Learning and talent management first moved from the realm of a support function to a mission critical application when we all figured out how to apply the technologies to everyday business problems. To make these applications even more “mission-critical” and to derive the greatest benefit, we have to figure out how to make these processes and technologies truly part of “everyday” activity. The networking dynamics in the “Web 2.0” world offer one great way to move in this direction.

To read an article on performance management and Web 2.0, click here
Excerpts about the article

“…All of this is a paradigm shift. Traditional talent management is controlled for the employee. When a worker undergoes a traditional performance review, he or she gets feedback. A rating of some kind is typically assigned, and instructions for development are delivered. In most cases, performance appraisals are rigid and conducted in a sort of broadcast method. Very little, if any, of the experience is self-directed.

Joining Web 2.0 tools to traditional performance management practices such as the annual review, 360-degree assessments and training, etc. gives employees a sense of independence. They can evaluate their competencies and take actions to improve productivity in a networked way, with peers, managers and colleagues providing support. In this way, Web 2.0 tools and traditional talent management technology mesh, and workers can seek out organizational experts and communities of practice as needed.

Talent executives easily can make a mistake attempting to integrate Web 2.0 and talent management. Integration can be a misnomer. A better way to think about the relationship between Web 2.0 tools and talent management is to ask how your organization can tap Web 2.0 to enhance employee performance…”

To read an article on performance management and Web 2.0, click here

Employee engagement is important, and yet another survey links employee satisfaction to the bottom line. This is a new research report from Wharton.

How Investing in Intangibles — Like Employee Satisfaction — Translates into Financial Returns

Contrary to management theories developed in the Industrial Age, employee satisfaction is an important ingredient for financial success, according to a new research paper by Wharton finance professor Alex Edmans. …he examines the stock returns of companies with high employee satisfaction and compares them to various benchmarks … His research indicates that firms cited as good places to work earn returns that are more than double those of the overall market.

Companies on Fortune magazine’s annual list of the “100 Best Companies to Work for in America” between 1998 and 2005 returned 14% per year, compared to 6% a year for the overall market, according to Edmans.
Sounds good to me!

China’s labor market is one of the most challenging in the world, and many companies list human resources as their top operating issue in China, largely because of rising labor costs and high turnover rates.

Two trends drive the consistently large salary increases and high turnover rates. First, foreign companies continue to invest heavily in China, and demand for talent remains high. Second, as first-tier Chinese companies transform their businesses to compete on the global stage, their expectations for talent are beginning to match those of foreign companies. The result is a persistently tight labor market for first-tier multinational and domestic companies operating in China.

Why do employees leave? #1 is compensation. Next is better career opportunity and tied for third is better benefits and better training and personal development opportunities.

More on China

http://www.talentmgt.com/performance_management/133/index.php

http://www.corpu.com/reports/chinaworkplace.asp

I have been working my way through Josh Bersin’s “High Impact Talent Management” research and pulled out a few things. First, this is not his report on vendors. It’s a survey of what companies are currently thinking. Here’s a few interesting pieces of information:

Average business impact of doing this process with excellence. Priority of impact to the business:

1. Performance management
2. Competency management
3. Sourcing and recruiting
4. Leadership development
5. Learning and development

One interesting point is that that performance management is “management itself” – the daily management of people.

Josh was stressing that organizations must have the processes first. The technology must support the processes. Organizations will see a 5-10 times higher ROI by focusing on the processes themselves; not the systems. Systems are enablers.

Performance management has the highest impact on business results. If it’s enterprise wide, it can drive 40% higher business impact than just having a few standards in place. Also, if enterprise wide, it also positively impacts Leadership development, career planning and pay for performance (and others). Why? It creates a common currency for the alignment and evaluation of people, it creates a culture of performance and it creates a dialogue and process for development.

No ROI for vendor Performance Management Systems

Bersin found that performance management systems are not yet showing return. Organizations haven’t had them long enough and the impact of PM is driven by process, behavior and culture. Performance management as a system must work before you automate it.