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The rise of the naked leader may sound daunting, but according to Dik Veenman - founder of The Right Conversation - with the right training and education, leaders can be a crucial part of ongoing conversations. Below, Dik explains what it really means to be a naked leader.
“As of September one of the largest companies in the world will do all of its employees and managers an enormous favour; it will get rid of the annual performance review.”
Washington Post
When Accenture recently announced its plan to scrap annual reviews, this enthusiastic response was typical. Accenture is part of a fast-growing list of major corporations — including Deloitte, GE, Microsoft, Adobe, Gap, even the UK Post Office — who have recently been in the headlines for scrapping and redesigning their performance management systems.
With hindsight, given the universal criticism of annual appraisals, it is more surprising that they lasted so long than the fact that they are now being replaced.
However, the evidence that traditional systems do not work has been given new urgency. These cumbersome and bureaucratic systems suddenly look completely anachronistic. In workplaces that have moved on from traditional command and control hierarchies to ones that value teamwork, collaboration and matrix-style management, simplistic judgements of performance from on high are a bad fit.
In addition, a process based on delivering annual or bi-annual feedback is fast becoming an embarrassment and a liability for companies that want to attract and retain young employees, who want more regular feedback and expect to be coached.
Scrapping annual appraisals removes a major time-waster and de-motivator at one fell swoop. However, just getting rid of them does not guarantee improved performance management. Reaping the benefits depends on what replaces them, and how the change is managed. Reform involves much more than replacing one process with another.
Genuine performance management — getting the best out of people and developing their potential — is almost the definition of management.
“The art of leadership is not to spend your time measuring and evaluating.”
— Pierre Nanterme, CEO Accenture
Scrapping annual performance evaluation is an opportunity to develop a much more effective leadership style as a whole. The key objective for organisations that scrap their annual appraisals is to replace them with more authentic on-going conversations.
However, whilst replacing annual appraisals and delegating responsibility to local managers may increase the opportunity for genuine performance conversations, this outcome is not a foregone conclusion.
In reality, many managers use the appraisal process as a fig leaf.
They might criticise and dislike annual appraisals, but they hide behind the structured agenda and tick box ritual of the meetings to avoid ‘difficult conversations’. Then they blame the system.
We need to recognise that this is a human trait — in life as well as at work. We want to avoid the emotion involved in telling someone bad news. We are hardwired to avoid conflict. Telling colleagues that their performance is not up to scratch can definitely be considered a ‘difficult conversation’. Too many people chicken out; avoiding the conversation altogether or failing to explore the issues. The UK CIPD reports that around 70% of line managers admit to having avoided a difficult conversation in the past.
Asking managers to engage in less structured and more personal conversations represents a major change in many organisations.
It leaves many managers feeling naked.
For less formal performance management to succeed, managers need training and support. Unlike the current situation, this should not focus on using the process, but on developing their personal conversation skills. Line managers need the confidence to deal constructively with conflict, to defuse defensive reactions, and to explore difficult issues constructively so that people are able to learn and develop.
Few would disagree that getting rid of annual appraisals is a good thing in its own right.
Furthermore, shifting to an approach that depends on regular informal conversations has the potential to improve much more than the performance management system. These conversations have the potential to serve as a starting point to improve the quality of leadership and to build stronger relationships at every level of an organisation leading to improved collaboration, innovation and employee engagement.
But it will leave many managers feeling unsupported and ‘naked’ which means any change requires a corresponding investment in training and education.
