Employee Performance Management in a Lean Agile Organization - Part 1

How do you handle employee performance management in a Lean Agile organization? How do you balance Team performance - which is values in such organization, to individual performance - which may be needed to attract the best talent to the organization? Why is SAFe non-prescriptive on these topics?

These are some of the questions I get in every Leading SAFe class I take. Sometimes, this topic is such a distraction that learners are not willing to keep it in the parking lot and insist that these be addressed upfront.

This is also a topic close to my heart and I have experimented with different models in my teams; of course within the constraints of the organization processes.

In this post, I will share my thoughts on this topic and how I address these questions in the class.

I make it a point to address these questions AFTER we have gone through module 2 - Embracing a Lean Agile Mindset.

The first question I address is why SAFe is non-prescriptive on it. I believe this is because SAFe philosophy is to tool the leaders in the Lean and Agile Values and Principles. start their journey towards a lean - agile mindset. Armed with these tools and the new perspective gained, they need to look at their context and tackle their challenges. They will be able to figure out the right direction and inspect and adapt their way to it.

However, this answer is not complete for the learners.

The deep interest in the topic is also due to the utter failure of the current ways of performance management.

Some of the problems are listed here:

  • Heavy Emphasis on Financial Rewards/Punishments
    • Internal Compete Culture
    • Impedes Collaboration
  • Growth and Improvement not incentivized
  • Retention Bias
  • Annual Feedback is Delayed Feedback

Everyone eventually is unhappy with the process and the rewards.

The current system is based on a different context.

A lot of confusion on what should be the new system is the challenge is recognizing the changing context.

With the impending shortage of talent and the increasing demand from customers, It becomes imperative that we nurture talent and incentives growth and development. Improving future performance becomes more important than rewarding for past performance.

This is how the organization context is changing

  • From Efficiency to Responsiveness
  • From Stability to Adaptability
  • From the Theory X approach to people management - where external rewards and punishment is used to make people work, to the Theory Y approach which believes that people inherently want to work and this need should be promoted and enabled
  • Most important - from Lack of trust - resulting in large hierarchies and oversight to trusting employees.

Today's challenges cannot be solved by just a few at the top - needs collective intelligence and wisdom of everyone in the ecosystem. Also, the knowledge workers were hired for their brains, not their hands and legs, we need to utilize them. We hired them, we need to trust them too.

The new system needs to promote the following.

  • Development and Learning
  • Team Work
  • Future Growth and Performance
  • Healthy Organization Culture

Lets see how these are promoted in SAFe

  • Development and Learning
    • Capacity, Time and space for it - Innovation and Planning
    • Lean Agile Leaders promoting life long learning
  • Team Work
    • People work for the train, not their individual goals.
    • Embibe Agile Principles
    • All ceremonies are a Team Sport
  • Future Growth and Performance
    • Focus on Learning
    • Focus on metrics trends, not Individual PI Performance
    • Inspect and Adapt
  • Healthy Organization Culture
    • Promote Team enablement – All ceremonies team sport
    • Teams plans and decides together

Some of the questions that come up, that I find challenging to answer are around are

  • Motivating Star Performers
  • Reward distribution within a team (Everyone does not contribute equally)
  • Avoiding Mediocrity and GroupThink in Teams

While the underlying theme for these are still sticking to the old context and mistrust of employees, I must confess, I have just hypothetical answers to them.

The next paper will talk about a possible performance model that will address most of the shortfall of the current systems and challenges of Lean-Agile Organizations.

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