Analysis of New Trends in the Global Business Environment Report

This report provides an in-depth analysis of new trends in the global business environment, focusing on the case study of Deloitte and their approach to reinventing performance management. The report begins with an overview of the challenges associated with traditional performance management methods, such as 360-degree feedback, and highlights the inefficiencies and negative impacts these methods can have on employee engagement and performance. The study then delves into Deloitte's strategies for creating a more nimble, real-time, and individualized performance management system. Key themes explored include the crisis of credibility in HR, the impact of performance reviews on employee engagement, and the importance of motivating employees through frequent feedback and modern pay-for-performance models. The report also examines the sources of secondary data used, including the Harvard Business Review article "Reinventing Performance Management." The conclusion summarizes the key findings and emphasizes the need for companies to adopt innovative performance management approaches to improve employee performance and overall business outcomes.

Running head: NEW TRENDS IN GLOBAL BUSINESS ENVIRONMENT
New Trends in Global Business Environment
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2NEW TRENDS IN GLOBAL BUSINESS ENVIRONMENT
Table of Contents
Research Questions..........................................................................................................................3
Literature Review............................................................................................................................3
Reinvent performance management............................................................................................4
Suggestions to reinvent performance management.....................................................................6
Theme 1: Crisis of credibility..........................................................................................................7
Theme 2: Performance review leads to:..........................................................................................7
Theme 3: Motivating Employees.....................................................................................................8
Theme 4: Modern pay for performance...........................................................................................8
Linking pay to performance.........................................................................................................8
Sources of secondary data...............................................................................................................9
Conclusion.......................................................................................................................................9
Reference List................................................................................................................................10

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Brief Summary of the core article
The title of the research title selected for the study is “Reinventing performance
Management” (Buckingham and Goodall 2015). At Deloitte, they realized that the performance
management is used for evaluating the work of employees where the company train, promote
and pay the employees based on their experiences, expertise, job role and job position. The
company decided to implement new system that will have no cascading objectives. In order to
plan for a new system, Deloitte drew on different pieces of evidence that is simply count hours as
well as carefully controlled study of own business and a review of research in the science of
ratings. The case study is related to the audit firm named as Deloitte and published on 22nd
February 2017 in Harvard Business Review (Buckingham and Goodall 2015).
Deloitte is one of the audit firms that provide professional services to their clients. The
audit firm is the largest professional service network in and across the world in terms of revenues
as well as number of present professionals. In the year 2013- 2014, Deloitte generated revenue of
$34.2 billion USD. It is therefore decided by Deloitte to take on reinventing performance
management for smooth functioning of business enterprise (Van Dooren, Bouckaert and Halligan
2015).
Both Marcus Buckingham and Ashley Goodall had properly explained the process as
well as findings of the large-scale audit firm named as Deloitte (Buckingham and Goodall 2015).
The information was presented in form of performance management survey and published on
Harvard Business Review. It is now important to find out how Deloitte changed the approach to
performance management as well as review the practical action items where the information are
taken from case study of Deloitte for reinventing own performance management. Performance

4NEW TRENDS IN GLOBAL BUSINESS ENVIRONMENT
appraisals are perhaps the most reviled standard practice in all of management (Spira and Page
2013).
Research Questions
1. What made Deloitte think that their current approach is not working well?
2. Why it is necessary for Deloitte to reinvent performance management in their business
operations?
3. Differentiate between old versus new approach to performance management?
4. What are the suggestions to reinvent performance management?
Literature Review
Inefficiency of current approach (360-degree feedback) by Deloitte
As rightly put forward by Cappelli and Tavis (2016), Deloitte recognizes that their
current approach to performance management (360-degree feedback) was wasting a shocking 2
million hours per year. In addition, using the old management tool in practice was not able to
engage employees and level of performance of employees were dropping. In order to solve the
problem, Deloitte set out ways for building something that is more nimble, real-time as well as
individualized. It is important to take a look at why Deloitte need to change before getting into
the new approach (Pulakos et al. 2015).
After getting the results, it is noted that most of them come as feedback from their own
high performing team members where they had the chance to make use of their strengths on
everyday basis (Buckingham and Goodall 2015). To solve this, Deloitte had come up with clear

