Transcript
Mark:
Welcome to PeopleTech, the podcast of the HCM Technology Report. I’m Mark Feffer. Today, my guest is Arnaud Grunwald, the chief product officer at Betterworks. They’re known for their goal setting and performance management solutions which are used by employers around the world. We’re going to talk about bringing performance management into the technologies modern world, the role technology plays in today’s solutions and how to keep customers happy all on this edition of People Tech.
Mark:
Hi Arnaud, it’s good to see you. You certainly pay attention to all that’s going on with performance and performance enablement out there in the world and what are your thoughts about where it is and where it’s going?
Arnaud:
Yeah, I think we are at an interesting turning point in the space of performance management. It has of course, a reputation of an old painful process that is taking a lot of time from teams from for not a lot of value and technological advances, and also process improvement advances have made that we are now in a space where forward thinking organizations are transforming the performance process into what we call a performance enablement process that is more lightweight, less painful, that is more continuous so it is less biased and it is not your end of your performance review only, it is something that engages employees with their managers and with their peers on a more frequent basis that is based on feedback and that is based on goal execution as well as employee development. I think in the past, some companies were very focused on strategy execution, goal management and were forgetting a little bit about what’s in it for the employee.
Arnaud:
Some organizations were completely focused on the employee and the development on the HR side of things, but not enough on the strategy execution and the completion of objectives and now we have processes that have been invented and tools that have been developed to support these processes that marry these two sides of the world in a very nice way. It is very important for a company to achieve their objectives, but you can’t do this without having fruitful conversations with your manager, where employees receive coaching and feedback on a continuous basis, but also not only to achieve their short term objectives, but to see themselves long term in the company and to know that the company wants to invest in them and has a career baked in for them.
Mark:
And what’s technology’s role in all this? I mean, would performance enablement and other approaches that are speeding up and making performance management more dynamic, would they be possible without the sort of technical tools that we’ve got available today?
Arnaud:
In theory, yes, but maybe the sad part of our lives is that we’re spending time in front of a computer so it is our goal at Betterworks to embed performance enablement activities everywhere you already are, right? Technology is necessary because you want to input data, you want to report on data, you want to make sure people are having goals, you want to make sure people are having these conversations are receiving feedback. You want to make sure that everybody has an equal opportunity in the company and so logging these data and being able to report on it is where technology helps. What has not worked for technology in the past is that performance management was a place where you had to go. You would be coerced by HR or your manager to complete a process, to check a box and that has participated to the bad reputation that performance management has.
Arnaud:
We’re entering in a new era where performance management is in the flow of work. There’s a recent article by Josh Burson that talks about performance management in the flow of work where performance management is not the place where you go. Performance management is a set of healthy, daily habits that you should have, and that are emerging in the tools that you already use. For instance, how crazy would it be to think that you can request feedback from someone as you’re reading someone’s email? How crazy would it be to imagine that you are in Slack and that you want to see your direct reports objectives and how they’re tracking on it so that you can have a good one-on-one conversation with them? How crazy would it be that you are in Microsoft Teams and that you are seeing a team outperform and reach their objectives ahead of time and that you would want to provide them with official recognition in the tool itself?
Arnaud:
So that’s where technology comes in today. It’s the performance management, as we know it is now being infused in the tools that we use in our daily lives, such as Gmail, Outlook, Microsoft Teams, Slack and others and it makes for a much better user experience in that it makes for more timely data input, for reporting for HR and managers and we think it’s bringing a tremendous value to organizations. As a matter of fact, I was just talking to one of our customers this morning. It’s a very large sort of new tech transportation company that is growing very rapidly and they have noticed, after launching Betterworks, an employee net promoter score increasing by six points six months’ ago and by 13 points as of their last reading in June.
Arnaud:
So we’re really seeing people being much more satisfied in the workplace and enthusiastic about their work because they’re having these frequent check-ins where their managers in a way that makes a lot of sense and that doesn’t institute major friction for them. In that example, they’re even using our mobile application. So they’re doing their conversation with our managers on their mobile phones, and they can do that anytime, they can do that during the break, they can do that in the bus and it’s done, but at least we provide the real estate for them to get the coaching and to know that they are important to the organization and that they have opportunities to get feedback and continuously improve.
Mark:
And that sort of touches on my next question, which is, where did this all originate? I read a lot of things that say performance management is a big part of the employee experience. It’s a big part of employee engagement. So is it employees who are driving this, or is it employers who are driving this?
Arnaud:
That’s also part of the transformation that’s happening today. In the past, performance management was definitely driven top down. It was an HR process, a check the box exercise, a compliance exercise that was in company’s constitution so to say. Every employee needs to have a performance review because we need to know, we need to have some data to decide how much to raise their salary and when to promote them or when to manage them out. Now, the world has turned upside down and employees, individual contributors, have taken much more of an active role in how they want to contribute to the culture, to the company results, to their own career. So now the process should be, and is much more employee centric, employee driven. It is still a program that is led, that is guided by HR and management but the focus is on the employee.
