New Paths in Performance Management

My mom is an independent insurance agent. She recently shared with my brothers and me that she had achieved renewals with more than 95 percent of her clients. I jokingly inquired, “Why not 100 percent?” Then my older brother chimed in, “Fire the bottom 10 percent of your staff until renewals are 100 percent!”

She is a staff of one, so I am not sure what that looks like.

My brother’s joke might sound a little extreme, but it is rooted in a real-world example. When Jack Welch was the CEO of GE, he asked managers to rank their employees annually. The bottom 10 percent were then encouraged to find employment elsewhere.

We recently had a GE leader share with us that the company has changed its performance management policies, and this particular practice no longer occurs. Instead, leaders help employees improve their contributions to overall company goals. In order to change the company mentality, GE’s entire performance management process had to change.

Setting goals and monitoring progress

Performance management is the process of setting goals and monitoring progress towards them. In many large organizations, managers formalize this process with the annual performance review.
Food and agribusiness managers are reevaluating performance management systems. In the process, managers are shifting away from annual reviews, eliminating rankings of employees, focusing on improving the collection and use of data, and incorporating talent and performance management into the executive suite of decision-making.

The biggest change firms are undertaking aims to improve the quality and frequency of feedback on employee performance. There has been a stampede away from setting goals in January and then waiting until next January to monitor progress toward achieving those goals. Instead, managers are opting to help employees set goals that are of differing time horizons. Then managers collaborating with human resources to put systems into place that track progress quarterly, monthly, or even more frequently. The formality of the process is crumbling. Employees are more receptive to frequent, less formal feedback. Employees are able to course correct more quickly and focus on improvement.

Firms are also doing away with rankings of employees as the basis for determining pay raises and promotion decisions. Instead, managers are focusing on the career goals of the individual and aligning them to company goals. The most effective managers provide mentoring to employees who are underperforming. Often managers are responsible for removing hurdles so that employees can improve and grow. The new systems focus on understanding each individual’s contribution to the team and company efforts and reward the employee befitting that.

Progressive Performance Management

Progressive firms are on the cutting edge of collecting and using data to improve performance management. As GE moved away from the old model, it opted instead to collect frequent feedback on employees and managers. GE developed an in-house app to facilitate quick, real-time reporting of progress. Employees often leave meetings typing into the app what peers should continue doing and consider changing.

Progressive firms are also moving away from HR as an administrative center that processes hiring contracts and benefits to one that is a strategic partner in executing firm strategy through employees. Purdue research shows that in agribusiness, firms rate poorly on performance management when the HR function is entirely administrative. Employees rate firms as doing well on performance management when they view HR as a strategic partner. It is when HR collaborates with managers in other functional areas that performance and talent management have the biggest payoff. In this system, HR creates systems that empower managers to be successful leaders.

Managing Talent to Win

Performance management is just one of the elements of overall talent management that leaders often struggle to get right. Things such as succession planning, talent acquisition, engagement and retention and more come with their own unique sets of challenges.

Purdue University’s Center for Food and Agricultural Business recognizes these challenges and is here to help managers succeed in the talent management realm. June 25-27, we will offer Managing Talent to Win, a professional development program focused on helping managers at all levels attract, support and retain quality employees who will help their companies continue to improve.

Learn more at


Data-Driven Decision Making in Times of Crisis: Data Collection

This article examines the act of collecting, organizing and storing selected data and information that has been identified as needed. The objective is to create a process that allows for timely availability of the most relevant data for transformation into intelligence.

Data-Driven Decision Making in Times of Crisis: What Data?

In our previous article (Data Driven Decision Making in Times of Crisis), we discussed the importance of making decisions based on insights derived from data and information. In other words, the article focused on having an intelligence-driven approach to the decision making process. Decision makers need the right information at the right time in the most useful and trustworthy form to be able to make well-informed decisions in an uncertain environment. A key question arising from our intelligence framework is: What data/information is important? Or, more precisely, what data/information is necessary to inform our decision?

Potential Learnings and Changes for a Post-COVID-19 Food and Agribusiness Industry

COVID-19 has sent shock waves throughout the world, challenging every aspect of life. During this time of great tragedy and uncertainty, peoples’ daily lives have been disrupted in an abundance of ways. The concepts of communication, distance, work, food and even shopping are suddenly being redefined. In the food and agricultural business world, this tragedy has resulted in the examination of many aspects of business from the design of supply chains to impacts on consumer buying behaviors to the future of international trade. Has this massive disruption brought a new awareness to risk preparedness, co-dependencies in supply chains and the risks of the pursuit of efficiency at all costs? What are the ramifications of forced use of technology to communicate, buy and arrange for deliveries on the selling and buying functions of farms and agribusinesses? Have we shifted to a longer-term view where things like climate change and sustainability are embraced as part of the grand challenges of the industry, or have these issues been placed on a back burner as we focus on the here and now? Have we started to think about and implement new performance metrics that measure the industry and firm survivability, not just profitability? Ultimately, in the aftermath of this global tragedy, what can we learn about the future of the food and agribusiness industry that can help us create more resilient markets, supply chains, firms, leaders and employees?