Transforming Workforce Performance

in the New Reality

Accenture Point of View on Performance Management

Introduction
The world today is a different place, thanks to the recent recession, which
had a significant impact on organizations across the globe. One of the biggest
changes engendered by the recession involves how organizations think about
and manage workforce performance. Following cutbacks and redundancies,
organizations now have leaner workforces and rely on a smaller, more
effective pool of talent.
In these challenging times, organizations are more reliant on their ability to
motivate each individual employee to put forth discretionary effort and realize
their full potential. Furthermore, as organizations look for sustainable and
profitable growth in the future, they are facing new challenges managing new
generations within the talent pool.
These are all parts of this new reality.
As the full impact of the recession
becomes clearer and early signs of
growth begin to emerge, organizations
find performance management will
play a greater role in their ability to
achieve their business objectives.
According to one recent survey, the
importance of performance management has grown in the past year,
with 40 percent of companies naming
it as their top priority.1

However, despite this growing

importance, most organizations still
struggle with infrequent, remedial
and poorly embedded approaches to
performance management that are
counter-productive and inadequate
for dealing with shifts in talent pools,
new generations of employees and
the demands of managing a global
employee base.
To help organizations address these
challenges, this paper explores
performance management practices
from leading organizations that
enable leaders to create and sustain a
cycle of performance multiplication.
In particular, it considers how
performance management can be:

Strategic: how enterprise and

individual performance can be
dynamically aligned.
Engaging: how performance management can be a positive, strengths-based
experience that motivates the workforce.
Commercial: how the costs of poor
and variable performance can be
managed.
Integrated: how performance
management drives optimized talent
management.
Segmented: how performance
management can be adapted to
increase adoption and impact.

Figure 1: Performance management cycle

Monitoring &
Managing

Planning

Recognition
and
Reward

Performance
Management

Performing

Feedback
and Review
Developing &
Coaching

What is
Performance
Management?

Performance is primarily about results,

output and productivity. However, it is
also about understanding the impact
individuals have on these achievements
and the way in which they are achieved
(e.g. professional conduct).

Before delving into the practices

mastered by leading organizations,
we need to agree on exactly what
performance management is. In
simple terms, performance management can be defined as managing
employee performance toward the
achievement of individual, team
and organizational objectives.
Key factors underlying this definition
are employees capacity and ability
to perform in their roles and teams;
their motivation to perform with
discretionary effort; how their
leadership and other factors support
their performance; and how well
their efforts are aligned to the
organizations overall objectives.

Many people think of performance

management in terms of formal
systems of annual appraisal that are
monitored and managed by HR. Our
performance management approach,
however, considers it a more pervasive
part of working life and organization
culture. It is a continuous cycle of setting
expectations, managing, coaching and
developing, as well as providing regular
feedback, review, recognition and
rewards (see Figure 1). This paper
explores some of the practices leading
organizations have employed that
move beyond traditional performance
management systems and processes.

Planning: setting expectations and

objectives with individual employees
and teams and planning for how these
will be met.
Monitoring and Managing: tracking
performance levels, motivating and
addressing issues in performance.
Developing and Coaching: developing
employees skills and the capacity to
perform in current and future roles.
Performing: individual employees
taking responsibility to deliver results
against objectives and standards.
Feedback and Review: providing
regular informal feedback and periodic
review of performance.
Rewarding: formal and informal
recognition and rewards for effective
performance.

Performance Management in Leading

Organizations
Performance
Management Is
Strategic
Organizations must have clear
direction, but also be able to change
quickly in response to disruptions
or opportunities in the market.
However, in many organizations,
company strategy and individuals
performance are disconnected.
How can this be addressed?

In leading organizations, there is a

dynamic link between enterprise and
individual performance management.
Such organizations have clear strategies
and values cascaded down to both team
and employee objectives (what)
as well as into behavioral competencies
and standards (how) (see Figure 2).
In these organizations, individuals
understand the strategy and key
success factors and managers have
an important role in building the line
of sight, bringing the vision to life
for their teams. Business results are
communicated clearly and professionally to employees in a way that the
commercial language and realities of
the organization are shared, not just
the realm of investor briefings and

board meetings. In a recent Accenture

study, 48% of leading firms provided
clear line of sight of strategy to
their employees vs. 29% in laggards2.
Corporate strategy and values remain
a relatively constant set of goals to
align performance. However, teams
and individuals also need to adjust
their objectives to align to more
frequent shifts in business priorities
and meet commitments made to share
holders, regulators, customers and the
public. Cascading of objectives should
be coordinated across business units
with common messages and measures
to bring the strategy and values to life
for each level and part of the organization, but also to reflect immediate
business priorities.

