Change in performance management system during pandemic

Market is currently overflowing with the facts, comments, observations and suggestions related to one of the most critical HR functions of organization, performance management systems (PMS). PMS plays a critical role in aligning employee performance to achieve organizational goals collectively in a specific financial year for organizations. Incentivization and other rewards like promotions and recognition based on performance outcomes are critical decisions in any organization and result in employee motivation, productivity and engagement. PMS begins with performance planning (goal setting) for the entire financial year, facilitated by coaching and feedback processes to ensure compliance and goal achievements. Success of any organization’s PMS depends on the process of performance measurement and choice of the method for Performance appraisal.  Fair and equitable rewards motivate performers for working harder and smarter and earn more revenue for the organization. 

Lockdown due to COVID pandemic at the end of the financial year 2019-20 has disrupted the functioning of most of the organizations and its planned performance at all levels. This was a time for announcing bonus and other rewards for the performance for last financial year. And also to set a budget and goals for the next financial year 2020-2021. Instead the gloom of pay cuts and job cuts have descended in most of the Indian organizations. Uncertainty is looming large over some sectors like travel, tourism and hospitality sector and planning for performance is a challenge. Conventional ways of planning for performance and budgeting also need a relook. For example, traditional budgeting for current and next year is usually based on budgets from previous years with incremental percentage increases or decreases to meet new goals ranging from 1% to 10%. Budget utilization also becomes a leading indicator for next year's planning. Zero Based Budgeting (ZBB) is the most relevant approach in COVID times where all expenses need to be examined starting from a zero base. All critical activities for managing performance need to be evaluated with their utility and ROI.

PMS is usually explained through the analogies like a dashboard of a car or cockpit of a plane. It is a critical HR function and aligns employee performance for achieving organizational performance. During the total lockdown announced on 24 March 2020 in India major activities of most of the businesses halted. Recovering from those losses need critical review and fresh alignments for survival. Agility, flexibility and resilience of the organizations would become the success factors in such traumatic times. An interesting experience shared by Google engineers included the goal shifts from their past planned search directions for global sports etc to the search related to COVID, health and other related aspects. Similarly, disruptions in the supply chain has forced organizations to look at newer ways of procurement and distribution of goods and services. Investment in digitization and other technologies to facilitate work from home or from remote locations have thrown huge sets of challenges and opportunities. Many companies have started to close down the office premises and save the real estate costs to manage the current crisis.

Coaching, counseling and feedback have emerged to be the critical component for managing performance in COVID times. Economic, financial, personal or professional issues along with anxiety about one’s own wellbeing, wellbeing of families, friends, constant bombardment of information, data, advice, and expectation of magic solutions have given rise to increased physical and mental health hazards. Information overload, multi-tasking and lack of social interactions are leading to depressions. Spirituality, music, gaming and many newer ways are being used for addressing these issues.

Gaslighting during a pandemic has also increased. It is a form of psychological manipulation in which a person or a group, covertly sows seeds of doubt in a targeted individual, making them question their own memory, perception, or judgment, often evoking in them cognitive dissonance and other changes including low self-esteem. Using denial, misdirection, contradiction, and misinformation, gas lighting involves attempts to destabilize the individual and delegitimize the beliefs. Employees desirous of slowing down the work or trying to work differently and work less are gaslighted. 

In all, PMS has been severely impacted in COVID times and reinventing it to survive and succeed in COVID times needs innovative planning and renewed efforts.