Rethinking performance management

1. Increasing the
probability of a positive
outcome
Predictive Performance
Analytics
Applied People Intelligence ©

2. The Current Performance Paradigm
Metrics are important for managing performance:
If we can measure it, we can manage it
Metrics need to be SMART:
The less ambiguous a metric, the better it is
Metrics should be task specific:
Measurement needs to be directly related to the context
of the job

3. The Current Performance Paradigm
These paradigms are valid when the purpose is to:
Communicate: Tell people specifically how and
where to focus their energy and effort
Motivate: Reward people for the accomplishment of
a specific goal or outcome

4. An Additional Performance Paradigm
These paradigms are NOT valid if the purpose is to:
Diagnose: Understand why someone is not
achieving a specific goal
Predict: Determine the likelihood that someone will
successfully achieve a goal

5. An Additional Performance Paradigm
The new approach is not a substitute for the
current performance paradigm
But
It is an additional perspective for increasing the
probability of a successful outcome

6. Using both performance paradigms
Situation:
Performance manage your country’s soccer team to win
the next World Cup
Existing paradigm (Metrics):
Communicate: Score more goals than the other team
Reward: $1 million per player
New paradigm (Analytics):
Diagnose: What dimension/s of performance are required for success?
e.g. the ability of the captain to motivate the team when down
Predict: What is the likelihood that this will happen? i.e. does the captain
have the ability to motivate others?

7. When the current paradigm fails
1 slight change
Communicate: Score an average of 2 goals per game
Reward: $1 million per player
What will this communicate and how will it motivate?
• Individual performance is more important that team performance
• Failure to score 2 goals in one game (against a tough team) can be
compensated for by scoring more goals in another game (against an
easier team)
• It doesn’t matter if the other teams score 3 goals each game, as long
as you score an average of two.
• Making enough money to pay the R 1,000,000 is not my problem.
• I have no interest in whether anyone else gets a bonus, and therefore
they will have no interest in me achieving mine.
• If I score an average of 1.8 goals per game, I still want some bonus,
and if I average 2.5, I want a bigger bonus, regardless of how we
perform in the league.

8. Why the old paradigm gets in the way
“Metrics are important for managing performance”
If we can measure it, we can manage it
While this is partly true, it relies on “managing” after the fact, i.e. only
when the person is off target, or has missed the target, which may be 12
months later, can you act.
The new paradigm relies on predicting what factors may cause the person
to miss the target before they even start trying to achieve it.
You can then proactively allocate, or re-allocate, resources to prevent
failure and support success.

9. Why the old paradigm gets in the way
“Metrics need to be SMART”
The less ambiguous a metric, the better it is
Once again, this is useful if the task or outcome is not particularly complex,
i.e. it does not rely on the co-operation of, or collaboration with other
people or functions; it is achievable in the short term; the environment
doesn’t require constant adaptation to changing conditions etc.
The new paradigm deals with dimensions of performance, e.g. the quality of
the work a team produces; the ability of a person to deliver (any result) on
time; the ability of a group to innovate (when the specific outcome is
undefined).
Most work takes place in a changing, ambiguous, undefined context. By
being able to focus on the dimension of performance, the specific outcome
can adapt to the specific context.

10. Why the old paradigm gets in the way
“Metrics should be task specific”
Measurement needs to be directly related to the context of the job
Although specific goals may change as targets shift, new projects are rolled out,
processes change and people move, research has shown that performance against a
specific dimension, e.g. on-time delivery remains relatively constant.
The new paradigm recognizes that if time management, priority setting and
technical proficiency are not strengths of a particular individual, they will
consistently struggle to deliver on time, regardless of whether it is a new project, a
new process or a new team (unless the team are able to compensate for the
weaknesses).
In other words, the likelihood that someone with a certain behavioral profile will
change their behavior, and therefore have a different performance outcome, is
limited.

11. What we know from research
1. There are certain generic predictors of performance:
• Energy and drive (achievement orientation)
• Conscientiousness (big 5 personality factor)
• Social awareness (Emotional Intelligence)
• Functional competence (Technical proficiency)
2. Job specific/contextual requirements
• Extraversion (Sales)
• Agreeableness (customer service)
• Conscientiousness (Engineering)
• Emotional stability (call centers)
• Openness to new experiences (creativity/innovation)
Can we expand these dimensions to predict the probability that an individual
will successfully achieve a given performance outcome based on the role they
are required to play?

12. How a performance issue is described
When managers see a performance problem for an individual contributor,
they may often describe it like this:
• Low personal motivation/Lack of drive
• Negative attitude/Lack of willingness
• Lack of initiative/proactivity
• Lack of technical competence/ability
• Lack of autonomy/Inability to work independently
• Poor quality of work/output
• Low personal productivity/ Poor use of time
• Inconsistent delivery/Lack of reliability
• Lack of responsiveness/Slow reaction time
• Lack of teamwork/collaboration
• Poor customer service level
There is a direct correlation between these observed performance
dimensions and the behavioral characteristics of the individual.

13. Identifying the underlying cause
Observed behavior: Poor quality of work/output
Underlying behavioral attributes are:
Attribute Definition
Bright Has difficulty grasping complex concepts or ideas,
oversimplifies them and lacks the necessary depth of
understanding
Demonstrates good
judgment
Shows poor judgment and does not anticipate the
consequences of decisions, or has taken wrong decisions
previously
Detail-orientated Appears disorganized and lacks attention to detail
Improves Processes Overlooks or appears to be disinterested in opportunities
to improve work processes
Technically Competent Lacks critical functional and technical knowledge and skills
to do the work
Diagnose and Predict

14. Performance dimensions differences
1. By level
• Individual
• Supervisor/Team Leader
• Specialist
• Senor Manager/Executive
2. By role
• Innovation
• On time delivery
• Credibility
• Resource management
• Quality of output
• Responsiveness
• Motivating a team

15. Summary
1. The new performance paradigm does not replace the current one that is “metric-centric”,
it compliments it.
2. The new paradigm is future-focused and creates the ability for diagnosis (why
something happens) and prediction (what will most likely happen).
3. The new paradigm works with dimensions of performance, rather than with specific
targets and goals, which more closely aligns with the need for people and
companies to adapt to changing conditions.
4. The new paradigm correlates behavior with the ability to achieve a particular
performance outcome when someone is acting in a specific role.
5. The new paradigm recognizes that behavioral change can be difficult and take a
long time to occur. A person’s ability to achieve a performance outcome that is
dependent on their strengths is significantly better than their ability to achieve an
outcome that depends on their weaknesses.
6. The purpose of the new paradigm is to increase the probability of a successful
outcome by identifying the possible causes of failure ahead of time and taking
steps to minimize or neutralize them.

16. PeopleTree Talent Analytics
Martin Sutherland
Global Director
+2783 453 1593
martin@peopletreegroup.com