The State of Performance Enablement
Using Performance Enablement to Forge a Fairer Employee Deal
T H E S T A T E O F PERFORMANCE ENABLEMENT UsingPerformanceEnablementtoForgeaFairerEmployee Deal 2023 GLOBAL HR RESEARCH REPORT
T A B L E O F C O N T E N T S 03. 05. 14. 18. Forward:ALetterfrom ExecutiveSummary Finding 1: Finding 2: theCEO &KeyThemes Employeeswhohaveconfidence Many employees see performance in their performance management reviews as biased, withdownstream review process have muchhigher efects that show up in higher levels trust in their organizations. of quiet quitting. 22. 26. 31. 36. Finding 3: Finding 4: Finding 5: Finding 6: Employeesfeel generally positive Employeesdon’t feel supported in Managers—especially newer Half of employees are not about work, ranking fairness as their careers. managers—wantandneed help getting adequate performance their top concern for a good having conversations withemployees enablement —suchas goal setting employee experience. on career, advancement,and andtracking, feedback, and professional growth. meaningful,ongoing conversations. 41. 42. Conclusion AboutthisSurvey 2023 Global HR Research Report: The State of Performance Enablement 2
F O R W A R D : A L E T T E R F R O M T H E C E O AsHRandbusiness leaders, weliveina I completely understand having taken uniquelyexciting time.Atnoother point Betterworks throughthis period as the CEO. in modernhistoryhavewedealt witha ButIwanttochallengeyoutoview allof this confluenceof forces insuch ashort period throughadiferent lens. Yes,it’s been difcult thatare fundamentally changingtheway we tosaytheleast. Butyou have theopportunity workandwhatweexpect fromit. now—andIwouldsaytheprivilege —to bebold,tolead your organization intothe Thepandemicforever altered our next frontierby helping evolve the way your perspectiveson theimportanceof work people work intoa far better state. in relation toour lives, what wevalue, and whereandhowwework.Concurrently, Oursecond annual Stateof Performance wearedealing withtheneed toup-level Enablementreport is our efort tohelp us theemployeeexperience, accelerate andyou trulyunderstand whatmattersto thedevelopmentof anew generation of theworkforce – what employees want,what managers, and provide transparency to enhances their experience of workand what The best companies don’t companyleaders around amyriad of metrics diminishesit,whythey leave, and whythey —fromworkforceproductivitytoagility. stay. Sixkey findings cameoutof our research, just focus on their customers; Businesses are copingwithhow toupskill andfrom these, wederived sixkey themes. they focus internally on their andreskill theworkforce, acceleratedigital transformation, and understand and assimilate Above all, wesee that theemployee deal — employees as well. Happy, ayounger generation of workers witha essentially, theemployee value proposition — engaged,andempowered diferent set of values. They mustretain and mustbere-engineered. Employeesfeel they attract talent in a competitivemarketplace and havegiven their all, especially since 2020, employees arewhatmakean acontinually evolving business environment andthey expect morefrom their employers wheresuccess requires agility. in return. Theemployee deal comprises the organization go beyond explicit and implicit promises to employees, being successful to being I know someof you maybe thinking,“What? encompassing everything from total rewards to Addressingthechallenges of theworkforce broader concepts suchas fairness, inclusion, truly transformational. andimprovingtheemployeeexperience has career care, purpose, and well-being. never been morecomplex, and I’mexhausted, not excited!” 2023 Global HR Research Report: The State of Performance Enablement 3
F O R W A R D : A L E T T E R F R O M T H E C E O Thesupportingthemesfall under this of productivity,confidence, engagement, overarching themeof delivering a better optimism,focus,and relevance are higher employee deal. Employers mustrespond across the board for employees whohave to the desire for career growth and tools that enable great performance. development if they wish to avoid the retention clif —our second theme.Third, It’sclear from our research and from third- fairness mattersgreatly toemployees and partystudiesthattheshift from traditional colors their entire experience. Feelings performancemanagement toacontemporary of bias in systems like performance solution —whatwecallperformance managementcanundermineamultitudeof enablement—is underway. other workforce sentiments,and fairness is sorely absent in performance reviews Nowisthetimetoadapt, change, andgrowto according toa majorityof employees. Bias evolve and elevatetheemployee experience. leads tomistrust, and as weexplain in our Thebest companies don’t just focuson their fourth theme,trustin HR is at a low point. customers; they focusinternallyon their Organizationsmustbe mindfulof this gap. employeesas well.Happy, engaged,and Withtherecent conversationsabout burnout, empowered employeesarewhatmakean whichputeveryone at all levels at risk, organization go beyond being successful to businesses mustdouble down on their eforts being trulytransformational. torelieve this pressure point. Nowhere is this moretruethan for managers. Ourfifth AtBetterworks, we’ve been on amission themeisabout better supporting managers toenable great performanceandimprove byup-leveling performance and, especially, theemployee experience withbest-in-class, development coaching. Empoweringyour consumer-grade technology that helps managerstocoachwillhavean outsized companies align, motivate, develop, and impacton your organization. Lastly, wesee retaintheir people. Ihope thatthis research that good performance enablement —which provides you withtheinsights anddatayou allows employees tocreate meaningful need tomovetowardahuman-centric wayof developmental and performance goals that operating.AndIlook forward toengaging ina align with their company’sstrategic goals richconversation about how wecanallmake and equips managerstofrequently coach workbetter. andenable employees —hasamultiplier efect on the organization. Employeefeelings Doug Dennerline |CEO, Betterworks 2023 Global HR Research Report: The State of Performance Enablement 4
E X E C U T I V E S U M M A R Y & K E Y T H E M E S Growth, Enablement, anda FairerEmployeeDeal Tomeetthefutureof work, is still underway —powered not only by pathing for tomorrow.Ourdata shows that companiesmusthelpemployees employee resignations but also by layofs due to cultivating a good employee experience must to see a clear and fairpath for technologyshifts, inflationworries, and a threat be laser-focused on fairness and belonging for of recession. Aswesurveyed employees for this companiestosucceed. growth. This means reforgingthe second annual performanceenablementsurvey, employeedeal and proactively manydidsaytheyarestilllooking for new jobs enablingemployeestodevelop —butamajority saidtheywouldactually much Thediferenceayearmakes their careers in place, ensuring prefer todevelop and grow where they are. Webeganthisyear’s survey by looking tosee that developmentisunbiased and Moreover, employeesare stepping uptheir whathadchanged comparedtoour2022data. elevatingperceptions of inclusion. game.They arefeeling positiveabout work and Althoughsomecontinuityintheresults remained, are moreengaged andcontributingat higher there werealsonotable changes. Employee levels than