Are you looking to revolutionise and modernise your performance management process? To spark ideas for positive change, we have highlighted some of our favourite examples of agile organisations.
As times evolve, so do the performance management systems. Modern, forward-thinking organisations recognise the necessity of adapting their processes and embracing performance management trends to stay competitive. The traditional approach to performance management – characterised by performance ratings, annual appraisals, and stack-ranking – is rapidly losing relevance. Increasingly, companies are shifting towards more agile performance management systems and are experiencing notable benefits in productivity, employee engagement, and morale.
We won’t sugarcoat it. Organisational change is challenging and requires significant effort. However, transforming your performance management system to be more agile will ultimately enhance performance and productivity for both your organisation and its employees.
Related: What is continuous performance management?
In this article, we will explore five dynamic, agile companies, examining how they enhanced their agility and the advantages they have gained from this transformation.
What is an agile Organisation?
An agile organisation is a company that swiftly adapts to changes in market conditions and workplace trends. These companies recognise that organisational change is inevitable, regularly assessing their practices and processes to foster optimal employee engagement, morale, and performance. Agile organisations effectively respond to new competitors with innovation, continually challenging themselves to evolve and adjust.
Characteristics of agile organisations
Agile organisations are distinguished from traditional companies by five key characteristics related to management and outlook. Generally, they are more goal-oriented, engaged in ongoing performance conversations instead of relying solely on annual appraisals, and maintain a forward-looking perspective at all times.
A deeper understanding of agile organisations can be gleaned from the following five characteristics:
- Shared purpose and vision: Agile organisations possess a unified mission and vision. They demonstrate flexibility in resource allocation and strategy, enabling them to sense and seize opportunities, which provides a competitive advantage.
- Flat structure: Typically, agile organisations feature a flat hierarchy. With clearly defined roles and hands-on managers, employees are empowered to fulfil their responsibilities and contribute meaningfully to the organisation.
- Commitment to transparency and continuous learning: These organisations embrace a “fall fast” mentality, welcoming experimentation. Even when experiments do not succeed, they are viewed as valuable learning opportunities.
- Encouragement of role mobility and entrepreneurial spirit: Engaged employees are eager to explore various facets of the company and contribute wherever possible. Agile businesses promote this mindset and drive.
- Prioritisation of effective, user-friendly technology: Agile organisation emphasises technology that facilitated decision-making communication, and feedback, ensuring processes are efficient and user-friendly.
Related Article: What’s the purpose of performance management?
Examples of agile organisations
1. Clydesdale and Yorkshire Bank
After and internal consultation process, Clydesdale and Yorkshire bank concluded that their performance management system was overly focused on processes and lacked purpose – primarily centred around ratings without yielding real improvements in performance.
As Francis Lake, Head of Organisational Development at CYBG, states,“Our performance management was quite process focused and we knew we needed to make changes to ensure there was continued improvement in performance and our staff were motivated and engaged in their career development.”
In response, CYBG implemented an agile continuous feedback program, supported by OneAdvanced’s Performance and Talent management software. Understandably, there was considerable apprehension about adopting a new system, especially after relying on the old one over a decade without seeing the desired outcomes.
The new approach began with simple, regular check-ins between managers and employees, accompanied by real-time feedback – eliminating the need for scorecards and time-consuming forms. Teams collaboratively established a set of key goals for the quarter, while each employee identified two personal development objectives to focus on over the next three months
Francis noted that the new process is markedly simpler in terms of its approach, procedures, and the language used. Remarkable, after just three months, the company observed promising results. With everyone aligned toward common company and team goals, they achieved greater objectives and saw enhancements in teamwork, and overall performance across the organisation, As Francis outs it:
“Our performance management approach is now focused on encouraging feedback conversations, creating stretch and improved teamwork. The technology is also giving us insight to drive more change and provide the foundations for good management.”
2. General Electric
General Electric (GE) famously undertook a performance management overhaul in 2015, setting a precedent for other global companies. After years of annual performance reviews and the notorious rank-and-yank system (which involves ranking employees and regularly dismissing the bottom 10%) GE recognised the need to revitalise its performance management approach. While the ranking system was eliminated, the annual appraisal lingered for another decade. Today, GE operates as a more agile organisation, experiencing significant improvements.
The new system emphasises managers guiding and coaching employees toward their goals within a more flexible framework. Additionally, GE introduced an app called PD@GE to facilitate ongoing employee feedback and productive performance conversations
Through the app, each employee sets a series of priorities and actively seeks insights and feedback. They can also provide real-time feedback to their colleagues. Employees are encouraged to request in-person meetings whenever necessary, focusing these discussions on transparency, honesty, and continuous improvement. Sonia Boyle, GE Canada’s vice-president of human resources, remarks:
“[It] requires a measure of trust and vulnerability […] These characteristics won’t appear overnight and will require a commitment to change and personal development.”
3. Cargill
Before its seismic shift in performance management in 2012, Cargill Inc., a global food producer and distributor, struggled to engage and motivate its workforce of 155,000 employees. In response, Cargill embraces the concept of an agile organisation, introducing what it referred to as “everyday performance management.” This system was based on four principles:
- Feedback should be continuous rather than sporadic and document-heavy.
- Daily activities and practices serve as predictors of the quality of performance management.
- The relationship between employees and managers is critical.
- Above all, the system must remain flexible and agile to respond to business needs.
This new approach aimed to foster daily, real-time feedback within its performance management framework. Since implementing this transition, Cargill has reported measurable improvements, shifting its focus from merely reviewing past performance to a more forward-looking perspective.
The results were impressive – 69% of employees stated they received feedback that was beneficial for their professional development, and 70% felt more valued following the rollout of the new system. From a performance standpoint, mangers observed employees dedicating more time to meaningful tasks instead of being bogged down by paperwork.
4. Adobe
We can’t discuss agile performance management without highlighting Adobe, a prominent example of performance management transformation. In 2012, Donna Morris, then Senior Vice President of People Resources, recognised that the annual performance appraisal and stack-ranking process were bureaucratic, cumbersome, and overly complicated, consuming excessive management hours. She noted that this system hindered teamwork, creativity, and innovation.
The Adobe team decided to eliminate annual performance appraisal in favour of regular, ongoing performance discussions between managers and employees, implementing a system they termed “Check-in”. Since this shift, Adobe has successfully reduced voluntary turnover by 30%, while involuntary departures increased by 50%, indicating that underperforming hires were managed out more efficiently. Additionally, the company saved 80,000 management hours annually.
5. Accenture
Accenture discovered that under their previous system, “employees that do best […] tend to be the most narcissistic and self-promoting.” To foster genuine contributions to the organisation, they sought to overhaul their system by encouraging ongoing performance conversations and refocusing on performance development.
Accenture concluded that forced ranking was illogical, as it compelled employees to compete against colleagues in entirely different roles. This new approach prioritises the individual employee, guiding them to become the nest version of themselves.
Discover how OneAdvanced Performance and Talent can assist you
If you are looking to implement performance management software designed for agile organisations, reach out and book a demo of Clear Review today.