High-Performance Management In A Nutshell

High-performance management involves the implementation of HR practices that are internally consistent and aligned with organizational strategy. Importantly, high-performance management is a continual process where several different but integrated activities create a performance management cycle. It is not a process that should be performed once a year and then hidden in a filing cabinet. 

High-performance management origin story

High-performance management as most recognize it today has only existed for around 100 years or so. 

Taylorism and principles of scientific management

Engineer and management consultant F. W. Taylor was one of the first to research the link between employee potential and productivity. In 1908, he developed scientific management principles that:

  1. Replaced “rule-of-thumb” work processes with those based on the scientific study of the tasks involved.
  2. Selected, trained, and developed each employee instead of leaving them to train themselves.
  3. Created a collaborative environment with employees to ensure scientific methods were being followed.
  4. Divided work between managers and employees in such a way that management could incorporate these principles into planning.

Henry Ford was an early proponent of Taylor’s performance management system. He divided vehicle manufacture into simple, repetitive tasks that any factory worker could learn.

Taylor’s performance appraisal model

In 1914, Taylor then introduced a formal performance appraisal model with a core focus on improving employee productivity. This time, he considered the experience, punctuality, loyalty, and personality of the employee as opposed to organizational objectives.

W.D. Scott

One of the earliest documented uses of performance appraisals can be seen in Australian company WD Scott & Co. As early as 1914, the management consultancy firm introduced an employee comparison scale that was influenced by Taylor’s earlier work.

However, this more formal appraisal system was largely unknown outside of the company until the 1930s. When improved labor agreements and government practices became established in the 1950s, an annual performance appraisal based on Scott’s original system was instituted in organizations around the world.

A shift to aspirational performance management

Until the 1960s, performance management was based on an employee’s personality traits which had little to do with their productivity in the workplace.

In response, organizations started to focus on what employees may be able to achieve in the future with emphasis given to goals and objectives. It was around this time that the management by objectives approach became popular, a system first proposed by Peter Drucker in 1954.

Further refinement

In the 1970s, high-performance management was often associated with court battles because of the subjective and biased nature of appraisals. This precipitated a shift toward performance rating scales and psychometrics, with further enhancements such as 360-degree feedback introduced in the 80s and 90s.

360-degree feedback was different in that it focused on employee motivation and engagement as a tool to increase performance. Concepts such as teamwork, conflict resolution, efficiency, and communication became the defacto measurements of choice.

Future of high-performance management

Today, many organizations have ditched annual performance appraisals with a more frequent or continuous strategy now common. Employee motivation and engagement are considered in the context of positive and productive workplace culture.

Moving forward, the role of artificial intelligence in human resources is likely to shift the focus from quantity to quality. In other words, the quality of employee feedback will supersede the frequency of appraisals between the employee and their superior. Feedback itself will also become more flexible, contextual, and less complicated.

Understanding high-performance management

Performance management is often seen as the weakest part of human capital management by employees and managers alike.

Indeed, performance management rarely results in improved performance. This is despite the fact that it is a resource-intensive exercise. Employees are often left feeling deflated, unmotivated, and disengaged. Managers become frustrated at a distinct lack of buy-in and the resultant poor performance levels. Alarmingly, research has shown that only 14% of organizations are satisfied with their current performance management system.

The situation is made more difficult because of a lack of clarity on what constitutes high-performance. However, author Michael Armstrong provides a useful definition. He notes that “performance management is the continuous process of improving performance by setting individual and team goals which are aligned to the strategic goals of the organization, planning performance to achieve the goals, reviewing and assessing progress, and developing the knowledge, skills, and abilities of people.

Importantly, high-performance management is a continual process where several different but integrated activities create a performance management cycle. It is not a process that should be performed once a year and then hidden in a filing cabinet. 

The high-performance management cycle

Microsoft, General Electric, Adobe, and Deloitte are examples of companies that have abandoned once-a-year performance appraisals and adopted a more cyclical model.

This model incorporates the following elements:

  1. Plan. Here, the focus is on developing SMART objectives (aligned with organizational goals) and a personal development plan. Employee job requirements should be evaluated and updated where necessary.
  2. Act. The employee should then carry out their role and achieve stated objectives. The personal development plan should be implemented.
  3. Track. Progress should be tracked regularly with regular feedback or coaching given to address obstacles. Some suggest that feedback should be given once every quarter to ensure employees are given the time and necessary support to achieve their goals.
  4. Review. At this point, the employee and HR manager should reflect on what they have learned and review past achievements. Career goals and future actions should be discussed and agreed upon.

