Natural need to measure and improve performance

A question that often comes up – Agile talks about team performance so why am I measured on individual goals which have little to do with team performance?

The underlying problem with this question is that traditional performance management does not assess the actual performance at all. Most managers focus on the person, behaviors and skills. They rarely assess on outcomes achieved as an individual or as a team player. Outcomes may be monetary results or quantifiable validated learning or how the team defines them to be. This ensures that individuals are accountable to each other and their teams’ commitments. The second most important gap is insufficient and infrequent feedback when it is really important. A third gap is that the individual performance score is very demoralizing as it sets a comparison with peers without actually providing a common platform for comparison. Finally there is no business case for traditional performance process that says they improved productivity by 50% or more and hence should continue year on year without any improvement.

Performance measurement is very important but the conclusion is that the traditional ways need to change with increasing maturity of highly collaborative performance. This is a tall-order goal for companies and needs a tremendous amount of maturity in the organizational human resource systems. The alternate option is to design small incremental learning experiments on what could change.

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High Performing teams use the power of shared agile performance goals to improve the commitments and outcomes delivered. They also deliver this continuously in small increments rather than a massive surprise at the end of the year. Agile Performance Goals ensure the teams have a clear goal and necessary empowerment to achieve the same. Most organizations that adopt Agile eventually modify their performance management system to be one with a continuous feedback loop rather than one in which feedback is only provided annually or twice a year as they progress in their agile maturity.

Here is one way to align the goals across a team by introducing a shared goals system where 50-70% of an individual’s goals are dependent on the overall outcomes achieved by the team.

An Example of a few Shared Performance Goals between Product Owner, Engineering including QA, Project Management and other key stakeholders

Continuous demonstration of value through successful Demos and releases

Meeting or exceeding quality goals ideally measured through Continuous Integration tools. This is an important goal even at the executive management level to map a significant portion of the teams deliver on or above a quality threshold.

Meeting or exceeding outcomes committed to a release

Meeting or exceeding committed service levels on commitments for non-agile teams

In addition to these shared goals it is very important to have a dedicated time window during retrospectives for the teams to start ceremony with appreciation for each other help and support in achieving the goal for the iteration/ release. Monetary rewards tend to have a short lived memory however team recognition goes a long way and also introduces a positive peer pressure at times

Performance goals designed are to improve organizational performance and not just to be judgmental on an individual. Dan Pink tells us that what motivates knowledge workers is not the performance goal but the system of the feedback loop. The new age performance management system must think about more creative ways to acknowledge and reward teams. One of the most important ways is to do away with the culture of BONUS and focus on more honest feedback loop.

A Simple Workflow

Organizations could experiment with formalizing team recognition as part of the performance management. Modern workflow recording and tracking tools when used correctly in a safe environment allow us total visibility into not just team performance but an individual’s performance on a team. It is far better to use the team discussions to get corrective feedback right away than to wait until the end of the period to provide a formal performance review which is too late and rebuffed anyways simply due to nature of its delivery.

The wisdom of the teams is the true barometer to check and appreciate stellar performance and to eventually foster the environment of growth.

Here is a simple workflow that can be accommodated in tools for teams to appreciate and recognize each other. The wisdom of the crowd tends to not favor unfair praise.

(Click on the image to enlarge it)

There is great power in team recognition. It is known to boost productivity by almost 30% and is a common characteristic of high performing teams. Companies can also use these methods to further implement un-structured time where high performers are allowed to dedicate 20% or more of their time to projects of their choice. This helps them pick up a new skill or challenge and helps the organization achieve greater innovation. This is motivational for the individual as well - –since it provides for both mastery and autonomy)

Key Aspects from a Product Owner perspective

High Performing Organizations have the Product Owners constantly assessed. Some example criteria are as follows:

Clear definition of Value for a Release Collaborative development and update of the Release Plan 100% commitment, engagement and participation in all Agile Ceremonies 100% of stories planned satisfy the definition of ready Plans for zero carry over or de-compose epics and stories to a sufficient level of elaboration. Be available to accept the stories daily Continuous backlog grooming and story socialization Be the single voice of the customer for the Demo Alignment between product vision and organizational strategy? Incorporates emergent knowledge during the iterative cycle Is bold enough to recognize changing priorities and decomposing epics just in time

Where do you start?

As with all change it is easier to start small first so that you can learn from small experiments and adapt as necessary. Build feedback loops into the learning process. Teams are generally very honest in providing crisp feedback and a 2-3 month pilot provides a greater learning that can be utilized to gradually/ implement the new performance system at the organization level. It is not uncommon to get easier buy in at the team level. It is desired to have executive buy in which is easier with a simple business case aimed at quantifying productivity improvement and overall employee morale. Middle management resistance needs to be channeled in improving this feedback loop - they will move from things which seem easy to measure and manage into much less tangible tools - their success is also defined in terms of team and group success

High performing organizations use very simple techniques not just to assess and improve performance but also to gauge the overall organizational pressure on delivery. For Example: Simple devices such as iPads to conduct real time surveys at the entry points on simple questions –such as "are you feeling stressed today?" A Yes by more than 30% of the employees must result in a stress buster initiative by the management such as an ice cream social or other stress-reliever activity. A simple "how happy are you in your role today" survey can let management know when work pressure is beginning to take a toll and they can take active measures to support teams and individuals.

This also demonstrates to the employees that management is tapped into them daily rather than through quarterly surveys and monthly town halls, which are generally distrusted and gamed)

Summary

Don’t be afraid to halt and adapt your traditional performance review process as it is causing more damage rather than favoring a better performing organization. The distribution curve and forced ranking is completely counter to an agile culture. Performance reviews reflect the organization and they need to change to be more agile and support continuous feedback. The days of traditional performance reviews in high performing organizations are now over.

Motivate your teams every day to achieve greater outcomes. Stop bonuses as a performance management framework – it is more damaging for employees to think about their bonus components than on their goals as a delivery team. Encourage team feedback continuously. Have open candid manager employee conversation. Avoid the rating such as an “A or B or C or 1-5”. Target behaviors every day to develop an organizational character. Implement a kudos model at the grass root level. Live by the three drivers - autonomy, mastery & purpose. Finally monitor the size of the teams to maintain an effective feedback loop (ideal swivel 7 plus or minus 2). Matrix organization structures support this change too as the feedback is crisp and comes from the right stakeholders. Keep teams consistent for longer periods of time. Finally the product organization needs to be assessed regularly so that the way of working becomes a second nature. Your first step towards the new performance management system is to implement a shared goals framework for agile teams to promote greater accountability and ownership. Ideally 50-70% of shared goals are a good starting point.

Have you ever got a question from your employees – Agile talks about team performance so why am I measured on individual goals which have little to do with team performance? This article aims at designing “experiments” in adapting to a better performance management framework.

About the Author

Kamal Manglani is an internal Agile Coach with Walmart Labs. His background is strong hands on practitioner experience delivering cutting edge technology products in fast paced fortune 500 environments and has successfully implemented Agile across global brands from the US, Europe and Indian Markets. Kamal has pioneered and customized agile practices within the IT Infrastructure portfolio applying Lean Kanban principles. He regularly coaches agile to non IT functional areas such as HR and Finance.