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reinventing performance
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Reinventing Performance Management at Deloitte

Wednesday, January 13, 2016
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Deloitte didn’t originally set out to reinvent performance management. Really. When we got started, that was not our intent. The work was a natural outgrowth of other work we were doing in talent development, but has become foundational to how we are reshaping our culture as we grow our next generation of leaders.

It was 2011, and we had just cut the ribbon on the doors to Deloitte University—our 100-acre learning facility nicknamed “The Leadership Center.” This brick-and-mortar investment created a call to action for our talent development organization to redefine our strategy and to ensure that what we were doing inside all of Deloitte’s walls was driving the engagement and performance of our people and teams.

Like many strategy refreshes, ours began with research. We looked at external studies on high performance and development, and we conducted our own empirical study on the characteristics of high-performing teams at Deloitte. We were overwhelmed by one of our findings: performance, retention, and client satisfaction are strongly predicted by our people’s beliefs they are playing to their strengths.

This study was based on long-term research by Gallup, who studied 1.4 million individuals in high-performing teams across 192 organizations. Ours explored conditions on more than 60 high-performing Deloitte teams, comparing them to a baseline that included approximately 2,000 employees. It also reinforced our belief in strengths-based development—this notion that each of us can best contribute, grow, and differentiate our firm when we focus on our strengths.

So we asked ourselves what we were doing to deliver strengths-based development at Deloitte, and what might be getting in its way. We saw lots of bright spots, and we also began to see that our approach to performance management was no longer the best design for Deloitte’s emerging needs. What we saw in the research, as well as what we knew about how our business was evolving, called to question whether the process and philosophy we had relied on for years would be enough to propel the next generation of performance at Deloitte.

Setting Our Objectives

To build our future model, we started with another seemingly simple question: What is the purpose of performance management at Deloitte? This is one of those questions that if you ask several people you might get several answers. And we did just that. We conducted focus groups across the firm, and, from that feedback—and crystalized three primary purposes for performance management.

Many said performance management should enable us to RECOGNIZE performance. The system should drive annual activities that allow intelligent compensation, promotion, and low-performer management decisions.

But our people wanted more. Next, we heard that performance management should enable us to really SEE performance—to generate a rich stream of information that gives business leaders a view into the performance of their organizations. How does performance trend differently in different organizations? Who are our best performers? Who needs improvement? And what can individual leaders do to influence them all?

Which gets us to our final objective: FUEL performance. The purpose of a system to manage performance should be to create more of it—performance, that is. We’re all in business which, whether for profit or for purpose, has a bottom line that’s driven by the performance of our people. So we had to find a way to drive this in real time, on the teams, where the work happens, every day.

Fueling Performance

From emerging research, we know that an effective way to drive performance is through conversations. So, we created “check-ins”: frequent, future-focused conversations about the work. Here, team members and team leaders meet 1:1 to explore real-time feedback and expectations for the near-term work. It’s how they align on priorities for what’s coming next, and they do that with a strengths lens. They discuss how the individual will deliver on these priorities given their unique skills and strengths, and how the team leader will create opportunities for them to do that.

We called them frequent, but we didn’t mandate a frequency. We left this up to business leaders to communicate as they saw fit. Today, the majority of our people are doing them either weekly or biweekly.

We also didn’t require anyone to document anything going into or coming out of a check-in. We didn’t want anything to stand in the way of the conversation.

We stressed that the logistics of check-ins are not as important as making them a habit. The tone, nature and content of a check-in should evolve over time, differing from person to person, engagement to engagement, project phase to project phase, and week to week. There was no heavy training or how-to guides. To launch check-ins we did just two things:

  • We gave people prompts to spark conversations. 
  • We began sending out a simple weekly email with a Yes/No voting button and one question: “Did you have a check-in conversation with your team leader this week?”

What’s interesting, though, is that we didn’t use this data to monitor compliance, follow up with those who weren’t doing them, or reward those who were. We just looked at it on aggregate to understand organization-wide check-in behavior and its impact.
Our people who were used to heavy investments twice per year were now expected to shift that time to the location where the work—the performance—was happening in real time. We changed the notion that performance management is that thing you take time off from the work to do. Currently, check-ins are part of how our people get their work done.

Seeing Performance

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Moving away from ratings didn’t mean we’d stop capturing performance data. For us, it just meant we’d now capture a different type of data. We designed several components that enable us to see the performance of our people and teams. I’ll focus here on just one: the Performance Snapshot.

Fundamentally, a performance management system needs a way to evaluate performance. What’s more, we know intuitively that the person with the most first-hand knowledge of someone’s performance is his or her team leader. So, the Performance Snapshot is a vehicle for the team leader to capture his or her assessment about each team member’s performance, at a moment in time.

