The cycle of development in performance management

Developing people is the part of management everyone agrees matters and few organisations run deliberately. The question underneath it is how you keep someone engaged and improving while keeping their work pointed at where the company is going.

What development actually is

A joint effort between a manager and an employee to create opportunities to learn new skills, sharpen existing ones and build experience. Joint is the operative word. Development imposed on someone produces attendance; development agreed with them produces effort.

The returns are not subtle. Morale and engagement rise, productivity follows, people stay longer, and the expertise the organisation has accumulated stays inside it. The alignment benefit matters just as much: a person developing toward where the company is heading is worth more than one developing in an interesting direction of their own.

The cycle

Understand what motivates the person

Not what motivates people generally. Development built on an assumption about someone's drivers usually misses.

Cascade the business objectives into personal goals

So the individual's development connects visibly to the organisation's direction rather than running parallel to it.

Find the capability gaps

The appraisal is where this surfaces, which is one of the few things the annual review does well.

Keep the plan flexible

Roles change, particularly in growing companies. A development plan fixed in January and never revisited is a document rather than a plan.

Work with how they learn

People absorb things differently, and matching the method to the person is most of the difference between training that lands and training that is endured.

Fast growth changes the rhythm

A traditional, slower-moving organisation can run annual or twice-yearly reviews and stay roughly aligned. A fast growing one cannot, because priorities shift inside the review period. Quarterly, sometimes monthly, is closer to what the pace demands.

Goal setting has to become agile with it. Objectives evolve as the strategy evolves, which means reviewing and adjusting them as a matter of routine rather than treating a changed goal as a failure of planning.

Attracting and keeping good people matters more here too, and frequent feedback plus genuine recognition do more for that than most retention schemes. In a company scaling quickly, organisational learning is fragile: it sits in people's heads, and when they leave it goes with them.

Why the annual model is under pressure

The annual plan and annual review, with its appraisal form and self-evaluation, is an inheritance from industrial-era work. Few managers or employees enjoy it, and many of both are unclear what it is for. It consumes a great deal of time for results that are hard to measure.

Adobe dropped it in favour of regular coaching conversations after concluding the process cost an enormous amount of management time and left employees less motivated than before. Netflix stopped measuring people against annual targets on the grounds that its objectives change too fast for the cycle to track. Google built its own system rather than adopt the standard one.

The questions that stop organisations following are reasonable ones. If you cancelled the year-end review, would performance fall? How would you reward the strong and address the weak without it? The answer in each case is that the review was never doing that work well, and that what replaces it has to be continuous rather than absent.

Where this is taught

Performance and development plans are a module of the Certificate in Performance Management. See also performance management for fast-growing companies and building a performance management culture.