Basic elements of high-performance management

To encourage high-performance, HR managers should consider these building blocks:

  • Goal setting – goals need to be set as early as practicable. To increase engagement and empowerment, the employee must be made aware of why their goals matter. How are they furthering organizational and personal objectives?
  • Transparent communication and collaboration – employees must be shown the respect of being kept in the loop at all times. If the company is enduring hardship, they should be informed. They should also be kept abreast of important information and given the chance to build collaborative relationships with their co-workers and managers. Transparency also means that both parties never shy away from raising difficult or uncomfortable topics.
  • Recognition – high-performance can be bolstered via incentivization. This can take the form of a bonus or an award but if nothing else, every employee should be told that their work is valued and appreciated.
  • Honest and regular feedback – the more frequent and concise the feedback, the higher the employee performance. 
  • Employee development – if an organization is succeeding at high-performance management, then it will naturally produce employees who want to further their own ambitions. Businesses should invest in their staff and not be afraid to lose important talent to a competitor.

Key takeaways

  • High-performance management encompasses a suite of HR practices. These practices have a focus on the continual improvement of employee and organizational performance.
  • A cyclical high-performance management approach has been adopted by several large companies including Adobe, General Electric, and Deloitte.
  • High-performance management occurs when employees set goals they are empowered to achieve. Transparent communication, recognition, regular feedback, and employee development are also crucial.

Key Highlights

  • Definition and Purpose:
    • High-Performance Management involves implementing internally consistent HR practices aligned with organizational strategy.
    • It’s a continual process that forms a performance management cycle, not a one-time event filed away.
  • Origin and Evolution:
    • High-Performance Management emerged around a century ago.
    • Frederick W. Taylor introduced scientific management principles in 1908, focusing on task efficiency and collaboration.
    • Taylor’s performance appraisal model considered employee experience, punctuality, loyalty, and personality.
    • Performance appraisals gained traction in the 1930s, influenced by Taylor’s ideas.
    • Shifting to the 1960s, focus transitioned from personality traits to future achievements with the rise of management by objectives.
  • Refinement and Modernization:
    • The 1970s brought performance rating scales and psychometrics to address appraisal subjectivity.
    • 360-degree feedback emerged in the 80s and 90s, focusing on motivation, teamwork, conflict resolution, and communication.
    • Today, high-performance management emphasizes frequent feedback, engagement, and a positive workplace culture.
    • Artificial intelligence is expected to enhance feedback quality and flexibility in the future.
  • Understanding High-Performance Management:
    • Traditional performance management often results in dissatisfaction and poor performance.
    • Only 14% of organizations are satisfied with their current performance management systems.
    • Author Michael Armstrong defines performance management as a continuous process aligned with organizational goals.
    • High-performance management is not a one-off process but a continuous cycle of activities.
  • High-Performance Management Cycle:
    • Organizations like Microsoft, General Electric, Adobe, and Deloitte have shifted to cyclical models.
    • The cycle includes Plan, Act, Track, and Review stages.
    • Goal setting, transparent communication, collaboration, recognition, regular feedback, and employee development are critical elements.

Read Next: Eisenhower Matrix, BCG Matrix, Kepner-Tregoe Matrix, Decision Matrix, RACI Matrix, SWOT Analysis, Personal SWOT Analysis, TOWS Matrix, PESTEL Analysis, Porter’s Five Forces.

Connected Leadership Concepts And Frameworks

Leadership Styles

Leadership styles encompass the behavioral qualities of a leader. These qualities are commonly used to direct, motivate, or manage groups of people. Some of the most recognized leadership styles include Autocratic, Democratic, or Laissez-Faire leadership styles.

Agile Leadership

Agile leadership is the embodiment of agile manifesto principles by a manager or management team. Agile leadership impacts two important levels of a business. The structural level defines the roles, responsibilities, and key performance indicators. The behavioral level describes the actions leaders exhibit to others based on agile principles. 

Adaptive Leadership

Adaptive leadership is a model used by leaders to help individuals adapt to complex or rapidly changing environments. Adaptive leadership is defined by three core components (precious or expendable, experimentation and smart risks, disciplined assessment). Growth occurs when an organization discards ineffective ways of operating. Then, active leaders implement new initiatives and monitor their impact.

Blue Ocean Leadership

Authors and strategy experts Chan Kim and Renée Mauborgne developed the idea of blue ocean leadership. In the same way that Kim and Mauborgne’s blue ocean strategy enables companies to create uncontested market space, blue ocean leadership allows companies to benefit from unrealized employee talent and potential.

Delegative Leadership

Developed by business consultants Kenneth Blanchard and Paul Hersey in the 1960s, delegative leadership is a leadership style where authority figures empower subordinates to exercise autonomy. For this reason, it is also called laissez-faire leadership. In some cases, this type of leadership can lead to increases in work quality and decision-making. In a few other cases, this type of leadership needs to be balanced out to prevent a lack of direction and cohesiveness of the team.

