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THE ILLUSION OF MEETING EXPECTATIONS 01 MIND THE GAP PERFORMANCE MANAGEMENT IS NOT AS GOOD AS YOU THINK IT IS 02 GAME CHANGERS FOR BUSINESS CONVERSATIONS AND FEEDBACK 03 MIDDLE MANAGEMENT CRISIS THE SQUEEZE IS REAL 04 “GOOD ENOUGH” ISN’T WHAT YOU LEAVE ON THE TABLE WITH AN HCM-ONLY APPROACH 05 MEET THE MOMENT DELIVER IMPACT THROUGH SKILLS-BASED PERFORMANCE MANAGEMENT 06 GOAL-GETTERS THE HIGH FLYERS OF PERFORMANCE CROSSING THE GREAT DIVIDE The Big Disconnect THE STATE OF PERFORMANCE ENABLeMENT THE BIG DISCONNECT 2024 Global HR Research Report Explore report 2,105 Respondents 20 Industries 45% IC’s 35% Manager (non-HR) 15% Director or above 5% HR manager or above 71% USA 29% United Kingdom 1,000+ EE Companies Full-employed Workers Age & Gender Balanced THE ILLUSION OF MEETING EXPECTATIONS A few words on terminology Pre-register for full report Productivity is top of mind in 2024. In the race for results, leaders have been tempted to shift focus from guiding performance to tracking output. But if you think current performance management practices are ‘good enough’ to meet the bar, you could be wearing rose-colored glasses. Many executives are. Our latest research shows a shocking perception gap between the experience of performance management for leaders and HR versus everybody else. The right support tools and processes are also key. Disconnects in access to manager-employee conversations, feedback, development, and goal management track with a tumble in outcomes like productivity, belonging, and alignment — which all directly impact performance. So is the current system “good enough” to drive gritty 2024 productivity goals? All signs say no. If companies want to see performance boom, they can’t sleep on managing it. Instead, they must identify and bridge these gaps — and double down on meaningful performance support. Employees are 0% less likely than leaders to think performance management processes are a success High productivity jumps 0% when performance management processes succeed Employees are 0x more likely to see a path for advancement in their company when performance management is a success TOP FINDINGS FROM THE REPORT Explore Findings 01 MIND THE GAP PERFORMANCE MANAGEMENT IS NOT AS GOOD AS YOU THINK IT IS 02 GAME CHANGERS FOR BUSINESS CONVERSATIONS AND FEEDBACK 03 MIDDLE MANAGEMENT CRISIS THE SQUEEZE IS REAL 04 “GOOD ENOUGH” ISN’T WHAT YOU LEAVE ON THE TABLE WITH AN HCM-ONLY APPROACH 05 MEET THE MOMENT DELIVER IMPACT THROUGH SKILLS-BASED PERFORMANCE MANAGEMENT 06 GOAL-GETTERS THE HIGH FLYERS OF PERFORMANCE 01 MIND THE GAP PERFORMANCE MANAGEMENT IS NOT AS GOOD AS YOU THINK IT IS 01 EXECS AND HR GIVE PERFORMANCE MANAGEMENT AN A+ BUT 4 IN 10 EMPLOYEES SAY IT’S A BIG FAIL. There’s a dangerous disconnect in performance management. Leaders and HR see performance management through a rosy lens. For them, manager conversations, peer feedback, reviews, goals management, and career/skills development are overwhelmingly working. For employees and their managers — not so much. This gap has a real impact on outcomes. Individual contributors are 17% less likely to say they are very productive, 37% less performance-enabled, and 3x less likely to feel supported in their skills development. Managers also rate these factors lower than leaders — especially when it comes to productivity, where they dip even lower than individual contributors. How does the gap impact employee and manager performance and churn? FIND OUT IN THE FULL REPORT. COMPARED TO HR AND LEADERS, INDIVIDUAL CONTRIBUTORS ARE: 0% less likely to feel performance-enabled 0% less likely to feel productive 0X less likely to feel supported in developing skills A FAILING GRADE FOR PERFORMANCE MANAGEMENT 0% Individual Contributors 0% Managers 0% Exec/HR 02 GAME CHANGERS FOR BUSINESS CONVERSATIONS AND FEEDBACK 02 1 IN 5 EMPLOYEES IS NOT GETTING CONVERSATIONS OR FEEDBACK, AND IT IS CRUSHING THEIR GROWTH. Manager conversations and peer feedback are game-changers for retention and productivity — but more than 1 in 5 employees are still not getting either. This has a manifest impact on outcomes, at a time when top talent is in demand and skill gaps are a big concern. Fissures between the “haves” and “have nots” directly map to shortfalls in how supported employees feel in their performance, their ability to build their skills, and whether they see a path for growth in their organization. Do 1:1 and peer feedback technologies make performance reviews more relevant? FIND OUT IN THE FULL REPORT. 