last year. They are doing their part intenttoleave isroughlythesameas itwas last Companies mustfocuson providing employees tohelp their teams succeed, but manyare year: 14% of employees saythey are actively andmanagers withtheskills andtechnologyto concerned about fairness inthesystem. seeking new work versus 13% in2022. Still, talk not only about performance—but alsotheir overall, the momentum of the revolving door careers andlong-termskilldevelopment.They Toretain these employees and help them is slowing.Passivejob searching has dropped mustalsotrytoeradicatetheperceptionsof bias deliver on their potential, companies must significantly —to9%versus 22%last year. There andstagnancy thatmakeemployeesfeel less focus on a new and broader definition of is an uptickin people whoare waitingout the valuedanddrivethemtowardquitting—either the“employee deal.” That means crafting economy(6%)before theygo,butthereare quietlyor loudly. an employee value proposition (EVP)that morepeople whoplantostay intheircurrent includes not only traditional total rewards, but job (40%),andmorepeople whoare looking Disruption has becomethenewnormal inthe amodernperformance managementapproach for advancement intheircurrentcompany (17% workplace (andall our lives), and 2023 isshaping that reflects the needs of today’s workforce versus 13% last year.) up to be no diferent. The Great Reshufe and embracesskills development and career
E X E C U T I V E S U M M A R Y & KEY THEMES Whatdoes allthis mean? The good news Employees are less vulnerable to poaching in 2023 is your employees don’t wanttoleave you. Amajority of people like working for their Yes,I’m open torecruitment by a new company: companies. Thebadnewsistheymightgo Thegood anyway if you cannotgivethemthetools and 22% 2022 opportunitiesthey need togrow in place. news is, your Lastyear, wewere stillseeing a‘pandemic 9% 2023 employees efect’ in the reasons people stayed and went. Afterpay/benefits(43%),themost influential don’t want factors in changingjobs were stress/well- being (30%)andflexible work options (22%). Career growth is rising in importance in 2023 to leave you. Career advancement opportunitiestrailed in fourth place(20%). Thebadnews Thisyear, the focuson pay has increased is, they might even morethanusual (51%)as thetopreason for leaving a job. This is not surprising, given go anyway if theconcernsof apossiblerecession. Ourquestions were slightly diferent thisyear, youcannot butwecan still see howpeople havealso give them shifted to alonger-term view.Flexibility,while still in the mix, has dropped to fifth place. the tools and Development concerns have ascended and are top-of-mind. Career advancement isthe No. opportunities 2reason people arethinking of leaving in 2023 (35%), followed by professional growth (34%) they need to andwantingabettercompany culture(30%). growinplace. 2023 Global HR Research Report: The State of Performance Enablement 6
E X E C U T I V E S U M M A R Y & KEY THEMES OVERALL, WE SAW SIX MEANINGFUL THEMES EMERGE F ROM THIS YEAR’S DATA. Thecurrentemployee deal needs to HRmustmindthetrustgap bereimagined Avoidingtheretention clif requires Accelerating manager efectiveness focusing on career development through coaching and resourcesis vital Fairness matters – it colorsthe Goodperformance enablementhasa employee experience multiplier efect
E X E C U T I V E S U M M A R Y & KEY THEMES Thecurrentemployeedealneedstobereimagined Theemployeedeal isabout morethanpay employeeshaveseen significant changes to andrewards. It includesskills development, their performancemanagement processes purpose, fairness, inclusion, culture, and more. andtools inthepast twoyears. Anecdotally, It comprises thetotalityof theemployee wealsohaveseen employersmakingreal experience, includinghealthandfinancial eforts with well-being programs, customized well-beingandlong-termcareer aspirations. Theemployee deal isabout Theemployeedeal hastwosidestoit,and more than pay and rewards. employeesfeel they are workinghardat It includes skills development, delivering on theirs—givingtheir all and fulfillingtheir part of the “contract.” Employees’ purpose, fairness, inclusion, assessment of their own productivityand culture, and more. engagementhassignificantly outpaced what wesawin2022.Employees’ senseof their benefits, flexible work, and more. Employees ownproductivityhasrisen eight pointsto67% generally really like working for their whiletheir view of their discretionary efort has companies, andwanttostay. jumped19pointsto60%. Yet, workers are also showing frustration They’ve dealt with layofs and re-assignments, withthe lack of options open to them.They Employees who answered that they readjustedtonew waysof working,andborne believe their organizations are not providing AlwaysGoAboveandBeyond stress and burnout,not just from work but from adequate opportunities for growth and everythingthathashappened intheworld in career advancement,and sometimestheir thepast few years. They’ve persevered. managers—especially newer managers— are ill-equipped to help them. Butas resilient andproductive as theyhave 41% 60% been, theyare not always seeing areturnon To keep them,employersmustexpand their whatthey’veputintothesystem. vision for theemployee deal. Thisincludes showingworkersapathfor advancement and Employershaveabsolutelybeen working providing themwiththetools andguidanceto 2022 2023 on tryingtoimprovethesystem,too. Many moveinternally. 2023 Global HR Research Report: The State of Performance Enablement 8
E X E C U T I V E S U M M A R Y & KEY THEMES Avoiding the retentionclif requires focusing on career development It’sworthnotingthatthisistrueat all ages — for Gen Z andMillennials as for older workers. Inboth of those cohorts, 72%saidthey would 3 out of 4 employeeswould prefer prefer toadvance intheircurrentcompanies, to advance at their current company versus 77% of those 45-60 and 78% of those over 60. Now,thetougher news.Eventhough most employees want tostay,iftheorganization failsto live up totheemployee deal, those employees will leave anyway. More than half of employees don’tsee apathfor advancement in their current First, the good news. Thepreference for company—and career advancement and employees seemstobegrowing where they professional growth are theNo.2 and No.3 Total rewards are top of mind, are planted, over job-hopping. A majority(75%) reasons for employees tobe lookingfor work. but people will stay for development of people said they would rather staywith their and career growth company toadvance in their careers. Whenweaskedemployees whomayleave whatwould helpthemdecidetostaywiththeir company,payand benefits predictably topped More than half of employees thelist. And, here again, career took theNo.2 don’t seea path for spot. Thisyear’s respondents citedinternal career opportunities (41%)and better skills development advancement in their current (36%)as their other top reasons for staying. company —alackofcareer Ongoingcompetitionfor thebest talentcoupled 61% 41% advancement andprofessional withan uncertain economymeanscompanies growth are the No.2 and are in danger of losing talented employees if they can’tdeliver on thepromiseof career No.3reasonsforemployees growthandadvancement. Pay&Benefits Career Growth to be looking for work. 2023 Global HR Research Report: The State of Performance Enablement 9