Arnaud:
The focus is when you talk about goal management, it’s no longer who’s accountable for this and who’s going to be scolded if they don’t achieve their objectives, it is how can we make sure that employees understand how they fit in the bigger picture? What piece they are in the bigger puzzles, so that they are motivated and engaged and have more chance to accomplish their objectives. It is not about, hey, let’s just ensure that we have the proper training for our employees because training is a nice perk and we need to make sure they’re trained to get, to accomplish their objectives. It is more from a career management perspective. How can we make sure that employees feel like we’re investing in them and that they have a future in our company, that this is not just a stint, but it is a career that we want for them, that we are talking to them about their next role in the company, that we are talking to them about skills and competencies that they can develop.
Arnaud:
And we also have a survey tool at Betterworks where we do engagement surveys and when we do engagement surveys with our customers, what is consistently coming from these surveys is that employees value that way above their level of compensation. The fact that companies, that they feel like they matter, they feel like the company has a path to greater success for them. That’s always a number one driver of retention and engagement versus things that could be obvious but that are not true like compensation is the number one driver for retention.
Mark:
And it sounds like this is going to be more labor intensive or require more time from managers because they don’t get away with just a one time, once a year sit down with their employee. So how are managers reacting to it? I mean are they resistant? Are they seeing benefits to it? So they’re very positive about it?
Arnaud:
Yeah, you’re right. It’s the latter. It all comes down to value. If the tools that new age performance management or performance enablement provides make their lives easier and make their teams more successful. So would you rather have a team that is struggling all year long, but you have only one time to provide performance reviews? It’s a painful time but let’s do it and it’s done or would you rather have a team that is engaged, enabled, performing and has the right behavior? So it all comes down to value and the value that managers get from the processes is also incredibly higher than in the old world. I also want to mention that managers’ life these days, it’s not easy, especially in the remote setting. A lot of managers have been promoted managers in a remote setting. They have not had manager training. They don’t have, it’s really hard for them to have role models on Zoom and to learn from role models on Zoom.
Arnaud:
What continuous performance management provides is a structured way to have conversations with your employees. We help managers by telling them which questions, which topics they should talk about with their employees. We help them with structure and guidance to drive based in class behaviors, as opposed to leaving them by themselves without any guidance all year long so I think it’s also part of the value of this sort of raising the bar for all managers and helping them hear that bar with guidance through technology.
Mark:
And is this getting to a point, or is it at a point where it’s pretty much mainstream or is it still a relatively small number of companies who are pursuing performance management this way?
Arnaud:
It’s definitely started in the startup world, because it’s easier to implement that way. Flexible and agile objectives and quick check-ins with your manager, et cetera, but like all things, you have early adopters and then you’re crossing the chasm. And as you’re saying, I think we see it going mainstream. For instance, with large, 15,000, 20,000, 50,000, 150,000 employee organizations adopting these new methods of doing performance management in their organizations. So yes, it is still the forward thinking organizations that adopt these new ways of doing performance management but we see that it’s not just the startups and the fast growing SMBs that are adopting it, it’s also the enterprise companies that are realizing that if they want to keep their employees, they have no choice.
Arnaud:
They have, it’s a major part of employee engagement and employee retention to make people understand how they fit in the bigger picture, what role they play, how they contribute to company’s success and what’s in it for them in terms of personal growth and career growth and you can’t do that with the old way of doing performance management so I believe, one way or another, everybody is coming on board in a very short order.
Mark:
It still must be pretty challenging for employers to implement this. I mean, they have to install the technology like Betterworks and train and all of that. Do they… What do you hear from employers when you’re going through that process with them? Is it sort of grudging or is it more open and excited?
Arnaud:
Yeah, like any technology change, it creates stress and anxiety and it needs to be managed, the change needs to be managed and I’m not here to advertise Betterworks in particular but what we see is that providing our customers with services is as important as providing our customers with best in class technology. We are a technology company, but we would not be successful if we did not have a stellar onboarding, implementation, customer success and support organization because yes, customers need to feel like we are there for them. They need us to guide them with best practices that we see in other customers so that they don’t end up reinventing the wheel every time. They want to make sure they’re using best practice templates and processes and that we are holding their hand or, if you will, that we provide a third wheel until they are comfortable enough that we can remove the third wheel.
Mark:
Arnaud, thanks very much for taking the time this afternoon. It was great to talk to you and I hope you’ll come back.
Arnaud:
Thank you. Thank you so much, Mark.
Mark:
My guest today has been Arnaud Grunwald, the chief product officer at Betterworks, and this has been PeopleTech, the podcast of the HCM Technology Report. We’re a publication of recruiting daily. We’re also a part of Evergreen Podcasts. To see all of their programs visit www.evergreenpodcasts.com and to keep up with HR technology, visit the HCM Technology Report every day. We’re the most trusted source of news in the HR tech industry. Find us at www.hcmtechnologyreport.com. I’m Mark Feffer.
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