Importance of Effective Communication during Annual Performance & Rewards Cycle
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73rd NHRDN Webinar on Importance of Effective Communication during Annual Performance & Rewards Cycle by Ms Leena Sahijwani, (Director – Rewards & South Asia Leader- Women’s Network, GE South Asia) on 29th May 2014
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Importance of Effective Communication during Annual Performance & Rewards Cycle
- 1. Importance of Effective Communication during Annual Cycle NHRDN Webinar May, 2014
- 2. 2 NHRDN Webinar May 2014 What will we cover today? Why focus on effective manager communication? How to prepare managers for important communication? Impact on engagement Impact on fairness perception Q&A
- 3. 3 NHRDN Webinar May 2014 Why focus on effective manager communication? Annual Cycle culmination of an year’s hard work for employee Managers determine ratings & rewards aligned with observations through this tenure HR invests significantly to create a fair and objective process Yet… Actual conversations leave much to be desired
- 4. 4 NHRDN Webinar May 2014 Performance Reviews
- 5. 5 NHRDN Webinar May 2014 Common Pitfalls… Managers feel nervous &/or unprepared Insufficient time for the discussion One Way Dialogue… no employee involvement Usage of “negative” words Generalizations Employee “shut down” before start Blaming the system
- 7. 7 NHRDN Webinar May 2014 Impact on engagement Employees report dissatisfaction with their performance management programs across organizations If delivered well If delivered badly
- 8. 8 NHRDN Webinar May 2014 Manager Effectiveness 37% 63% Effectiveness of Delivering Feedback Effective Managers Ineffective Managers
- 10. 10 NHRDN Webinar May 2014 Questions to ponder? Are trainings focused on “performance management system”? Do we train managers on “how to deliver performance reviews”? Does our performance management system focus on developmental plans/ improvement plans? Do we gather feedback on performance appraisal delivery effectiveness?
- 11. 11 NHRDN Webinar May 2014 Effective performance review delivery involves… Scheduling sufficient time…without interruptions Rehearsing the conversation… anticipating questions Providing performance review document before starting the meeting Soliciting employee inputs Being honest and articulate
- 12. 12 NHRDN Webinar May 2014 Effective performance review delivery involves… “Sandwich”: Strengths > Developmental Feedback > Encouragement Focusing on employee behaviours Providing specific examples Offering support and suggestions to improve areas identified Continuing the dialogue on development plan
- 13. 13 NHRDN Webinar May 2014 Do your managers… Avoid difficult questions, referring them to someone else? Does this make employee feel less valued? Become defensive if encountered with negative employee reaction? Prepare them to respond calmly to negative reactions by Allowing employees to speak openly Understanding signs of emotional reactions Remaining calm themselves Express dissatisfaction with performance management system Must Own Feedback to maintain their own credibility Discuss other employee’s ratings or makes comparisons Instead explain types of behaviours necessary to achieve a rating
- 14. 14 NHRDN Webinar May 2014 Invest in Performance feedback communication training Role Plays Case studies Managing adverse situations Solicit employee feedback on delivery to shape future process/ system enhancements Development plan focused approach to make improvement “real”
- 15. 15 NHRDN Webinar May 2014 Rewards Communication
- 17. 17 NHRDN Webinar May 2014 Positive Pay Perception improves Engagement Pay perception is determined by fairness attached to their pay decisions Internal and external equity critical How are people paid within my organization? How are people paid outside my organization?
- 18. 18 NHRDN Webinar May 2014 Pay Perceptions shapes by Pay Communication 62% 38% 0% 20% 40% 60% 80% Pay Communication Pay System Effect on Perceptions of Pay Process Fairness Effect on Perceptions of Pay Process Fairness
- 19. 19 NHRDN Webinar May 2014 Benchmarking Compensation information from organization impacts engagement positively Informal sources negatively effect engagement Organizational information often inadequate resulting in informal “chatter”
- 21. 21 NHRDN Webinar May 2014 Questions to ponder? Do we train managers on “how to communicate pay outcomes”? Are the managers in our organization “compensation/rewards spokesperson”? Do we have a mechanism to communicate directly with employees on pay increase information?
- 22. 22 NHRDN Webinar May 2014 Effective pay decision delivery involves… Preparation Gathering information about employee- positioning within range, compensation & performance history Identifying issues that may emerge and preparing responses Ensuring un-interrupted discussion with key messages rehearsed
- 23. 23 NHRDN Webinar May 2014 Effective pay decision delivery involves… Communicating Overall process involved in decision making Benchmarking process Factors involved- individual contribution, individual pay positioning, budget Salary increase guidelines & it’s application for individual Key performance messages… linkage of pay to Rewards
- 24. 24 NHRDN Webinar May 2014 Manager Communication • Demonstrating ownership • Understanding rationale of salary guidelines well • Ensuring availability of right level of information prior to planning • Ensuring employee understands rationale of decision • Informing employee’s positioning vs. range • Communicating in time… • Dismissing as someone else’s responsibility • Leaving things to last minute • Skirting the issue… concerns don’t go away by ignoring it • Asking employees what they were expecting… it’s bound to be more! • Committing to increase the salary • Revealing someone else’s pay outcome • Going into discussion without homework
- 25. 25 NHRDN Webinar May 2014 Invest in Ensuring managers understand compensation concepts well Ongoing training Specific training prior to launch of key programs/ changes in pay approach Provide toolkit to help communicate Key messages on budget, process, concepts Solicit employee feedback on delivery to shape future process/ communication enhancements
- 26. 26 NHRDN Webinar May 2014 Effective pay decision delivery involves… Communicating Overall process involved in decision making Benchmarking process Factors involved- individual contribution, individual pay positioning, budget Salary increase guidelines & it’s application for individual Key performance messages… linkage of pay to Rewards
- 27. Quality of delivery of Performance Reviews & Pay decisions directly impacts engagement Building quality “delivery skill” amongst our managers critical We owe appropriate feedback & rationale for pay increase to our employees In summary..