Performance management vendors often say that adopting their tools must be done all at once, starting at the top of the organization. They argue that, without executive buy-in, a performance management deployment will not have the mandate needed to succeed. Furthermore, the argument continues, without an enterprise data warehouse and reporting tools deployed to every desktop, employees won’t feel part of the process, less informed decisions will be made, and no real change will happen.
I call this the big-bang theory of performance management. Recently I heard a speaker tell the timeless change management story of the frog in boiling water as justification for a big bang deployment. As the story goes, if you toss a frog into a pot of boiling water, it will jump out and live. But a frog placed in water that is slowly heated will sit complacently and boil to death. According to the speaker, the same principles apply to performance management. Without a shock to the system, stakeholders are unlikely to be goaded into improving performance.
The story made for a captivating keynote but I don’t believe the idea – or the story behind the frog. A frog dropped into boiling water will likely be shocked and killed nearly instantaneously while a slowly-heated frog will probably jump out of the pot when the water becomes too uncomfortably warm. Similarly, employees who are suddenly forced to track performance using KPIs and objectives that they don’t truly understand are likely to circumvent or sabotage the system. (See here for one amusing such story for CRM.)
In my experience, successful performance management requires change management, especially in those organizations that don’t have a history of linking individual pay to performance. I strongly recommend helping employees understand what the organization wants to accomplish (objectives) before publishing indicators of performance. Better motivated and aligned employees can solve performance problems (Sarasota County provides an example). In addition, one size doesn’t fit all. If your corporate color is red, you may not want to use a red stop sign to indicate poor performance.
By starting small, organizations can figure out what works best for them and increase the likelihood of long-term sustained success. Maybe that will keep them out of hot water.