Performance management and Gen Y: feeding the feedback fervour

After just a few weeks working for one firm, Generation Y employees can become easily bored and may look to leave if they are not managed effectively. They crave constant feedback and close contact with their managers. So how can organisations adapt current performance management processes to the now-generation? Louisa Peacock reports.

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It can take as little as two months of no feedback from the boss, being left out of decision making or having ideas ignored to drive Gen Yers to quit their jobs, according to Row Henson, human capital management specialist at software firm Oracle. The challenge of how to manage this needy group of people is therefore not so much ‘how can they adapt quickly to our organisation’ but ‘how can our organisation adapt to them?’.

Traditional performance management systems, which revolve around measuring an employee’s achievements against a set list of objectives in an appraisal meeting, are simply outdated, Henson reckons.

“What we have done with performance management systems in the past has been very siloed. So managers think: ‘we want X skills, where do these come from, what age bracket are we looking for?’,” she says.

While set objectives and annual appraisal meetings go some way towards managing employees, they don’t really give the full picture when it comes to engaging staff throughout the year.

Limiting potential

Just relying on yearly appraisal meetings could limit an employee’s potential, because it forces them to work to a pre-defined set of tasks without taking into account what they are capable of. “It creates a performance expectation of ‘here’s your role, and here’s how we can close our skills gap’,” says Henson.

As Angela O’Connor, chief people officer at the National Policing Improvement Agency (NPIA), views it, the task of delegating work to staff should be a two-way process between employee and manager. The agency, which came about from a merger in April 2007 to improve police training and technology, now has about 90% of its 2,000 staff on the same terms and conditions. But the agency did not force managers to hand out new job descriptions to staff for fear it would restrict individuals’ capability, O’Connor says.

“I’ve no interest in what job descriptions say because they’re shoved in a draw somewhere and locked away. I think the emphasis has to be much more on what people are doing. They know their grade and they get paid accordingly. I’d be ever so unhappy if people got out their job descriptions and said ‘this is my description and I’m only doing this’,” she says.

Concentrating on a set list of tasks and responsibilities can also create unintentional boundaries when it comes to the annual appraisal meeting, according to Paul Reynolds, HR director at catering giant Elior. He says both the individual and the manager refrain from talking about any other aspects of work which the employee might be interested in as they are busy ‘ticking off’ progress against predetermined duties.

“The annual appraisal meeting is too process-orientated and constrained. You’re asking and getting answers to questions that come from a very set agenda. Depending on the seniority and experience of the manager, they may not feel obliged to talk beyond that,” he says.

Money on the mind

What’s more, Reynolds argues, Gen Y employees are bound to be preoccupied in the annual assessment thinking about how their performance over the past year will affect their yearly pay rise.

“Whether an organisation admits it or not, there is an inextricable link in an individual’s mind between the annual appraisal meeting and yearly pay review. This means the employee will be quite strong in their opinion as to how well they have done.”

Elior does use a formal, yearly appraisal system, complemented with a mid-year assessment, but Reynolds stresses they are by no means the only way of finding out how an employee is performing.

“If you’re leaving it a year before you talk to someone about how they’re doing, there will undoubtedly be surprises there. The manager also has to talk about a year’s worth of performance but actually tends to focus on the last six to eight weeks because that’s what they can remember. So when the employee asks for an example of their work, good or bad, it will tend to be the last project they’ve worked on as opposed to the one they did last January which has been forgotten.”

O’Connor believes the only way to get round this is to talk to staff regularly – and informally – about how they are doing, and where there could be room for improvement.

Feeling valued

Like Reynolds, O’Connor sees formal and annual appraisals as just a small part of managing the employee’s performance – and encourages teams to seek feedback and input from their staff throughout the year.

“I see my staff on a regular if not daily basis, so by the time we get to appraisals there should be no big surprises. Formal appraisals are just one part of giving the employee feedback,” she says.

But making staff feel valued is the same for all age groups, not just Generation Y, warns Janet Hobgen, talent and organisation strategy director at consumer goods company Diageo.

Having recently won the Most Popular Graduate Recruiter 2008 in Ireland for the second year running, Hobgen knows it is just as important to treat younger people the same as any other staff demographic.