Snapshots are timely, completed at the end of a project, phase, or at least quarterly—allowing team leaders to capture their judgement of performance as close as possible to when it occurs. By the end of the year, there are numerous snapshots completed for each person so that the work our people do ALL year is captured.

Snapshots are research-based. Rather than ask leaders to rate the skills of others, we’ve crafted questions that ask them to rate their own intended future actions. This approach counteracts the idiosyncratic rater effect, which research has shown distorts ratings because the main variable is the evaluator. Leaders in the new system make decisions based on what they know about a team member’s performance instead of what they think of the person.

Snapshots are easy. Our Performance Snapshots use four questions, answered on a Likert-type scale; no more paragraphs to write. We’ve even given folks mobile access to make these as simple as possible for our on-the-go workforce, to enable an ongoing flow of data throughout the year.

Recognizing Performance

So now that we’ve got all this data, what do we do with it? In short, the data is aggregated, and reviewed quarterly to give business leaders a holistic view of performance in their organizations. Every quarter HR sits down with individual business leaders to review a scatterplot that plots Performance Snapshot results.

Now, this isn’t the only thing they look at. They also can see who has been flagged at-risk for low performance, or who has been identified by at least one team leader as ready for promotion. They also look at important business measures per person, like revenue.

We ask our business leaders to integrate all of this data to make their own judgements to drive key talent decisions. See that’s the thing that makes this different from a single summative rating. In real life there are lots of things we know about people. When you review a job application, or follow a baseball player, or evaluate your latest lab results, you consume and integrate several data points to make a set of decisions about how to act.

With this design, we’re trying to bring that nuanced presentation of a person to Talent Management. Now, there are lots of things we know about you: we know what your local team leaders thought they might do based on what they observed of your performance, and we also know how you’ve performed against your business metric goals, the activities through which you’ve contributed to the community, and more. We ask our leaders to take all of it into account when making decisions. Our task in HR is to find a consumable way to present it. And the task of the leaders is to make intelligent decisions with it.

So that’s our model. Built on three objectives, with several components, that operate independently, but also reinforce one another to create an ecosystem of performance. I’ve only covered two features here, but it also includes:

  • Team Pulse survey that provides team leaders with insights about the engagement of their teams to drive team conversations around how to increase it
  • low -performer management approach that, due to the timeliness of the Snapshots, generates more real-time attention for those at risk
  • talent reviews in which panels of leaders plan investments in the career development of select talent segments
  • career coach who helps employees discover their strengths, find more ways to play to them, explore performance trends across experiences, and develop their careers.

What’s Next for Performance Management?

Deloitte has been at this for two years, and we now have data that indicates the design is having a positive impact. Our approach has evolved over the various pilots, and it will likely continue to evolve as we expand and learn. We’ve pursued a measured testing and implementation approach, rather than a big bang.

When we completed the first iteration of the design two years ago, we didn’t go to leadership and ask for a vote. All we asked for was permission to test the model—first in small populations, and then bigger ones. We used it with 2,000 people, then 7,000 people, then 40,000 people, and now more are opting-in, business by business.

Next up, Deloitte will begin looking past implementation and toward optimization. This shifts our efforts beyond “what is the process?” to “How do I optimize my role inside the model?’ How do i position team members, team leaders, coaches, and business leaders to take best advantage of the tools included in this model to do their jobs better? Optimization puts a focus on creating a new generation, with a new strengths mindset, and new skills and insights to fuel the performance and engagement of their people and teams.

Finally, let’s not forget what this approach has done for our talent professionals. This work is not just changing how our people and their leaders operate, but also how HR enables them. The integrated nature of this design is breaking down silos between previously distinct HR disciplines of performance management, talent management, leadership development, and employee engagement by generating a new set of analytics that we can consume about our people and teams that integrates them all. This work demands sophistication from all of us, but also creates amazing opportunity to deliver ongoing insights that will change the way our leaders think about leadership.

So, no, Deloitte did not originally set out to reinvent performance management. But we’re awfully glad we’ve started.

About the Author
Erica L. Bank is Deloitte’s performance management leader. She provides strategic direction to the work to optimize the performance of Deloitte’s people and teams, and has been a key leader in the firm’s recent performance management reinvention efforts. Prior to this role, she spent more than a decade in Deloitte’s human capital consulting practice, where she advised clients through strategic talent management strategy, process, and technology transformations.
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Are you able to provide some more tools you used . If you are able of course.
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Any chance you can share what organization Deloitte has partnered with to deliver this talent management platform?
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