Figure 2: Cascade from strategy and values

What

How

Corporate Strategy

Corporate Values

Department / Business Strategy

and Objectives

Role, Team and Job Family

Competencies

Individual Objectives

Individual Behaviours

Performance Management
4

The cascade starts at the top of the

organization and moves rapidly
downwards, remaining closely aligned
to the business planning cycle. A key
challenge is to keep the objectives
relevant to individual employees and
their reality (for example, their sales
territory). Setting realistic targets can
help focus efforts, especially when these
targets are broken down further into
interim objectives (such as interim
project dates or sales quarters). The
alignment of individual and organizational performance should be ongoing,
allowing for updates to objectives
at any time (especially for new hires/
transfers or new opportunities).
The recent global recession has
increased the complexity of both setting
and cascading objectives. For many
organizations, objectives had to change
quickly following rapid strategic shifts
resulting from events such as mergers
or turnarounds. Organizations now are
much more concerned about financial
and risk management, but also must
renew their focus on innovation and
business development efforts to restore
growth while managing environmental
sustainability as a business priority.
Underlying these shifts are longer-term
trends toward roles that are increasingly global, multiskilled, matrixed,
project-based and collaborative. Setting
objectives is getting more complicated
and can no longer adhere to a one size
fits all approach. All of these factors
are increasing the importance of prioritizing objectives, defining measurable
targets, collecting the data required
to assess progress and developing ways
to recognize shared results.
Balanced scorecards3 can be an effective
tool for dealing with these complexities
and are widely used for executives and

senior managers. They clearly highlight

the connections between short- and
long-term performance as well as
between results in areas of performance such as financial, operational,
customer, innovation and people, and
increasingly, areas such as sustainability,
social responsibility and collaboration. Even for the most results-driven
workforce, short-term targets must be
balanced by objectives that support
sustainable performance (for instance,
continuous improvement).
A common pitfall is the tendency to
include too many objectives, reflecting
everything on the business agenda
or in an individuals job, rather than
prioritized key objectives. Instead,
objectives should be focused on areas
of discretionary effort, or areas where
workforces can clearly make an impact.
Between five and seven objectives in
a performance cycle is a good rule of
thumb to follow. Formal reviews of
objectives should occur at least twice
per year, with more frequent reviews or
adjustments for specific workforces such
as sales or research and development,
or after significant business events.
Another pitfall is the excessive use of
standardized objectives (a photocopier
approach), which may accelerate
cascading and teamwork toward common
objectives, but weaken the planning
conversation and the relevance of
objectives to individual employees.
When dealing with large-scale workforces, a good alternative can be the
adoption of a modular choice objectives
bank that provides high-quality
objectives content that can be selected
and then tailored to the specific needs
of the employee.
Successful cascading and performance
management requires a clear feedback
loop and, in particular, timely, accurate
and meaningful data to assess progress.
Performance data can be a significant
enabler for change and a motivator of

increased performance as it creates

visibility and transparency. Accenture
has collaborated with a number of
organizations to develop performance workspace solutions, customizable to individual employees, which
bring together key performance tools,
resources and data in a compelling
way. However, many organizations
use the wrong measures, driven by
data availability, not impact, or fail
to share data in a meaningful, timely
way with employees. To achieve high
performance, the measures and data
used must drive the right behaviors
and results as well as promote increased
transparency and accountability
regarding performance.

Introducing new leadership

objectives and cascade process
A global consumer goods company
needed to improve its cash flow and
integrate recent acquisitions, while
trying to instill operational excellence, innovative behaviors, new
sustainability plans and stronger
people development capabilities.
Accenture helped the company
develop a new cascading process
as well as a set of performance
objectives, measures and information structures. These enabled the
company to cascade and realign its
leadership objectives, create clearer
line of sight and encourage dialogue
between managers and employees.