E X E C U T I V E S U M M A R Y & KEY THEMES Fairness matters– it colorsthe employee experience Thisyear’s dataalso showcases thegrowing matrixed organizations. A manager isbest served importanceof therelational andsocial factors byhavingacompletepictureof an employee of work.Peoplewanttofeel they are partof andtheir performancethroughthefeedback of somethingbigger than themselves —valued, team membersandother colleagues. recognized,andtreated fairly —as well as on the road toa brighter future. Fairness, good culture, Whenemployeesfeel theyarenotbeingtreated andteam supportwereallthemes thatbubbled fairly, there isa knock-on efect on productivity upinthisyear’s data. andengagement—resultinginthelong-standing phenomenonthathasrecentlybeen coined Fairness was one themethatstood out.This as “quiet quitting.” In many ways,this is a self- year’s datashows thatmanyemployeesfeel inflicted wound, albeit often unintentional, for performancereviewsarenot entirelyfair, mainly companies. Butit’s fixable, and organizations duetoinadequatefeedback frompeople the that address feelings of fairness will have more employeeworkswithdayinanddayout.Most success inretainingtalent andensuring their people work inteams or incross-functional, people stay engaged, happy, andproductive. Whenemployees feel they are not being treated fairly, thereisaknock-onefectonproductivityandengagement —resulting inthelong-standingphenomenonthathas recentlybeen coinedas“quiet quitting.” 2023 Global HR Research Report: The State of Performance Enablement 10
E X E C U T I V E S U M M A R Y & KEY THEMES HRmustmindthetrustgap Concerns about fairness have a working toelevate theemployee reciprocal relationship with trust —as experience andshiftingtheir values bias in the system can afect trust towardstakeholder —ratherthan in leaders and vice versa. Trust has shareholder—value. stagnated —andonceeroded, itcanbe difcult to rebuild. In 2023, employee Thisis asnapshotintime.Distrust levels of trust are at a dangerously low maystill be high due to economic ebb. Theupsideisthatmanyemployees uncertainty, or it may simplybe that report high trust in their managers. Still, stakeholder-focused initiatives, such three in ten don’t trust team members as those around employee well-being, Withcontinuedgood-faithefortstosupportemployees and managersandtomakeperformance management systemsfairer, HRandcompany leaderscan forge higher employee trust. or managers, andabout seven inten have yet to be fully realized. With don’t trust leaders or HR. Tenpercent of continued good-faith eforts to support employeesdon’t trust anyone at all. employees andmanagersandtomake performance managementsystems Lowtrust isnot abigsurprise. fairer, HR and company leaders can Accordingtomultipleother studies, forge higher employee trust.This trust in HR and leadership were low canassureemployees thatleaders prior to the pandemic. But they may and HR —often the custodiansof the bedisappointingtoread, nonetheless, performance process —are working in given how organizations have been their best interests. 2023 Global HR Research Report: The State of Performance Enablement 11
E X E C U T I V E S U M M A R Y & KEY THEMES Accelerating manager efectivenessthrough coaching andresources is vital Managers are thelinchpinthatholdsyour ‘always.’ A strongpluralitybelieves managers organization together. This year’s analysis reveals careabout their progressand are tryingtobea Yourcoaches thatemployeestrust their managers as muchas help totheir careers. Butmanagers —especially their teammates. Nineout of ten people saidthey inexperienced ones —are ill-equipped when needcoaching. always or sometimes like working it comes tocoachingfor growthandcareer for their manager —with development.Andemployeeswillleaveifthey Regularandefective 48%saying see nopathfor career advancement. Thebottom line: your coaches need coaching. manager-employee Regular and efective manager-employee conversationsabout conversations about both performanceand developmentare tremendouslyimportant to bothperformance theemployee experiencewhenitcomesto engagement,inclusiveness, belonging, value, anddevelopmentare andsatisfaction. This is significant because half of employees (49%)also told us they’ve tremendouslyimportant consideredleaving a job becausetheir manager wasbadatgivingfeedback or reviews. There to the employee isalso enormous potential for organizations tousemanagers topromotecareerandskills experiencewhenit development,butmost companies do not appear comestoengagement, tobeleveraging themtocapacity. To efectively take advantage of the relationships inclusiveness, managers havebuiltwithemployees—andto belonging,value, better supportthoserelationships over thelong term—HRmustprovidemanagers withmore andsatisfaction. trainingandtools tocoachfor skills andcareer development,not just performance. 2023 Global HR Research Report: The State of Performance Enablement 12
E X E C U T I V E S U M M A R Y & KEY THEMES Goodperformanceenablement hasamultiplier efect Rethinking your performancemanagement Someofthiscomes downtothetools today will have a multiplierefect, yielding far companies use. Those tools mustbe better sentiments and outcomesacross lightweight,dedicated, and easy touse your organization. in the flow of work to be useful for both performanceanddevelopment.Otherwise, employeesusethemonlyonceor twicea Thehalf ofworkers year for performancereviews, rendering these whogetmeaningful tools largely inefective when it comes to continuousperformanceimprovement. performance Thedatainthisreport makesclear how enablement — acutely performance enablement afects sentiment,well-being, and feelings of mastery havefar higher andautonomy.Good enablement isa transformational approach that changes the levels of optimism, wayemployees feel about their work, purpose, eforts, interests, and feelings of belonging. confidence, Employeeswantperformanceenablement to Theefects are synergistic.A performance help them increase their efectiveness and enablement mindsethas theability tochange engagement, and grow their careers. Thehalf of workers who hearts and minds,as well as bottom lines.It’s get meaningfulperformance enablement — anewwayof thinking about how weview our productivitythanthe including goal-setting and tracking, feedback, people —one that connects people, promotes half of employees and purposeful and ongoing conversations collaboration, values employees, and elevates —havefarhigher levels of optimism, theemployee experience. whodon’t. confidence, engagement, and productivity than thehalf of employees whodon’t. Among thelatter group, two-thirds want adequate Let’s dig into the findings. performance enablement. 2023 Global HR Research Report: The State of Performance Enablement 13
Employees who have confidence in their F performancemanagement I review process have N muchhigher trust in D their organizations. IN Performancereviewprocesseshave undergonesignificantchangessincethe pandemic,butit’sclearthat thechanges G eitherhavenotgonefarenoughto substantiallyimprove employee experience orhavenotyetbeenfullyrealized. 1 Employeeshavemixedperceptions ofhow performance reviews areworking, with many citingthemas awasteoftheirtime and 1in 3callingthemanoutrightfailure.Whileteam Only 1in3 employees say the trust is largely unafected by performance reviews,faith inthe success or failureof performance management review these processesgoeshandinhandwithtrust processhelpsthem performbetter. in managers, leaders,and HR.
