What Matters?

That�s right, isn�t it?

Now, lets assume that all of your employees are proficient . . . every single one. Can you be relatively certain that your business will reach the goals you have set for it this year? How about in five years?

This question may cause you to pause and consider your bewilderment. We don�t often consider the connection between individual performance appraisal and firm performance. That�s one of the reasons we dismiss performance appraisal as a nuisance and put off reviews as long as we can, and that�s one of the oddities of organizational life that for years has attracted the attention of researchers who want to help.

It appears, they say, that typical performance evaluation systems examine behaviors that are easy to measure and ignore behaviors that matter, i.e. behaviors that impact firm growth and survival. It appears, they go on, that managers are throwing away a tool they could be using to make progress. Mark Griffin, from the University of Sheffield in Australia, is one of these researchers, and he recently made a contribution that will help us.

Griffin recognized two challenges most firms must face. The first is interdependence. People must work together to accomplish useful goals. The second is uncertainty. Conditions of business are constantly changing, evolving, and firms who wish to stay in business must continually rediscover the contribution they have to make.

Griffin examined the research and innovations in performance appraisal from the last fourteen years, and he noted that many people had tried to incorporate these twin challenges of interdependence and uncertainty into their revised systems. He also noted obvious deficiencies in this earlier work, so he set out to correct them. He created a coherent framework for performance appraisal that addresses these challenges, and he tested this revised framework. He completed a study involving three firms totaling 491 supervisors and 2,155 employees, and he was satisfied that his improvement would help the firms that adopt it.

Griffin�s system identifies three dimensions of work. The first is proficiency. Proficiency describes the extent to which an employee performs clear work functions. Typically, these are the formalized job functions that currently appear on everyone�s performance appraisal forms. Griffin categorized proficiency functions as easily formalized because correct behaviors can be described and measured.

Griffin�s second and third dimensions of work are not easily formalized, described, or measured. The second category is adaptivity. The third is proactivity. Many correct behaviors in these categories aren�t even recognized until after they�ve been performed.

Adaptivity describes the extent to which an employee quickly and easily adapts to changes in a work system or work role. Proactivity describes the extent to which an employee shows initiative, taking self-directed actions to begin a needed change in a work system or work role. Such behaviors often anticipate needs, taking advantage of emerging opportunities or preventing problems from causing harm.

Adaptivity and proactivity are impossible to formalize. You can�t specify in advance exactly what you want people to do, but Griffin insists this shouldn�t deter you from making it part of your performance appraisal process. You can point out examples of these dimensions of work when you recognize them. Including them in your performance review process will allow you to stimulate and regulate these behaviors in the future.

Griffin also recommends that you divide these three dimensions of work into three settings in which they can be employed: individual work, group tasks, and the organization as a whole. If you draw a large rectangle with three rows and three squares in each row, you can see the scheme Griffin has in mind. Label each square with one of the dimensions and one of the settings. For example, proficiency/individual, proficiency/group, and proficiency/organization would occupy boxes in the top row. Adaptivity/individual, adaptivity/group, and adaptivity/organization would occupy the second row, and proactivity/individual, proactivity/group, and proactivity/organization would occupy the third row. As you prepare to review performance with an individual, you would examine these boxes and think of examples from this person�s experience in the reporting period that would fit in each one. You would also assign importance ratings. You would impress upon the person the need for such behaviors at this time in your setting.

In order to stay in business, firms must identify, encourage, and reward employees who are helping our firms make progress, especially those who can successfully manage the twin challenges of working elegantly together as a team and quickly adapting to changes in the factors that impact our businesses: new technology, changing customer preferences, changing organizational structures, foreign competition, and so on. Performance appraisal allows us to get more of what we need from our people. Now, thanks to Professor Griffin, we have a way to do this.

Reference: Griffin, Mark A., Andrew Neal, and Sharon Parker (2007) A New Model of Work Role Performance: Positive Behavior in Uncertain and Interdependent Contexts. Academy of Management Journal, 50(2), 327-347. www.businesspsych.org

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