drive to meet the targets, shifting responsibility and blaming the crisis on unreasonable requirements from top management. One former employee described the team's attitude as: "Let's show up and hang out with our friends, and when the company interrupts our fun with unreasonable expectations, we'll get mad at them."

In an effort to improve the team, the company replaced several managers. But the negative culture remained, and performance continued to lag. The company eventually downsized the team and allocated much of its work to the rest of the organization. Remarkably, this caused no stress on the system -- the remaining teams just picked up the slack. It seems that the crisis-driven nature of the team may have suppressed not just its own performance, but overall organizational performance as well.

One lesson from the stories in this installment should be clear: A successful performance management strategy requires the optimal application of resources. Some situations aren't worth the resources needed to improve performance. And performance management can't be effective without the ability to dissolve an underperforming team.

In the next article in this series, we'll discuss how to manage teams from the other two quadrants in the HumanSigma chart: the "Good" and "the Bad (Type One)." In those examples, management intervention produces positive outcomes.

But, as we'll also discuss next month, each situation is different, and each team responds in its unique way. Regardless of a team's current level of performance, the course of action for improvement must be designed to fit the team. In the end, effective performance management happens team by team.


Mike McDonald is Director of Engagement for Gallup's U.S. interviewing centers.
Glenn Phelps, Ph.D., is a Senior Consultant with Gallup.
Jean M. Timmerman, M.B.A., is Executive Director of Interviewing for Gallup.

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