Hastheperformance review process in your 37%ofworkerswithanopinionsaidthat F companyundergone afundamental shift since2020? performancemanagementis an outright I N failure in their company.That’san “F” grade D I whenitcomestotheirperformance,alignment, N G andcareergrowth. 1 Performance reviews are changing. Since Despitethesetrends, only 1in3 (32%)of all 2020,46%of our survey respondents toldus employeestodaysaidtheircurrentperformance their companies haveadded new performance management system helpsthemperform better. management technology(17%),new processes (18%),or both (11%). Thismayaccountforwhysofew employees believe the performancereview processwas This likely reflects eforts on the part of leaders agooduseof theirtime:19% said the to streamline performancedevelopment and process was never a waste of createmoreequitable review anddevelopment timeandefort,and 64% seeitas processes in response tomajor changes in how always or sometimes a waste. weworkandtheongoing talentcrunch. Someof theseeforts are paying of. For Similarly, only 46% of employees said they believe example, employeeswhosecompanies performance managementisasuccess.But implementednew technologyand/or 27%of respondentssaid they didn’t know, and processes were morelikelytosee their another 27%of workers said that performance performancereviewsas fair and unbiased, say managementisafailure in their company. they felt recognized, view performance management as relevant totheir dailywork, If weremovethosewhodonotknow and andweretwiceas likelytofeel theperformance recalculate, that’s 37% of those withan opinion management processwasuseful totheir on their performancemanagement saying it is performance(61%versus 28%). an outrightfailure. That’s an “F” grade when it comes totheir performance, alignment, and H career growth. O M E 2023 Global HR Research Report: The State of Performance Enablement 15
Only 32%ofpeopletrust their leaders, and only 26%saidthey trust HR. Thisgap may beunderminingoverall faithin thesystem.
Onereason somanyworkerslackconfidence theperformancereview process. Conversely, RECOMMENDATION in their performancemanagement and weseemoretrustinmanagers whenpeople F assessments maybealackof organizational believe performancemanagement isa I trust. success —rising to79%from abaseline of N 63%.Thisisnearly double thelevel of trust in D While68%of respondentstold us they trust managers comparedwithemployeeswhosee Traditional performancemanagement I their teams and 63% trust managers, only performancemanagement as afailure. has 100-year-old roots. While it has N 32%ofpeople trust their leaders, and only changed over time,the approach G 26%saidtheytrustHR —whoareoften the Wesawsimilarly dramatic shifts in the levels is not well-suited to employee custodians of the performanceappraisal of trust people have in organizational leaders expectations, the realities of modern 1 process. This gap maybe underminingoverall andhumanresources —wheretrustinboth work, and the speed of change. It faith in the system. organizational leaders and HR leaders is breaksrather than builds trust. morethan 4xhigherwhenemployeesview It’sworth noting that trust in managers drops performancemanagement as successful. Organizations and employees 23%whenpeople havelost confidencein increasingly realize and expect that performancemanagement Thesuccess of performance managementcorrelates withlevels of trust across the organization mustcontinuously drive employee engagement to improve Trust: When performance organizational performance.With managementisseenasasuccess agile and matrixed working models Baseline feelingsof trust on the rise, enabling discussions of Trust: When performance progress against targets needs to managementisseenasafailure be more frequent to help employees stay aligned with their organization’s strategic goals. Employers alsohave the opportunity to increase trust. First, they can show they care about career development through meaningful training and growth opportunities and more thoughtful conversations between managers and their employees. Second, they canactively remove H Trustin HR Trust in organization Trustin direct Trustin team Trustin noone O leaders manager members bias from performanceprocesses. M E 2023 Global HR Research Report: The State of Performance Enablement 17
Many employees see F performance reviews IN as biased, with downstream effects that D show up in higher levels IN of quiet quitting. Amajorityof employeessayperformancereviews G arebiased, whichexplainswhy manysee themas somewhat or completelyinefective.This negative sentimentshows inimportantoutcomessuchas 2 productivityand discretionaryefort —resulting in the kind of quiet quitting discussed on social media. Ourdatashowsthatwhenemployeesgetfeedback fromteammembersaswellasmanagers—and 1in3 employees see thefeedbackisused inreviews—itcorrelateswith employees’feelingthat reviewsare fairer. performance reviewsas entirely unbiased.