Performance
Management Is
Engaging
In many companies, it is not
uncommon for a large segment of
the workforce to be disengaged or
unmotivated. In such organizations,
it is critical to change the performance management process from a
box ticking exercise for managers
to a tool that can help improve
engagement.

Employee engagement levels are at

all-time lows. According to a recent
survey from the Conference Board4,
less than half of respondents indicated
that they are satisfied with their
jobthe lowest percentage since the
survey first took place in 1985. In
the United Kingdom, the Chartered
Institute of Personnel and Development reported similar results5, with
a sharp dip for younger employees
experiencing a recession for the first
time. It is clear that organizations
need to start rebuilding engagement,
and performance management plays
a key role in this task.
Yet managers and employees often
view performance management as a
disempowering and negative experience. Performance management should
motivate employees and provide them
with the opportunity to both own and
develop their performance. The key to
this is frequent, honest and constructive

conversations that empower employees

to take accountability for results and
play to their strengths. Performance
management is particularly motivational when employees have a strong
say in, for example, the type and
frequency of feedback given.
This is particularly relevant for what
is being called the net generation
of employees who have grown up with
new forms of communication and
technology. While previous generations
are used to formal communication
and traditional social networks, new
generations expect frequent, immediate communication with much wider
networks. In the context of a workplace, this can create both challenges
and opportunities.

Social networking tools (such as

Rypple, a software solution that uses
social networking to promote a more
active and engaging feedback process)
can enable employees to provide,
receive and share frequent, light and
honest feedback; outside of more
formal review systems and with a more
diverse group than just their manager.
Such tools can also provide greater
opportunities for self-management,
especially long-term development that
can move job-to-job (for example,
looking at career paths taken by
others, or gaining input on personal
development areas). Most significant
of all is the performance-enhancing
social capital that individuals can
derive from a more diverse and active
networkfor instance: instant access
to global specialists; membership in
communities of practice; or obtaining
information about similar projects.
Managers create the prevailing climate
for performance and engagement
within an organization and are often
the single-biggest influence on an
employee. Increasingly, managers will
need to play a role in bridging the net
generations expectations with workplace realities. Leaders need to show
sustained commitment to performance
management, acting as role models
and placing it clearly on the business
agenda. They can walk the talk with
their direct reports by holding them
accountable against minimum standards

of performance management within

their areas of the organization (as
defined in their objectives, reviews and
ratings). Responding to these concerns,
leading organizations include interventions at each step in the performance
management cycle.
Setting objectives should be a shared
process of agreeing on expectations
and building commitment toward
objectives. For many organizations
and workforces, it is beneficial for
employees to develop or contribute
to their objectives before they are
reviewed with their manager. In this
way, they take ownership for their
objectives and targets, and start to
plan toward achieving them. Employees
should be encouraged to identify the
support they require and how they can
add to the performance of their team.
Frequent informal conversations
and feedback within the workplace
(outside formal reviews) are used to
shape and motivate performance in a
way that is directly and immediately
related to the actions taken and the
results achieved. A common practice
is the stop, start, continue approach,
which provides early feedback to
highlight negative behaviors that
should be ceased (stop), identify gaps
where new activity, effort or behavior
is required (start), and reinforce where
the employee is doing the right things
already (continue). This approach
creates a much closer feedback loop to
reinforce success, address performance
issues as early as possible and improve
employee learning. As noted above,
social networking tools and techniques
can enable this practiceespecially for
global organizationsbut ultimately,

managers and employees need both to

provide and request honest, clear and
constructive feedback.
Periodic performance reviews
are essential in order to document
progress and allow for changes to
individual roles or business conditions.
At a minimum, these should occur at
mid-year and year-end intervalsand
more frequently for some workforces
and new joiners, or after significant
business events. The emphasis of these
reviews should be on the conversation and an impactful performance
message, rather than solely to fill in
a form or give the employee a rating.
In line with manager reviews,
self-assessment by the employee
can help promote self-awareness and
evaluation. This is especially effective
where performance notes or logs are
kept regarding key events or feedback
received between reviews. A number
of leading organizations, including
Microsoft, HP and Intel have taken
this approach alongside their more
formal performance review process.
Some organizations also encourage
feedback from sources including
matrix managers, peers and customers.
However, formal 360 degree feedback can be complicated and time
consuming, so it is often better for the
manager and employee to seek this
more informally and frequently.

