Explore Alternatives Now! - Performance Management In The Multi-dimensional Digital World

Earlier, business was not quite as dynamic, employment was intended for the long-term, and the idea of pay linked to performance was quite a defendable model. But as we examine the tradition of performance management in light of today’s digital business models, there are a number of new questions that emerge

- Richard Smith

While there have been a number of questions about the annual performance appraisal over the last several years, many firms decided to totally abandon the decades of tradition that lay at the core of many HR processes. In 2015, Deloitte made headlines when they reviewed the evidence and considered the value of the process relative to the time involved across the management teams. Other firms like Accenture, GE and Microsoft have also taken similar actions. While there seems to be a rally-cry for abandoning the annual appraisal, it seems that it might indeed is time to rethink the entire concept of performance management in light of our digital era.

Many of the HR systems and processes can be traced back to the industrial revolution when management needed systems to manage employees on a large scale. The rise of unions and workers councils required fair and consistent processes in organizations. Having a clear performance rating that was determined each year as a basis for then awarding incremental pay raises and promotions was a simple way of organizing management actions. The business was not quite as dynamic, employment was intended for the long-term, and the idea of pay linked to performance was quite a defendable model.

As we examine the tradition of performance management in light of today’s digital business models, there are a number of new questions that emerge. Computer engineers are familiar with the fact that in the physical world, we deal with three dimensions, but in the digital world, we can create complex relationships across many dimensions. As we consider performance management, we ask ourselves new questions related to time, relationship, job, employment, human, diversity, and progression. Let’s take a closer look at each of these dimensions.