In addition to lacklusterfeelings of confidence Fewerthan1in 3employeessee Feelings of overall equity and fairness in the in performancemanagement systems,25% performancereviewsasvery employee experiencealsotakeahit.When F of employees toldus they see their current fair and equitable people feel there isbias in the system,their IN performancereview systemsas either biased feelings of belonging and value at workdrop or very biased. 42to60percentagepointsfromahighof D 70%(whentheyfeel reviewsareveryfair IN Another37%saidtheyseethesystemas only 25% andequitable). somewhat fair, and only 30% of employees G saidthey believe their review processis 37% completelyfair and equitable. 2 8% Feelings of belonging Thosewhoseethe areupto60 reviewprocessasvery 30% percentage points biasedaremorethan higher among They are somewhat fair andequitable employees who twice as likely to say They arevery fair andequitable seetheir reviews Theyarebiased as very fair theyarelookingfor Don’tknow and equitable. work elsewhere. This directlycorrelates to some of Productivity is up employees’ mostimportant metricsaround to 23 points higher Onewaytoaddress thefairness gap inreviews performanceandengagement.Whenthey (83%vs.60%)and maybetolook morecloselyat thepeople seeperformancemanagement as biased, engagement isup involved in the process. Input from a broader they often also exhibit signs of quiet quitting. array of stakeholders correlates with increased Productivity and engagementlevels drop to 14 points higher confidencein fairness: 84% of this survey’s measurably for people whobelieve reviews (71%vs. 57%) among respondentsworkinteamsat least someof the are somewhat or very biased. time,but only 29%saidfeedback fromteam employees who see membersispartof howtheir performanceis Similarly,thosewhosee thereview process their reviews as very measured. Nearly 4in5 employeessaid that as verybiased are morethan twiceas likely fair and equitable. they thinkincorporatingfeedback from twoor tosaytheyare looking for work elsewhere — morecolleagueswouldmaketheperformance HO whetheractivelyor passively. reviewsfeel unbiased. M E 2023 Global HR Research Report: The State of Performance Enablement 19
Nearly4 in 5 employees said that they think incorporating feedbackfromtwo or more colleagues would makethe performance reviews feel unbiased.
Forreviewstofeel unbiased, Employees whogetfeedbackfromtheirteam RECOMMENDATION 78%ofemployeeswant morethanone in reviews are 2-4.5x more likely to feel F source of feedback on their work reviewsareunbiased IN D 9% Employees whosee reviews as very fair Implementananytime feedback I 12% and equitable modelsothat employeesand N 10% managers canfreely request and G 50% Whenteam feedback is received and used in reviews provide written feedback, and use 2 Whenteamfeedback peer feedback in the performance 19% is received but not review process. Additionally, review used in reviews your performancemanagement processfor biases, such as recency, 11% Whennoteam confirmation, and negativity bias. 69% feedback is received To truly root out bias, HR should 1person 10% 20% 30% 40% 50% go one step further. Leverage 2-5people Notshown: “I don’t know.” AI, data, analytics, and reports 6-10+people to determine whether there are Noamount of peoplewill makeme Workerswhohadfeedback fromteam leaders systemic biases. Audit your workforce feel feedback is fair andunbiased andmembersincludedinreviewswere2.5x practices, including performance less likely toreport bias. Those who had no ratings, calibration, promotions, Thesweet spot here seems tobebetween ability for teams togive themperformance and compensationdecisions. twotofive people —but just havingmorethan feedback were 4.5x morelikelytosay they Investigate “leading indicators” of amanager involved ingivingfeedback islikely sawbiasinthesystem. bias. These could include whether tohelp. underrepresented employees receive Whenweaskedemployeesiftheyhad coaching conversations with the theabilitytoget feedback from team leaders samefrequency asother employees or members, 70% said‘yes’ and 46% said and whether the language used in that managers used feedback in feedbackquestions and responses performanceconversations. varies across underrepresented HO employee groups. M E 2023 Global HR Research Report: The State of Performance Enablement 21
F Employees feel generally IN positive about work, ranking fairness as their D top concern for a good IN employee experience. Relational and socialaspectsof work, such as G fairness, belonging, and trust,are becomingmore importantas organizationstune into the employee experience.Wefoundthatemployeesaregenerally 3 positiveand feel good about the contributions they aremaking. However, theysurfacedfairness as an importantvalue—whichshouldbeinstructiveas employersexaminetheirperformancemanagement processesforequityand bias. 55%ofemployeesrank fairness as the most important aspect of the employeeexperience.
The“softer” aspects of workhave become F dramaticallymore I important in recent years N as companies reorient D around employee I well-being and inclusion, N andas purpose and corporate G responsibility become essential parts of theemployee value proposition. Thetransition 3 tohybrid and remote workand theimpactof Gen Z workers are likely also factors in these shifts. Sincethepandemic, companies have focused on areas like employeeexperience, DEI,andtrust.Whilenew economic forces havetempered somecompanies’ reactions toThe Great Reshufe, Employees arefeeling positive overall thelabor market isstilltight in most industries, and the competition for talent will likely continueas population trendsassert themselves. 56% Productive 42% Confident 38% Engaged 38% Optimistic 36% Stressed Wehaveseen agrowingemphasis fromcompanies on ofering a better employee deal —whichincorporatesnot only total rewards 35% Focused but skills development, purpose, culture, financial well-being,health andwellness, andmore. 21%–29% Overwhelmed, Burned out, Resilient Weaskedemployeeshowtheyfeltaboutwork,andtherewas muchgoodnews.Apluralitysaidtheyfelt productive,confident, 12%–14% Detached, Distracted, Pessimistic H engaged,andeven optimistic. O M E 2023 Global HR Research Report: The State of Performance Enablement 23
Thispositivityfromemployees may Wedidnotaskemployeestodefine Fairness is the most important factor comeasasurprise tothosewhoare fairness in this report, but given F only tuned intocalls for improvement. thefindingsacross therestof this in the employee experience IN Organizations should takethis as a data, wecanreasonably surmise 55% good sign overall. that perceptions of fairness include 53% D elementsof equity (inboth access 50% IN Employees stillsee room for and pay), trust, inclusion, elimination of improvementnonetheless: only 37% bias, the inclusionof more voices, and G saidthey always feel they belong and delivery of thepromises made by the 44% 42% are valuedat work. evolving employee deal. 3 Whenweaskedemployeeswhatwas Additionally,a good work culture, 38%37% mostimportant totheir experience, flexibility, growth, and having a fairness topped the list, followed, supportive team rounded out the top 31% unsurprisingly, by culture. five contributors to the employee experience —underscoring the 26%25% Given our observations inFindings points we’ve made here about the 1and2—withregard toalackof importanceof building a culture that confidenceinperformancereviews supports career growth and pathing. 18% andperceptionsof biasinperformance Each of these elements works management — it’seasy tosee how together to create an environment fairness has bubbled to the top of that values career development as employees’concernsin2023. muchasperformance. 14% 2% Only 37% of employees always feel they belong Fa oG elF rG uS eB tS uP arT mE uA tO inr do ix wo pp ol nor pr sn p ot eh and arevalued atwork sse w lib ht o gn g seo ap hta on r 49% o yit vitr gni el er y m rk e da tn y Sometimes 37% cu aet shre co Always lut m pi mm re u Rarely/Never cain toi n HO M E 2023 Global HR Research Report: The State of Performance Enablement 24
