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Business Journal
The Hard Work of Performance Management (Part 3)
Business Journal

The Hard Work of Performance Management (Part 3)

by Glenn Phelps, Jean Timmerman, and Mike McDonald

Companies cannot improve performance management if they don't know what it is. In the first two articles in this series, we defined performance management as monitoring, evaluating, and influencing employees' job performance. We also argued that performance management systems usually fail because they lack objective measurement and don't include improvement programs for individual workgroups.

For nearly four decades, The Gallup Organization has studied workgroups that are the best in their industries, as well as teams that have presented the toughest management challenges. In the first two columns in this series, we distilled Gallup's observations into four types of teams based on HumanSigma performance: the Good, the Bad (Type One), the Bad (Type Two), and the Ugly. We also showed how to create team improvement programs for the latter two types of teams. (See "Managing Your Human Sigma" in the "See Also" area on this page.)

CHART: HumanSigma

In this article, drawing again from real-world examples, we'll look at how to manage a team with high customer engagement scores but low workplace engagement scores (the "Bad, Type One" team in Q2) and a team with high scores in both customer and employee engagement (the "Good" team in Q1). (See the HumanSigma chart above.)

Managing the "Bad (Type One)" team

This team represented a workplace in turmoil, and its dominant characteristic was conflict between employees and the company. Most employees were dedicated and worked hard, but they felt alienated from the rest of the organization. A "What's in it for me?" environment prevailed, and trust and support among coworkers was sorely lacking. The only cohesion among employees sprang from resentment at how they were treated by their employer.

It was possible, however, to turn this situation around, and the management team was the key. Two of the original team managers were replaced, and a new management group began the hard work of reestablishing relationships with the employees -- reconnecting them with the company, their clients, and each other.

Improving the situation was difficult and time-consuming for the new managers; almost all of the connections that had to be reestablished flowed through them. To the employees, the managers represented the company because they ensured that corporate performance requirements were met. Also, in essence, the managers stood for the team's clients because managers demanded that client goals were achieved. Furthermore, managers shaped relationships within the team because they reinforced the idea that employees should respect each other.

Without talented managers and their persistent efforts to rebuild relationships, the team's performance would have worsened. Instead, the managers spent long hours connecting with their employees. They talked with team members individually about their jobs and themselves and developed close relationships with their employees. They showed interest in them and earned their trust. As a result, the team raised its workplace scores from the bottom quartile to the top quartile in one year, while simultaneously maintaining their outstanding customer scores.

This was a hard-won victory for all. Building relationships and regaining trust isn't easy. But, as the next story illustrates, it's at the heart of sustained performance.

Managing the "Good" team

"Good" teams generate positive, self-sustaining energy that inspires and motivates other teams. When a high-performing team takes on a project, costs per unit of work start to drop. Also, individual pay increases if compensation is structured to reward value production. (See "Giving Them What They Deserve" in See Also.)

How do these teams do it? Well, quite simply, with teamwork. And teamwork requires close relationships. The bonds that develop among team members drive performance levels -- the more effectively team members interact, the better the team performs.

The correlation between team closeness and performance reveals itself in a number of ways. The first is transparency; every member of the team knows what everyone else is doing and why. There are no hidden agendas. The teams also have no artificial hierarchies; no job is deemed more important to the team than any other. Every contribution to the team is recognized and rewarded in accordance with its role in value creation. In fact, on these teams, managers often earn less than their top performers -- and that's how it should be. The front-line employees are the revenue generators, and managers perform a support role.

A manager's role of primary support requires a deep involvement with his or her employees. Managers spend a great deal of time getting to know each employee so they can help create the optimal work environment for each team member. It is hard work to support the relationships that exceptional performance relies on, but without this support, performance quickly degrades. Capable employees have a drive to execute at the highest levels, but they need relationships of mutual trust and support with their coworkers and managers to sustain performance. Creating dynamic workplaces that inspire outstanding team performances provides benefits to both the teams and the company.

Conclusion: Great managers build great teams

It's easy to learn from managers who spend their work life building and sustaining great teams. And by analyzing their stories, the irrefutable principles of successfully implementing performance management systems -- and of managing "Good," "Bad," and "Ugly" teams reveal themselves:

  • Irrefutable principle number one: You cannot overestimate a manager's influence on team performance. As one executive who oversees a successful performance management system says, "Over time, a team becomes a reflection of the manager." Managers with a weak performance orientation produce teams with lackluster performance. Managers who care little for their team members engender conflict between employees and the organization..
  • Irrefutable principle number two: Companies must invest the time and resources necessary to get the right person in the manager position. Strange though it may sound, having no manager at all is a better choice than saddling a team with a bad manager -- because no force can overcome irrefutable principle number one.

For better or worse, teams and organizations will succeed or fail based on the quality of their managers. Lousy managers drain productivity and morale. Great managers drive maximum performance. The principle is simple and straightforward. The hard work is finding and developing great managers to lead your teams.


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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