Companies are using software to help their employees set and meet individual and business goals
This June, 15,000 employees at Seagate Technology LLC will receive annual performance reviews that for the first time heavily weigh how close each individual comes to achieving his or her professional goals. The disk-drive maker asked its professional workforce to consider CEO Steve Luczo's top five goals for the company before submitting their own. The resulting personal targets, all 56,000 of them, can be viewed online by any employee in the company.
Sound like a data-management nightmare? It isn't, says Karen Hanlon, VP of human resources at Seagate, thanks to software from Performaworks Inc. that puts the information to use. The process started last year when Luczo typed his objectives into the Web application. In the weeks that followed, senior executives, managers, and professional staffers signed onto the system, viewed the goals set by their higher-ups, and typed in their own.
It's an ongoing process. Each quarter, managers work with employees on updating goals, and a section of the site provides coaching on how to develop and align them with the company's objectives. Through a series of mouse clicks, an employee can see all the objectives that lie between his own and those of Luczo that started the chain. Online reminders alert employees of things such as due dates for meeting goals, and workflow functions let managers transfer goals from one worker to others who might benefit from the same objectives. At evaluation time, the software assigns a score to each employee based on his or her success at meeting goals and other measured behaviors. That score is fed into an internal compensation system that helps determine bonuses and merit increases. The system also ties into Seagate's Oracle HR system, which manages general employee data.
In tough times, companies must do more than develop ambitious strategies; they must also--imagine this--actually execute on their great ideas. Like Seagate, other companies are trying to do a better job of aligning their employees' efforts with top business objectives.
For large companies with tens of thousands of employees worldwide, that's a big job. "To be competitive five years ago was much less challenging than it is today and will probably be more challenging in five years," Hanlon says. "We have to be able to communicate our priorities to employees faster and be able to make changes more rapidly."
Performance-management software produces results and empowers employees when used correctly, says Baxter Healthcare VP Katt.
It's hard to see employees getting excited about an automated goal-alignment system. After all, isn't the idea of software that collects, categorizes, distributes, calculates, and holds employees accountable for their career goals a bit, well, creepy? Not if it's done right, says Faye Katt, VP of global employee services and corporate counsel at Baxter Healthcare Corp. Just over two years ago, Baxter rolled out an automated goal-alignment system that mandates the participation of about half of its workforce of 55,000 employees.
"Are you empowering your employees, trusting them, and asking them to be responsive and results-oriented?" Katt asks. "Those are shared values, and such a system doesn't become Orwellian. It's about results, and if you're treating people fairly, it works."
Katt says she hasn't measured the system's payback in hard-dollar ROI but "you know it when you see it. You can tell if your organization's more focused. You can tell if you're making a difference."
But there are risks. If done poorly, creating an online accountability system for goals or objectives can backfire. "If you do this, you'll come smack up against your culture, hard and fast," says Maria Schafer, an analyst with Meta Group. "If you have a very autocratic culture, people will feel very threatened."
Communication is key, Schafer says. "If you say, 'We're going to be tracking you and watching you,' who wants that?" Instead, she says, companies must show employees that they're stakeholders in their businesses and that the more insight they have into corporate strategies, the greater chance there is for their companies' success.
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