0 in 0 individual contributors don’t get manager 1:1s 0 in 0 receive no peer feedback HAVES VS. HAVE NOTS HAVES Get manager conversations and peer feedback HAVE NOTS Don't get manager conversations or peer feedback Feel performance enabled 0% 0% Always able to grow skills 0% 0% See an internal path for career advancement 0% 0% 03 MIDDLE MANAGEMENT CRISIS THE SQUEEZE IS REAL 03 PEOPLE MANAGERS LACK THE CLARITY AND SUPPORT THEY NEED TO DELIVER RESULTS. Middle managers serve as the bridge between leadership's vision and strategic direction, and the execution of these by employees. They support teams relationally and help employees remain on track and engaged. Yet, underinvestment in managers coupled with high expectations from all sides threatens to undermine the foundational support they provide. Our data shows them squeezed from all sides — struggling to stay effective and productive. There is a troubling disconnect between the level of assistance people managers say they receive and the level of support that higher-level managers, HR, and leaders feel. Only about 1 in 3 middle managers said they have the clarity, organizational support, and resources to succeed and to coach employees effectively on skills and career development. How are managers dealing with high workloads and low support? FIND OUT IN THE FULL REPORT. 0 out of 0 people managers lack clarity on their role 0 out of 0 people managers need support delivering performance management 0 out of 0 people managers need support guiding employees on skills and career development 04 “GOOD ENOUGH” ISN’T WHAT YOU LEAVE ON THE TABLE WITH AN HCM-ONLY APPROACH 04 HCMS PERFORM 70% BETTER WITH AN ASSIST FROM PURPOSE-BUILT PERFORMANCE MANAGEMENT SOFTWARE. When it comes to managing performance, the data shows that HCMs perform no better than manual spreadsheets — and in a few cases, they are worse. Yet, two-thirds of respondents use an HCM or ERP system precisely for performance-related activities. Clearly, a majority of employees and organizations are missing out on the multiplier effect of modern performance management by relying solely on large, one-size-fits-all systems. Combining an HCM with a purpose-built, best-of-breed platform for performance management boosts outcomes across the board for engagement, belonging, enablement, goals relevance, career development, and opportunities for advancement. What technology features are most important to employees? FIND OUT IN THE FULL REPORT. HCMS ARE 70% MORE EFFECTIVE WITH AN ASSIST FROM PURPOSE-BUILT PERFORMANCE MANAGEMENT SOFTWARE.* HCM ALONE HCM + DEDICATED SOFTWARE Program sucess *Average success across all performance management programs. Manager Conversations 0% 0% Peer Feedback 0% 0% Ratings & Reviews 0% 0% Goals Management 0% 0% Career & Skills Development 0% 0% 05 MEET THE MOMENT DELIVER IMPACT THROUGH SKILLS-BASED PERFORMANCE MANAGEMENT 05 COMPANIES ARE FAILING 1 OUT OF 2 EMPLOYEES IN DEVELOPING SKILLS AND CAREERS. Organizations are hyper-focused on building skills to make the best use of their talent while fortifying their ability to address constantly changing conditions. And employees desire similar security and promise. Employees at all levels told us they want skill and career development — but only 54% rate these programs as a success. The addition of purpose-built solutions yields dividends. Employees with software specifically designed for performance management were nearly 3x more likely to feel they always receive the support they needed to develop their skills and nearly 2x more likely to say they see a clear pathway for advancement in their company than those relying on only an HCM for skill development. Are your managers equipped to support employee skills development? FIND OUT IN THE FULL REPORT. - 0% of employees say career and skill development and coaching are important to them Only 0% are getting it 0X more likely to receive support for building skills 0X more likely to see a way to advance internally EMPLOYEES SEE A CLEAR PATHWAY FOR ADVANCEMENT IN THEIR COMPANY. 