Distributed Leadership

Distributed leadership is based on the premise that leadership responsibilities and accountability are shared by those with the relevant skills or expertise so that the shared responsibility and accountability of multiple individuals within a workplace, bulds up as a fluid and emergent property (not controlled or held by one individual). Distributed leadership is based on eight hallmarks, or principles: shared responsibility, shared power, synergy, leadership capacity, organizational learning, equitable and ethical climate, democratic and investigative culture, and macro-community engagement.

Ethical Leadership

Ethical leaders adhere to certain values and beliefs irrespective of whether they are in the home or office. In essence, ethical leaders are motivated and guided by the inherent dignity and rights of other people.

Transformational Leadership

Transformational leadership is a style of leadership that motivates, encourages, and inspires employees to contribute to company growth. Leadership expert James McGregor Burns first described the concept of transformational leadership in a 1978 book entitled Leadership. Although Burns’ research was focused on political leaders, the term is also applicable for businesses and organizational psychology.

Leading by Example

Those who lead by example let their actions (and not their words) exemplify acceptable forms of behavior or conduct. In a manager-subordinate context, the intention of leading by example is for employees to emulate this behavior or conduct themselves.

Leader vs. Boss

A leader is someone within an organization who possesses the ability to influence and lead others by example. Leaders inspire, support, and encourage those beneath them and work continuously to achieve objectives. A boss is someone within an organization who gives direct orders to subordinates, tends to be autocratic, and prefers to be in control at all times.

Situational Leadership

Situational leadership is based on situational leadership theory. Developed by authors Paul Hersey and Kenneth Blanchard in the late 1960s, the theory’s fundamental belief is that there is no single leadership style that is best for every situation. Situational leadership is based on the belief that no single leadership style is best. In other words, the best style depends on the situation at hand.

Succession Planning

Succession planning is a process that involves the identification and development of future leaders across all levels within a company. In essence, succession planning is a way for businesses to prepare for the future. The process ensures that when a key employee decides to leave, the company has someone else in the pipeline to fill their position.

Fiedler’s Contingency Model

Fielder’s contingency model argues no style of leadership is superior to the rest evaluated against three measures of situational control, including leader-member relations, task structure, and leader power level. In Fiedler’s contingency model, task-oriented leaders perform best in highly favorable and unfavorable circumstances. Relationship-oriented leaders perform best in situations that are moderately favorable but can improve their position by using superior interpersonal skills.

Management vs. Leadership


Cultural Models

In the context of an organization, cultural models are frameworks that define, shape, and influence corporate culture. Cultural models also provide some structure to a corporate culture that tends to be fluid and vulnerable to change. Once upon a time, most businesses utilized a hierarchical culture where various levels of management oversaw subordinates below them. Today, however, there exists a greater diversity in models as leaders realize the top-down approach is outdated in many industries and that success can be found elsewhere.

Action-Centered Leadership

Action-centered leadership defines leadership in the context of three interlocking areas of responsibility and concern. This framework is used by leaders in the management of teams, groups, and organizations. Developed in the 1960s and first published in 1973, action-centered leadership was revolutionary for its time because it believed leaders could learn the skills they needed to manage others effectively. Adair believed that effective leadership was exemplified by three overlapping circles (responsibilities): achieve the task, build and maintain the team, and develop the individual.

High-Performance Coaching

High-performance coaches work with individuals in personal and professional contexts to enable them to reach their full potential. While these sorts of coaches are commonly associated with sports, it should be noted that the act of coaching is a specific type of behavior that is also useful in business and leadership

Forms of Power

When most people are asked to define power, they think about the power a leader possesses as a function of their responsibility for subordinates. Others may think that power comes from the title or position this individual holds. 
Tipping Point Leadership is a low-cost means of achieving a strategic shift in an organization by focusing on extremes. Here, the extremes may refer to small groups of people, acts, and activities that exert a disproportionate influence over business performance.

Vroom-Yetton Decision Model

The Vroom-Yetton decision model is a decision-making process based on situational leadership. According to this model, there are five decision-making styles guides group-based decision-making according to the situation at hand and the level of involvement of subordinates: Autocratic Type 1 (AI), Autocratic Type 2 (AII), Consultative Type 1 (CI), Consultative Type 2 (CII), Group-based Type 2 (GII).

Likert’s Management Systems

Likert’s management systems were developed by American social psychologist Rensis Likert. Likert’s management systems are a series of leadership theories based on the study of various organizational dynamics and characteristics. Likert proposed four systems of management, which can also be thought of as leadership styles: Exploitative authoritative, Benevolent authoritative, Consultative, Participative.

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