Coaching can further create ownership

of outcomes by enabling individuals to
identify their own objectives as well
as take action to overcome obstacles
and achieve these objectives. However,
a coaching relationship takes time to
develop and is based on techniques
such as open questioning, visualization
or reflection. Some managers are
naturally gifted coaches, but others
are ill-equipped and require training
to become proficient. Coaching
relationships can also be developed
with colleagues other than managers
(including career counselors, mentors,
global specialists and sales coaches).

Building a culture of high performance

A complex global financial services
group had a weak performance
culture and low engagement scores
related to performance management.
A performance transformation
initiative won backing from the
board, and a clear vision was set and
communicated to the stock market.
Within months, the project had
delivered balanced scorecards to
the top executives, creating
significant momentum. With help
from Accenture, HR and the business
developed and rolled out a new
global approach, system and process.
The approach was tough, but
fair and consistent, promoting
strong minimum standards and
management accountability.
Also, for the first time, employees
were able to define their own

objectives, keep performance notes

and complete self-assessments.
Alongside this, significant training
initiatives boosted skills and the
quality and frequency of discussions
and reviews.
The new approach was introduced
to more than 300,000 employees
and quickly increased engagement
scores (an over six percent gain in
some measures in one year), while
also having a strong positive impact
on financial and strategic results.

Performance
Management Is
Commercial
Many organizations have undergone
significant restructuring in the past
18 months. However, executives
may be unsure that the workforces
their companies are left with are
performing at a higher level or have
the skills required for the recovery.
These companies can use performance management to help understand what they have.
Performance management cannot be
divorced from commercial reality. All
organizations should optimize and
sustain the return on investment of
their human capital assetsand not
tolerate substandard or inconsistent

results. In terms of immediate people

costs, detrimental impact on business
performance (such as customer service)
and negative impact on workforce
engagement, poor performance is an
avoidable cost.
However, poor performance is often
weakly managed by managers who
are not confident in handling these
difficult situations and therefore avoid
confrontation. For example, in one
global organization, the areas about
which employees were most dissatisfied were the management of poor
performance and the inconsistent
application of performance management. The early warning signals are
ignored and poor performers are
simply shifted around. Poor performance should be addressed in a timely,
transparent and positive way through
clear processes and by confident
managers. In this way, early coaching
can address performance issues before
they become a problem. If required,

managers should be able to instigate

a formal, written performance
improvement plan with clear targets
and timescales as well as consequences for failing to meet them. The
focus of both of these interventions
should be to seek a sustained and
adequate improvement. Once reasonable efforts have been taken, the
manager should be supported by HR
should formal disciplinary proceedings
or a managed exit be required.
So how does an organization review
and rate different levels of performanceespecially poor performance?
Some organizations consider both
absolute performance (against
objectives or targets) and relative
performance (against peers or
top performers). Opinions are split
regarding relative assessment

techniques, such as ranking, laddering

or peer comparison and rating
distribution curves. For many organizations, these are necessary disciplines
for differentiating top and bottom
performers. For instance, in one public
sector organization, over 97 percent
of staff were rated three or above
on a five-point scale, and in another
financial services organization, over
30 percent of one country was rated
as exceptional (on a five-point scale).
At a minimum, we recommend that
managers deliver a clear performance
rating against an appropriate scale
(which should be simple, with clear
titles, definitions and examples; and
consistently applied) and that calibration discussions take place within
teams and business unitseven if a
performance rating distribution curve
is not applied to ratings.
Clear ratings help identify poor
performance not already being
addressed and help track poor
performers through subsequent cycles.
Such information has been especially
important in the past few years as
many organizations have undergone
restructuring and redundancies. Where
redundancies are required, performance data is essential to ensure the
right selection decisions are made
(for instance, not resorting to criteria
such as first in, first out) and that
decisions are less open to challenge.
In one US-based retailer, a lack of
performance data created delays and
uncertainty in restructuring decisions,
resulting in the loss of a number of
top performers who took a voluntary
separation offer.