“We don’t treat Generation Y any differently to other workers they’re not a privileged set of people who we do an extra set of things for. Whilst attitudes among Generation Y may have prompted changes in various things we do – including expectations on flexible working or constant feedback – actually that’s no different to the expectations of other employees.”

Hobgen says internal research years ago found that all employees – not just Generation Y – wanted regular recognition and involvement in decision making. While the firm, which employs 23,000 people worldwide including 8,000 in the UK, has a formal, annual appraisal system, complete with an interim assessment mid-year, it provides training to its people managers to teach effective ways of managing performance and developing employees all year round.

About 120 senior managers, including the chief executive, run face-to-face internal briefings with fairly large groups of staff throughout the year, to foster an open culture of engagement.

Understanding employees

Reynolds says roughly 200 managers at Elior, which employs 12,000 staff in the UK, have also taken part in a coaching programme to help understand how they come across when managing others. But, he adds, it’s the simple things – particularly giving face time to employees – which can really make a difference to individuals.

“From a management perspective, it’s asking how people are, giving them time. It’s about having an open-door policy – both physically and metaphorically,” he says.

Yet head of resourcing at supermarket giant Tesco, Lorna Bryson, wants to go one step further. She says company managers must also have a thorough understanding of what Generation Y is before giving them that face time.

“It’s about helping managers to understand the needs of a young person. They are high maintenance – needy – and want to know where their career is going. When I left school, I did whatever my manager asked. Now, the younger generation has some great ideas, but we need to get those out of them,” she says.

Just under 10% of Tesco’s 250,000 employees are aged 17-24. Tesco management teams have weekly, face-to-face meetings with staff to enable ideas to be bounced off each other.

Online communities

Web 2.0 technology is an increasingly popular tool for encouraging manager-employee interaction. It allows staff to comment on corporate articles or chat to employees about company policies. Earlier this year, Reynolds changed his weekly update email to his team to a blog format, whereby staff can anonymously post feedback and ask questions.

He encouraged his leadership team, including the chief executive, to contribute to the online blogs to stimulate conversation across staff levels. In fact most articles on Elior’s intranet are now designed to encourage interactivity between employees and management, he says.

“It can be quite scary getting comments, if you ask for them, you might get some back that are quite negative. But your team enjoy the fact they’ve had the opportunity to comment, and you’re engendering this feeling of being valued.”

But Henson believes Web 2.0 technology can go even further to create online communities that Generation Y expect to be part of in the office, which in turn helps with employee engagement and retention.

“Generation Y are more interested in their networks than they are in their employer. So if you interview a cohort of graduates, for example, they look for ways to work together. Organisations need to leverage networking technology to support this (eg Facebook).”

Being flexible

Yet while separate generations might expect to see different communications tools in action in the workplace, HR needs to create flexibility in how to get the most out of all age groups. After all, he says, it’s no surprise to argue that every employee, no matter what their background, wants the chance to feel valued at work.

Henson adds: “HR needs to build in flexibility and adaptability. Yes, Generation Y want a healthy work-life balance, but so do ‘baby boomers’. You need to create a working environment that motivates every generation.”

O’Connor agrees that managers must be willing to find out what method works best for their teams, regardless of background or age. “You can’t communicate enough [to engage them], but it’s finding mechanisms for people that work – whether that’s through internal papers like the staff magazine, or core team briefings.”

Indeed, she insists, the core elements of good people management – effective communication, constant feedback and flexibility with workloads – appeal to any generation, no matter what age or background.

Tips for managing Generation Y performance

  • Spell out how their role fits into wider organisational goals
  • Create a development plan with clear career/succession planning
  • When giving feedback on individual projects, include input from multiple sources such as customers or colleagues, not just their line manager
  • Offer different ways of rewarding a job well done, eg allowing time-off with salary sacrifices
  • Provide a mentoring programme for staff to meet and work with top management
  • Harness online technology including blogging, interactive articles and chat rooms between employees and managers to encourage an open culture
  • Coach people managers in how they can engage their staff
  • Give constant feedback about work, informally and formally. Don’t wait until the annual appraisal to find out how they are doing.

Source: Oracle and Elior

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