Publication Date

Spring 2015

Abstract

The world of performance management (PM) is undoubtedly undergoing significant reform. Deloitte’s recent survey shows that approximately 50% of organizations are unsatisfied with their PM system’s ability to drive business value, encourage development, and improve engagement and performance, while 70% are taking action to update their PM system. The annual goal setting and PM review, bell-­‐curve rating system, and rank-­‐and-­‐yank practices are simply not setting organizations up for success. Similarly, replacement planning has evolved to a comprehensive system of Succession Management, where high potential talent from all levels is identified and developed for future roles.

In addition to evolving the PM system itself, organizations have been continually assessing the optimal level of transparency. As Gen Y employees enter the workforce, there has been a call-­‐to-­‐action for employers to increase transparency in all regards. As one Harvard Business Review article detailed, “Authenticity paves the way for transparency. When employees know what it takes to perform, develop, grow, and succeed, they trust that their company is a meritocracy.” Yet, organizations may not yet be delivering on this front, with a recent Towers Watson survey revealing that 72% of organizations do not inform employees that they have been labeled as high potential and a Talent Management Network study revealing that 73% choose not to communicate advancement potential. Companies fear employee potential transparency will negatively impact engagement, motivation, and turnover. The Talent Strategy Group confronted organizations by asking, “How long do you feel it’s appropriate to lie to your employees about their future?” To encourage transparency, the organization highlighted benefits of transparency, including a culture of trust, employee ownership of their careers, and increased engagement through offering a differentiated experience for high potentials. The following case studies highlight key learnings and reasons for pursuing a transparent PM strategy.

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Suggested Citation
Kovack, K., & Kim, H. K. (2015). Along the spectrum of transparency, what is the optimal level in sharing performance management assessments with employees?Retrieved [insert date] from Cornell University, ILR School site: http://digitalcommons.ilr.cornell.edu/student/71

Required Publisher Statement
Copyright held by the authors.

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