10

Achieving strategic objectives and

regulatory compliance through
performance management
A large European utility company
had identified performance management as a crucial enabler in its
business transformation program
to improve its core performance and
comply with stringent regulation
targets. Almost half of the companys
employees lacked objectives aligned
to it strategic business goals and
only 40 percent of them received
mid-year reviewsand these were
based solely on their managers
opinions. Accenture renewed the
companys entire performance
management process and introduced
governance and measurement
structures to monitor performance
and ensure follow-up actions are
taken. As a result, the company
achieved 95 percent of its objective
setting goals in 2010 and 92 percent
compliance with its ratings provision and performance feedback
targets. Furthermore, the objectives
and reviews are of a high standard
as well as being consistent and
fair due to peer comparisons and
management training. In addition,
peer comparison has helped increase
the companys focus on managing
poor performance by providing
a forum for managers to discuss
and compare individuals. Poor
performance is now managed more
explicitly through the introduction
of specific and tailored performance
improvement plans.
Knowing who and what defines poor
performance is certainly part of the
solution. However, in many organizations there is significant performance
variation and significant value in

shifting the performance curve up for

the majority of the workforce. To do
so, organizations must understand
top performing employees and how
to emulate their behaviors across
the workforce.
Calibration dialogues and the
comparison of performance across
the organization help leaders better
define and communicate top performer
profiles, including the results and
behaviors exhibited by these individuals. Conducting research on top
performers can identify further factors
that enable performance within
organizations. Some common tactics
to increase overall workforce performance include:
Providing clear minimum targets
and acceptable levels of performance.
Defining top performer profiles
including extraordinary results
and behaviors.
Removing obstacles and constraints
to performance (such as poor systems
or processes).
Improving the visibility of individual
performance and results (such as
employee dashboards).
Creating transparency of performance relative to peers (such as
league tables).
Using top performers to coach and
spread leading practices.
Aligning talent management levers
to motivate and develop performance.

Performance
Management Is
Integrated
It is not uncommon for performance
management to be a standalone
process in many organizations.
These organizations can generate
greater value from performance
management by integrating it with
their talent strategies.
Improvements in performance
management on their own can have
an immediate and direct impact on
the current workforce. However, a
more coherent and engaging employee
experience and a performance
multiplier6 effect are created when
performance management is integrated
with strategies for attracting and
developing talent over the longer term.

11

The links to rewards is particularly

important. Leading organizations pay
for performanceas recognition for
past results, and also to motivate
future performance and retain top
performers. They look at total rewards
in a strategic way, making investment
decisions regarding the future of the
business by assessing both impacts and
returns. In many organizations, this
link is weak. At one global telecommunications firm we found the economic
value added by the top 5 percent of
the sales workforce was more than 20
times that for the bottom 5 percent
but their difference in pay was only
1.5 percent.
It is essential that a clear link between
performance and reward is wellcommunicated to employees (for
instance, by redesigning total reward
statements and communicating pay
reviews effectively). For many frontline
roles, short-term incentives are more
effective than bonus payments or base

salary increases, paying more frequent

rewards based on performance against
key metrics. Implemented well, incentives can complement performance
management and motivate performance
by creating clear and highly-visible links
between effort, results and rewards.
With regard to resourcing, it is
essential to be clear on what defines
a top performer. Organizations
must identify the skills, knowledge,
behaviors, experience and other
attributes required; and reflect these
in their selection criteria. Furthermore,
organizations should make developmental roles available to internal
talent. For example, many organizations use job rotations and global
assignments to stretch and develop
top-performing future leaders who
are fluent in running the entire
business. When hiring externally,

organizations should ensure that new

joiners have clear objectives set in
their first month, regular feedback and
the induction training and support
required to become competent in their
role in the shortest time possible.

in one global organization, aggressive

expansion plans in emerging Asian and
Latin American markets demanded the
development of top-performing local
management, alongside the focused
use of a globally-mobile manager pool.

Equally important is to understand the

core competencies of the organization
and the future demands on resources
and capabilities that will be created
through executing the business
strategy and changes in the external
environment. Strategic, long-range
workforce and succession planning can
help identify the resources and capabilities required for high performance
in the future, as well as the resourcing
strategies (build, buy, borrow or rent)
required to achieve it. For instance,

Integrating performance management

with other talent management levers
to drive long term results

12

A global organization was undergoing a phase of organic growth

and wanted to improve competency
across its workforce. Accenture helped
the organization define and develop
a new performance management
approach that brought together the
what (objectives, balanced scorecard) and how (competencies
aligned to values) of performance.
Performance management and
learning management systems were
in place already (not integrated).
In addition to tracking performance
against objectives, the performance

management system was used to

evaluate performance against
competencies and for individual
development planning. Employees
could then turn their development
plan into action by adding events
to their curricula on the learning
management system and accessing
relevant learning content and
assessment. The client integrated
their performance management
system with a pay review system,
promoting a greater differentiation
of reward based on performance
(within grade and market parameters). The integration of these
talent levers has made them more
relevant for the business and has
been a major factor in helping to
drive strategic change.