RECOMMENDATION F I N D Withfairness, inclusion, belonging, I and trust so intertwined —and N elemental —to the employee G experience, it behooves HR leaders to examine the processes and 3 behaviors that undermine these in an organization. This includes reviewing your performance management approach with your workforce to determine if and how it is viewed asunfair and biased, especially when it comes to how you enable career growth. If you don’t already have one, institute a calibration process that’s fair and rates everybody Wecanreasonablysurmise that the same way for similar types of achievements and behaviors. The perceptions of fairness include elements right technology will allow you to easily peer into your data to uncover of equity (in both access and pay), trust, sources of hidden bias. The results may require making inclusion, elimination of bias, the inclusion adjustments to your performance management processes or they may of more voices, and delivery of the lead you to consider overhauling them all together. The time to act is now, while employees are generally H promises of the employee deal. O feeling positive. M E 2023 Global HR Research Report: The State of Performance Enablement 25
F IN Employees don’t feel D supported in their careers. IN While75% of employeeswould prefertostay and growwiththeirorganizations,less thanhalfsee a clear path for advancementintheir current company. G Only46%report feelingsupported intheir career aspirations. But manager-employeecareer check- ins help employees feelmuchbetter supported. And 4 there’salso a clear tie to importantoutcomeslike productivityand engagement. Only48%seeapath for advancement in their current company.
Employees are thinkingmoredeeply than Thenewsisworsefor front-line employees. Employees are most likely ever about their career development—and Only40%of individualcontributorssaw a way to think their manager cares F specificallyhow todevelop skills, grow, and forward. This is skewed abit.Many employees about their career growth — IN advance intheircurrentcompany. at the higherlevels were also older workers but 1 in 3 don’t think anyone cares. whoindicated theydidn’t need or wantcareer D To stay andthrive, employees wantmoreand developmentor advancement because they 56% Mymanager IN better conversations about growth and tofeel werealready at thetopof their careers or 30% Noone thatsomeonecares about theirdevelopment. closetoretirement. G Thisispartof theemployee deal: Employees 13% HR wanttofeel thatinexchange for theireforts, This begs thequestion, “Are employees 4 their employersare committedtoinvestingin getting adequate conversations around career 18% Someone else their growthandadvancement. development?”Theanswer isno. While38%toldustheyfelt supported in both Abouthalf of employees are getting check-ins Checkallthatapply their career aspirations and performance, 28% on career, advancement, and growthmore saidtheyfelt supported inperformancegoals than once a year. A quarter of employees InFinding1, wesaw thattrust inmanagers only. More than a quarter(26%)saidthey did havecheck-ins moreoften, butanother isas high as it is in teammates. Employees not feel their organization supported themin quarterreceive nocheck-ins about their echoed thatsame senseof confidencein either their performanceor career aspirations. careersat all. their managers whenweaskedwhoat their Thedisconnectistroubling:Aswesaw Amongemployees whohave check-ins, only company supportsthem.More than half of mentioned earlier, 75% of employees 31%said they are always satisfied with those respondentssaidthepersonwhomostcared prefer togrow andadvance at their current conversations. Wesee the fallout from this about their advancement at workwas organization but less than half (48%)see a in the way employees feel supported by their manager. pathway for advancement. their managers. Still,that number(56%)leaves alot of room for improvement, and30% of people said thatno onecares about theircareer growth. Only 38% of It is worth noting that —as withtrust — 38% employees feel employeesdonot thinkmanyinHRhavetheir both their backwhenitcomestocareerdevelopment. performance and career aspirations Fewer than 1 in 2 employees see Whilethismayfeel disheartening,given the are fully supported by a clear path for advancement in their organizations their current company. outpouring of efort by HR to protect employees and enhancetheirwell-being, it simplyindicates HO thatthere ismoretobeaccomplished. M E 2023 Global HR Research Report: The State of Performance Enablement 27
Employees who are satisfied with career and development check-ins are up to 750% more likely to see a path for advancement.
Thereisan opportunityfor HR tocontinue pathing. Employeeswhoare alwayssatisfied making ameaningful impactbyhelping with theconversations they have withtheir F employeesdevelop andadvance their managerabout their career,advancement, I careers and bydemonstrating thatHR is and professional growth were 65 percentage N advocatingfor their success. points morelikely tofeel there wasapath for D advancement for them in their current company I Check-insmakeatangible diference in versusthose whowerenever satisfied. N feelings of support and perceptions of career G That means employees who are always satisfied with career 4 and development check-ins are up to 7.5x more likely to see a path for advancement See a clear pathway for advancement Always 75% Sometimes 48% Rarely 25% Never 10% H Employee satisfactionwithcareerdevelopmentconversations O M E 2023 Global HR Research Report: The State of Performance Enablement 29
Employees who are satisfied with career and development check-ins RECOMMENDATION are also more likely to say they are always engaged and productive. F IN D Engaged Productive Career pathing works. If you IN 82% “Never/not at all”
Managers —especially newer managers —want and need help having F conversations with IN employees on career, D advancement, and professional growth. IN Managers are the linchpin for organizations G in delivering important conversations around performanceand career development.So, how equipped are these people leaders when it comes 5 to having critical check-ins?Managers expressed confidence in their ability to have efective conversations around performance but said they need more tools and support —particularly from HR—tocoachforcareergrowth and advancement. This data revealsa need to support newer 46%ofmanagers don’t feel confident managers,in particular,because they are not coachingforcareerdevelopment. providing the same experience to employees as their more tenured colleagues.
