Asia-Pacific region has most sophisticated performance management practices: Mercer

Organisations in the Asia-Pacific region have the most sophisticated performance management practices, Mercer’s 2013 Global Performance Management Survey reveals.

The survey showed “Goal setting at the country level occurs most often in South Korea and India, and least often in the United States and Canada.”

In the US and Canada, goal setting is lower because the level of conversation between manager and employee is higher.

Organisations in India, Singapore, Japan, and Eastern Europe are more likely to demonstrate higher levels of executive commitment to performance management while those in Latin America, Italy, and Spain are least likely.

Although the top practice of performance management programmes worldwide is linking performance to pay increases, organisations in India track performance management metrics significantly more than all other countries.

Mercer is a wholly owned subsidiary of Marsh & McLennan Companies, a global team of professional services companies offering clients advice and solutions in the areas of risk, strategy, and human capital.

The survey includes responses from performance management leaders at more than 1,050 organisations representing 53 countries. The organisations surveyed varied in size from fewer than 1,000 to more than 10,000 employees, and included a wide range of industries

It showed that despite an understanding that talent is a source of competitive advantage, establishing effective performance management programmes remains a challenge for most. “Just 3 per cent of organisations worldwide report their overall performance management system provides exceptional value,” it said.

Said Colleen O’Neill, Senior Partner at Mercer, “Even though there is a lot of talk about workforce segmentation and innovative performance management practices, few effectively support dynamic performance and career development processes, and a minority of companies has made revisions to their practices in the last few years.”

In addition to some commonalities in performance management programmes, such as setting employee goals, and conducting formal year-end review discussions, the survey identified managerial skills, executive commitment, calibration, and technology, among others as some of the key drivers of these programmes.

According to the survey, roughly one in three organisations around the world say improving managers’ ability to have candid dialogue with employees has the greatest impact on overall company performance.

Mercer’s analysis revealed that the two components of manager skills that matter the most are linking performance to career development and setting SMART goals (specific, measurable, ambitious but achievable, relevant, and time-bound).

Alongside the contribution of managers, organisations with higher levels of executive commitment are more likely to have effective performance management programs, said the Survey.

“Despite this focus on the front-end of the performance management process, many Asian countries are trying to quantify performance in terms of behaviors and goals to support potential need in high growth markets,” said Kate Bravery, Principal, Leadership & Talent Solutions Leader, Asia and Middle East.

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