Performance management should help

organizations identify top performers
as well as potential top performers by
considering not only current performance, but also performance trends,
potential and readiness. In this way,
calibration sessions can be extended
to incorporate promotion decisions,
talent identification and succession
planning processes.
To maximize future workforce
performance potential, the
link between performance and
development needs to be exploited.
Indeed, a recent report found that
companies with high-quality development plans realized twice the
revenue per employee.7 For the sake
of simplicity and time, it is often best
to combine the objectives-setting
and development-planning conversations. This should help address gaps
and development areas from previous
performance reviews, but more importantly, also address the requirements
of the role and support the employees
achievement of their objectives.

Performance
Management Is
Segmented
While a one size fits all approach
to performance management can be
simpler to manage and administer,
it is not always the best approach.
Organizations need to strike the
right balance between consistency
and providing the ability to tailor by
employee or employee segments.
In most cases, there is a strong case
for the core elements of the performance management policy and process
(for example, the calendar, system and
rating scale) to be aligned across an
organization. This consistency provides
a common language for discussing
and comparing performance between
employee groups as well as over
time. Such an approach also enables
management of employees who are
matrixed or mobile between different
business areas or countries.
Instead of treating all employees and
workforces as a single entity, leading
organizations are building on a
common foundation by tailoring their
performance management practices
to different individual and employee
group needs to maximize impact and
increase adoption. Workforce of
One pioneers such as P&G, PepsiCo,
Microsoft and CapitalOne are using
segmentation to help increase fit with
an organizational sub-culture or to
drive specific outcomes in a particular
employee group.8
The approach may need to be tailored
for different employees or workforces
(by demographic, workforce purpose and
job family / roles) as well as businesses (by
business needs or industry cultures).

13

For instance, consider the different

expectations of the net generation
(individual career paths, flexibility
and rapid feedback) against previous
generations. Another common difference is the needs and preferences of
a sales workforce (who are driven by
quarterly targets, league tables and
incentives) versus a finance team
(who are more focused on professional
development and annual bonuses)
versus a call center environment (in
which metrics-driven management
and frequent onboarding of new hires
are priorities).
The combination of a shared foundation with a segmented approach will
support organizations returning to
growth through globalization or
mergersespecially given the diversity
of emerging-market cultures. For
example, the most effective performance management approach in a
relationship-based country culture
(such as Mexico or Brazil) will be
different to that for a country that
emphasizes respect, authority and
hierarchy (such as China). It is important to remember that each individual
and the relationship they have with
their manager will also be different.
Performance management systems,
especially those that employ social
networking, can lower the costs of
customization at an individual scale.
As the next generation of workers
increasingly expects to be able to
define their own preferences and
work in their own way, employeedefined personalization can be
expected to continue as a growing
area of innovation in performance
management systems.

One of the easiest ways of promoting

personalization is to allow managers
latitude to manage and empower
employees to manage their own
performance. Organizations should be
clear on what aspects of the performance management process determine
the minimum standards, but then
allow employees the freedom to find
what works best for them and to
develop their own performance structures with support from their manager.

Segmentation across distinct

workforce and career models
One large US retailer recognized
that workers in different roles
could be motivated differently.
For example, the factors that motivate and retain managers are often
quite distinct from those for technical professionals. By looking for
groupings of employees with shared
needs and then asking them what
they wanted, the retailer created
customized offerings better suited
to specific segments of employees
ultimately resulting in a happier
and more productive workforce.

geography and behavior. Growing

markets like India and China often
have particularly great cultural
variances. In Indias family-based
culture, for example, some companies have been known to foster
loyalty by encouraging parents of
employees to visit the workplace
and by sending them letters of
thanks and recognition regarding
their children. Companies can help
maximize the performance of their
employees by tailoring the work
experience based on any of these
factors, or combinations of factors.