Good performance conversations with managers have a multiplier effect on outcomes across the board F IN 80% 81% D Always engaged I Very productive N 73% Always feel valued G 68% Always like working 66% for thecompany 5 60% 62% Themanager isone of the 55% 54% 55% mostcritical levers of employee experience, and overall, this research 47% 48% shows employee confidencein their managers. Whereonly39% of people 40% saidtheyalways likeworking for their company,48%saidtheyalways like workingfor their direct manager — andonly11%saidtheyrarely or never like working for their boss. 30% Let’s begin withconversations 26% around performance. Whenpeople 20% are satisfied withtheconversations theyhavewithmanagers about their performanceandworkgoals, thereis 12% amultiplierefect on outcomesacross 10% 11% theboard.Well-coachedemployees 9% aremorelikelytosaytheyarealways engaged,veryproductive,always feel they belong andare valued, and like Always Sometimes Rarely Never workingat theircompany. HO Satisfaction withmanager conversations M E 2023 Global HR Research Report: The State of Performance Enablement 32
Whereonly39%ofpeoplesaidthey alwayslikeworkingfortheircompany, 48%saidtheyalways like working for their direct manager.
In Finding4, wesaw how important career Managers wantmoresupport in... conversations are tomaking employees feel Only 24% of managers F supported andable tosee acritical pathway say they always get IN for internal advancement. the support they need 41% from HR 40% D Alargegroupof employeesremains IN unsatisfied withthesupporttheir managers Managerswantbettersupport from their Coaching Reviews, assessments, are giving themfor careerand development. organizations. Their top priorities are more G This shouldbeared flagfor managers. Only guidance in coaching performance (41%);help performance andratings half (51%)said their manager is a help to them with reviews, assessments, and ratings (40%); 5 in their professional growth.Another33%said and assistancein helping employees develop their manager is neither a help nor a hindrance, skills and path careers (38%). 38% 34% and 16%considered them an outright barrier to their careers. Managers are highlyreceptive toreceiving This maybe inpart becausemanagers are help and feedback.Infact, they were 15 Helpingemployeesdevelop Settingand percentagepointsmorelikelythan individual skills andpathcareers trackinggoals simplynot confident inhavingconversations contributorstosay they wantmorefeedback about careers withtheir directreports.Many on their work. supervisors —especially new managers —said they feel ill-equipped for conversations about Supportingmanagers isparticularly important 34% 32% career andadvancement. in thecurrentclimatebecausetheywere Thecoaches wantcoaching. While 71% of significantly more likely than individual Giving Providingsupportand respondentssaidtheywereabletodeliver contributorstosay they were looking for or feedback empathy toemployees high-quality performancefeedback, only 54% open tochangingjobs inthenextyear (47% felt confident ofering career development and versus 34%of individualcontributors). coaching. Oneinten didn’tfeel confident in Likeindividual contributors, managersalso Tenureisan important part of thisstory. Employee either one. have low trust in their organization’s leaders satisfaction withmanager conversations on (31%)and HR (24%)—somethingthat should performanceandcareergrowthcorrelates withthe Only 54% beconcerning for their business partners in tenureof one’s manager. of managers those areas. feel confident Whilenew managers haveroughlythesame delivering career Only24%of managers felt they always get frequencyof check-ins withtheir reportson thesupporttheyneed frompartnersinhuman performanceandcareer, wesaw thatexperience development resources, while nearly a third (32%)said they level significantly impactedemployees’ satisfaction HO and coaching rarely or never do. withtheseconversations. M E 2023 Global HR Research Report: The State of Performance Enablement 34
Employees withmoretenuredmanagers All of this should set of alarm bells for leaders RECOMMENDATION werefar morelikelytosay they liked working whowanttoensureaconsistent employee F for their manager: 56%saidthey always like experience across all managers in the I workingfor managers with10+years of tenure organization. It is clear that employersneed N versus 40% for new managers withless than todoabetterjobof trainingand supporting D twoyears of experience. Similarly,employees managers earlier in their tenure. Being anefective managerrequires I are morelikelytofeel their manager cares relational and coaching skills that may N about their career developmentwhenthat not comenaturally. HRshould support G manager has 10+years of tenure(63%)versus managers with the resources and 43%for newmanagers. training they need to communicate 5 and connect employees’ work to the organization’s purpose as well as to Satisfaction with manager conversations is linked to manager tenure coachandenable their teamsand direct reports. 31% Onperformance Strengthening your managers will Lessthan andwork goals 2years 23% Oncareer, have an outsized impact on the advancement and business. Ask them what resources professional growth and tools they require, and develop 32% a menu of support options that 2-5 years address significant needs. To 28% makeyour efort cost-efective and scalable, leverage a technology solution that allows you to embed 38% these capabilities in the flow of work 6-10years and with just-in-time, context-aware 32% nudges, recommendations, and best practices that empower managers to be their best. Morethan 45% Seekto continuously improve and 10 years 38% fine-tune your plan with managers to ensure you meettheir evolving needs. H O M E 2023 Global HR Research Report: The State of Performance Enablement 35
Half of employees are F not getting adequate IN performanceenablement —suchasgoal setting D and tracking, feedback, IN and meaningful, ongoing conversations. G Performance enablement— comprisinggoal setting andtracking,feedback,and meaningfulandongoing 6 conversations—isan importantway tohelp employeesincreasetheir efectiveness and advance their careers. Thehalf of workers who said they get meaningfulperformanceenablementhad stronger feelings of belonging, higher productivity,and a better employeeexperience across the board. 52%ofemployeesreceiveadequate performance enablement.