0% HCM + Purpose-Built Software 0% HCM Only 0% No Software 06 GOAL-GETTERS THE HIGH FLYERS OF PERFORMANCE 06 PRODUCTIVITY AND FEELINGS OF BELONGING SOAR WHEN EMPLOYEES FEEL ALIGNED TO COMPANY GOALS. Organizational impact goes hand in hand with goal alignment. Employees say they are more productive when they are able to set and accomplish goals in sync with their company’s goals. And they are 3.6x more likely to feel those goals align when they have frequent manager conversations, coaching, and feedback. Here, again, purposeful technology matters. The combination of an HCM plus a purpose-built solution was a winner for 92% of respondents. And sometimes, the wrong technology can be worse than having none at all — HCMs without the addition of a purpose-built solution produced even less alignment than manual solutions. What happens when employees when employees don’t feel aligned? FIND OUT IN THE FULL REPORT. - 0% rise in very productive employees when they have goal alignment Belonging jumps 0X when people feel their goals align to company goals EMPLOYEES FEEL THEIR GOALS ARE ALWAYS RELEVANT TO AND HELP THEIR ORGANIZATION TO ACHIEVE ITS OVERALL GOALS. 0% HCM + Purpose-Built Software 0% HCM Only 0% No Software CROSSING THE GREAT DIVIDE The 2024 State of Performance Management report exposes striking disconnects in experience — whether based on organizational role or access to effective tools and thoughtful performance management processes. The impact these factors have on outcomes that matter most to organizations makes clear the vital need to bridge the experience gap — a need that will only become more crucial as enterprises race to meet the demands of the marketplace and the needs of their workforce. Our full report will be released in early April. SIGN UP HERE TO RECEIVE YOUR COPY. DISCOVER BETTERWORKS Founded in 2013, Betterworks is the pioneer in intelligent performance management solutions that help workforces and organizations achieve their highest potential. Betterworks reimagines performance management for all with an enterprise-ready platform that fosters greater manager effectiveness and employee performance, leading to higher satisfaction and retention and better business outcomes. Our customers’ employees are proven more engaged and satisfied in their roles, which is why industry leaders like Colgate-Palmolive, Intuit, Udemy, Freddie Mac, Kroger, Vertiv, and the University of Phoenix rely on Betterworks to manage and enable excellent performance. Betterworks is backed by Kleiner Perkins, Emergence Capital, and John Doerr. Copyright 2024 Betterworks Systems Inc. All rights reserved. Various trademarks held by their respective owners. A FEW WORDS ON TERMINOLOGY We use the terms HCM, ERP, and purpose-built performance management solutions in this report. Here are their definitions: HCM (human capital management) – An integrated suite of technologies that help companies manage all aspects of the employee life cycle overseen by HR, including recruiting, training, payroll, compensation, and performance management. ERP (enterprise resource planning) — Software that organizations use to manage day-to-day business activities such as accounting, procurement, project management, risk management, and supply chain operations. Purpose-built performance management — Software that is specifically designed for performance management, enabling lightweight and continuous performance enablement in the flow of work through agile goal-setting, manager-employee conversations, peer feedback and recognition, and employee surveys. SIGN UP HERE TO RECEIVE A COPY OF OUR FULL REPORT. To be released in early April. * * Dive deeper into our findings at our April 18th roundtable. * I'd like to receive more information from Betterworks, Inc., with the understanding that I can opt-out at any time. I understand and agree to the Betterworks' Terms of Service and Privacy Policy. Opting in for additional information is not required to receive this content. All data is protected and secure, as outlined in our Terms of Service and Privacy Policy. Submit THANK YOU FOR SIGNING UP FOR THE REPORT! SHARE 2024 Global HR Research Report The State of Performance Enablement https://report.betterworks.com/ Copy