The retailer also used these

insights to tailor its performance
management practices through an
innovative profit-sharing program
that benefits employees with
different financial needs. Other
factors that can be used to segment
workforces include generation,

Conclusion
The global downturn has shifted the
economic, organizational and individual landscape, changing the way
organizations think about and manage
performanceand these changes are
here to stay. In this new reality, with
leaner workforces and commercial
challenges, performance management
practices are increasingly important as
an enabler of high performance.
Effective performance management
is a central part of the business and
talent strategies of high-performance
businesses. It is embedded into their
organizational DNA and helps to drive
their success through engaged and
motivated individuals and teams. It is
a continuous cycle of setting expectations, managing, coaching and developing employees, as well as providing
clear feedback and rewards.

14

However, many organizations still

struggle with weak or bureaucratic
approaches to performance management. Each organization has different
requirements and the right approach
varies, but there are some leading
practices that are key for organizations
in all sectors:

Integrated: integrating performance

management with talent management
practices to create a multiplier effect.

Strategic: aligning enterprise and

individual performance to improve
business results.

No one organization has mastered

all these areas and practice is still
evolving rapidly, in many cases triggered
by changes in technology and the
external environment. The organizations who are bold enough to adopt
practices in these areas will move
beyond simply monitoring whether
employees meet expectations to
ensuring that they attract, develop and
engage the individuals and teams who
will help them take the lead during
the next economic cycle and beyond.
These are the organizations who will
succeed in the new reality.

Engaging: creating a positive, strengthsbased experience that motivates the

workforce and encourages individual
and managerial responsibility.
Commercial: lowering the costs of
poor and variable performance, as
well as maximizing the impact of top
performers.

Segmented: increasing impact through

choice and customization against
individual employee preferences or
group needs.

Notes
1. Bersin & Associates, 2009 Talent
Management Factbook.
2. Accenture High Performance Workforce
Study, 2006.
3. Robert S. Kaplan and David P. Norton,
Using the Balanced Scorecard as a Strategic
Management System, Harvard Business Review
(January-February 1996).

6. Peter Cheese, Robert J. Thomas and

Elizabeth Craig, The Talent Powered
Organisation, Kogan Page (November 2008)
7. Bersin & Associates, 2009 Talent
Management Factbook.
8. Susan M. Cantrell and David Smith,
Workforce of One: Revolutionizing Talent
Management through Customization,
Harvard Business Press (May 2010).

4. "Cant Get No...Job Satisfaction, That Is:

Americas Unhappy Workers" (2010) The
Conference Board.
5. "Employee outlook: Emerging from the
downturn?" (2010) Chartered Institute of
Personnel & Development.

About the
Authors
Catherine Farley leads the Accenture
Talent & Organization Performance
practice in North America. With more
than 20 years of experience, Cathy
helps clients align their organizations
talent and human capital strategies
and processes with their business goals.

15

David Gartside leads the Accenture

HR & Talent Management practice.
He has over ten years of experience
in helping clients architect their
future HR operating models, set out
their journeys to reaching those
models, defining the business cases
associated with those journeys
and then delivering them through
transformation programs.
Accenture senior managers Neil Frye
and Andrew Young and manager Iris
Martens contributed to this article.

About Accenture
Accenture is a global management
consulting, technology services
and outsourcing company, with
approximately 204,000 people serving
clients in more than 120 countries.
Combining unparalleled experience,
comprehensive capabilities across
all industries and business functions,
and extensive research on the worlds
most successful companies, Accenture
collaborates with clients to help them
become high-performance businesses
and governments. The company generated net revenues of US$21.6 billion
for the fiscal year ended Aug. 31, 2010.
Its home page is www.accenture.com.

Copyright 2011 Accenture

All rights reserved.
Accenture, its logo, and
High Performance Delivered
are trademarks of Accenture.

About Talent & Organization

Performance
The Accenture Talent & Organization
Performance service line provides
solutions that enable clients to improve
the performance of their people, their
organization and their business. This
group of skilled professionals has
extensive experience across a range of
talent, organization, human resources,
change management, analytics, learning
and collaboration capabilities. Backed
by a comprehensive research program,
global resources, and unparalleled tools
and assets, Accenture collaborates
with clients to multiply their workforce
talent and organizational capabilities
into a strategic force that can drive
high performance. For more information,
visit www.accenture.com.