F Whenemployees do not feel enabled, we I N seespikesinfeelingsofstress,overwhelm, D burnout,distraction, detachment, and I N pessimism.Theresults could hardly be starker. G 6 Employees who get good enablement are 2x as likely to feel they always belong and are valued at work. Always Sometimes Rarely Never Performance enablementisperformanceelevation.Itis Yes 53% 42% >4%
Enabledemployeesfeel moreproductive,engaged, andconfident. Lack of enablementcorrelates withhighstress andburnout. F Positive Sentiment I N Productive 65% D 55% I 52% N Confident G 31% 49% 6 Engaged 26% Optimistic 49% 30% Focused 43% 26% Resilient 24% Enabled 18% Notenabled Negative Sentiment Stressed 27% Thedatashowbetterresults 45% andsentiment across theboard Overwhelmed 23% —includingemployeefeelings 35% of productivity, confidence, 17% engagement,optimism,focus, Burnedout 40% andresilience. Whenemployeesdonotfeel Distracted 10% enabled, wesee spikesinfeelings 14% of stress, overwhelm, burnout, Detached 9% distraction, detachment, and 19% pessimism.Theresults could hardly 8% Enabled bestarker, or the case for enablement Pessimistic H morecompelling. 18% Notenabled O M E 2023 Global HR Research Report: The State of Performance Enablement 38
Technology plays acritical role in supporting Anotherfactorinfeeling enabled ishow Only 1in 4 employees have managersand employees so that positive integrated performancemanagement performance management F sentimentscantake root and flourish.The technologyisintotheflow of work.When integrated into the tools they IN numbersweseeabove trackclosely tothe employeeshavetologinandoutof systems, use every day numberof people whohavededicated tools they are far less likely touse them.Only23% D for performance managementand career of our respondentssaidtheir performance IN development. Doing boththeright waymatters. management process(e.g., feedback, check- ins, goal tracking, career development)isfully G Ofthe57%whosaidtheyhaveadedicated integrated into theapplications they use tool for feedback, performancemanagement, every day. 6 andgoal-setting, 31% like their tool. Another26%saiditisinsomeof theirtools, Similarly,only 53% of people have a process but51%of respondentstold us they have to or tool to documenttheir career aspirations interrupttheir flow of work and go toanother anddeterminethecompetenciesandskills platformfor performancemanagement —and they need toreachthem,andof those, 30% 28%dosoonlyduringannual review time. haveatool they like. Whenwelooked closelyat thosepeople who saidthey have (andlike) dedicated tools for performanceandcareerdevelopment, 92% saidthey felt adequately enabled —versus 26%of people withoutthosetools. What’smore, this group had better Onlyabout1in2 people experiences across theboard. A large haveaccesstodedicated majority (85%)said they saw aclearpathfor tools for feedback/ advancement intheir organization versus 26% of those withoutdedicated tools. performance or career/ Similarly,91% of thisgroupsaidthey thought skills development performancemanagementin their company was asuccess—a67-point improvement over thosewhodidn’thave either a performanceor career development solution. HO M E 2023 Global HR Research Report: The State of Performance Enablement 39
RECOMMENDATION F I N D Ask yourself if your performancemanagement approach is I yielding the results you want or is hampering or harming your N employees’ability to perform at their best. Do they view it as G biased, a waste of time, or diicult to maneuver? 6 If so, whatever investment you have madeis, at best, being wasted, and at worst, undermining employees’internal motivation, engagement, and sense of well-being. This could be costly to your business if lower productivity and higher turnover result. Whenwelooked at thosewhoseenablementisintegrated intothetools theyuseevery day,theywere: Modern performance management is really about » Upto20percentage pointsmorelikely tosay they performance enablement, not managing. It is: wereproductive • Forward-looking » Twiceas likely tosay they were being tasked to • Focusedonsettingagilegoalsthatalignwith work on the right things businessobjectives » 25-53percentage points more likely to say they • Achievement-oriented have an easy, intuitive, and flexible way to set, • Deliveredthroughfrequentandstructured update,and trackpersonal and professional goals conversationsand feedbackthat strengthen collaboration,trust,intrinsicmotivation,and a » 41-60 percentage points more likely to say their senseofaccomplishment currentperformancemanagement system helps • Reinforcedbyrecognizingand them to perform better in their work celebratingachievement Thisapproachelevatesandempowers yourpeople, H O culture,andorganization. M E 2023 Global HR Research Report: The State of Performance Enablement 40
C O N C L U S I O N KeyTakeawaysand NextSteps Thisyear’s survey results taughtus thatemployees generally prefer tostay and grow withtheircompanies. Itisconcerning, therefore, how few are getting the career developmenttheyneed tothriveandadvance inplace. Thisperfectly explains the disconnectwefirst noticed last year —where wesaw, andcontinuetosee, how manypeople arewillingtowalkaway fromcompanies theylove. Anothersurprise was thethemeof fairness —whichruns throughoutthefindings. Whenweconsiderhowreviewsandratings arethegatekeepersfor payand advancement opportunities,itisabsolutely critical thatemployersensureall employeeshaveanequalshotat aconsistent andfair employee experience. Throughoutthis report, wehaveofered recommendations for companies looking to improvetheemployee experience andtheiroverall employee deal. To learn moreabout thetrends, challenges, and issues most top of mindfor HR leaders —as well as thebest practices, strategies, and ideas the most innovative companies are applyingtosolve for them,visit: Betterworks Resource Center
A B O U T O U R S U R V E Y TheStateof Performance Enablement survey was 2 0 2 9 T O T A L R E S P O N D E N T S conducted by Betterworks from December20-22, 2022. This is thesecond annual deploymentof this survey. The Location Gender final sample of the survey was composed of 2029 randomly selected fully employed persons (aged 18 or older), balanced for gender andage, whoare employed at organizations withastaf sizeof 1,000or moreemployees. Respondents MALE: fromtheUS andtheUK wererandomly provided bythe UK:29% independent market research firm SurveyMonkey. The 45% survey hadamargin of error of +/-3 percentagepointsat a 95%level of confidence. USA:71% FEMALE: 55% Discover Betterworks Companieslike Colgate-Palmolive, Intuit,FreddieMac,andUdemy rely on Betterworksas their performancemanagement infrastructure —enablinggreat performancethrough dedicatedpeopletechnology. Betterworks’ best-in-class HR talentmanagement solutionsare designedtodrive exceptionalperformancebyputtingemployee experienceat theheartof how companies align, motivate, retain, anddevelop their people. UnlikelegacyHR technology, Betterworksis a lightweight,enterprise-readysolutionthatintegrateswith thetools. betterworks.com ©Copyright 2013-2023 Betterworks.All rights reserved. Varioustrademarks held by their respective owners.