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goal where it is clearly mentioned that the company should spend more time helping people to
enhance the strengths. After the company recognize the strength in performance of high
performers, it is now important to evaluate as far as possible. The best answer will come from
immediate team leader but it is important to know how the employees provided without
idiosyncratic effect can (Van Dooren, Bouckaert and Halligan 2015).
Reinvent performance management
30% of performance reviews end up decreasing employee performance.
58% of Executives are of the opinion that their current program does not result in
performance or engagement (Buckingham and Goodall 2015).
70% of companies are now reconsidering their performance strategy
2 to 3 employees with highest performance scores are not actually comes under highest
performers
6% of companies are of the opinion that performance reviews are worth their time (Van
Dooren, Bouckaert and Halligan 2015)
2% of HR Executives are of the opinion that yearly evaluations are useful
80% of workers are dissatisfied with their performance reviews (Buckingham and
Goodall 2015)
According Gerrish (2016), before deciding upon the condition on how to deal with biased
assessments, it is important to look at the insight of Deloitte. The company had used the Gallup
1.4 million employee studies to look at the similarities between high as well as low performing
teams. To that, the high performing team feels that they are doing their best. Deloitte went from
there and identified 60 high performing teams based on certain criteria. To that, they conducted

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six-item survey for defining the similarities between the high performing teams (Orlando and
Bank 2016).
The goal was set once a year as well as reviewed at the same time. The problem with the
approach is that the annual goals are too much batched for a real time world as well as lot of time
goes waste on performance ratings (Buckingham and Goodall 2015). In addition, the
management can think of spending time to talk with people about their performance and careers.
The next discovery was that skills of someone is subjective and reveals more about the rater than
the ratee and this is known as idiosyncratic rater effect. It was then argued that best feedback can
only come from immediate team leader and problem is how deal with idiosyncratic rater effects
(Cardy and Munjal 2016).
Figure: Performance problems at Deloitte

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(Source: Levy et al. 2017)
It is difficult to find the business that is not concerned with the performance of their
employees (Buckingham and Goodall 2015). Despite the critical nature of employee
performance, it is noted that performance review has come under intense scrutiny in current year
where business enterprise are questioning the need for formal performance evaluation process. In
addition, the root cause of uncertainty is the fact where everyone involved seems to dread in
action and management is not convinced that the process drives future performance
improvements. In the present study, the most interesting article named as “Reinventing
performance management” as published in the Harvard Business Review (Buckingham and
Goodall 2015).
This article mainly begins with the compelling critique of the current batch style review
process where the company asks manager for evaluating their performance of employees based
in slate of performance criteria (Buckingham and Goodall 2015). It is noted that the most
concerned finding was present where more than 60% of the variance in ratings between
managers is the result of individual rater peculiarities of perception. It is therefore difficult to
compare the ratings of one rater to those of others. It is important to point out that the main
desire is to identify, investing and promoting the best activities. Rather than advocating for the
elimination of performance, it is important to lay out an alternative way to think about
performance management that can fit nicely in the process (Kinley and Kinley 2016).
Suggestions to reinvent performance management
It is important to consider the factor from the case study on Deloitte. The factor is
frequency where the company points out that the optimal performance of these new performance

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reviews should be on weekly basis (Buckingham and Goodall 2015). It is even suggested that the
best way to ensure frequency is to have regular check-ins about the near time work that had been
initiated by the team members. The performance of Deloitte is also getting impact from a
consumer technology platform that had been designed to be simple and quick. To that, people
tend to be interested in their own insights as well as achievements where they believe that
employing these methods will engage an employee around their own performance in a way that
had not been performed earlier (Bititci, Cocca and Ates 2016).
Theme 1: Crisis of credibility
It is time to blow up Human resources and build something new
HR faces a crisis of credibility in the boardroom
HR is the favorite corporate punching bag
Theme 2: Performance review leads to:
40%- Higher Employee Engagement
25%- Lower Turnover
18%- Growth in customer loyalty
15%- Boost to Productivity

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Theme 3: Motivating Employees
42% of companies want feedback every week
Stack ranking Providing frequent feedback
Annual review cycles Skill enhancement
Encouraging ownership thinking
Theme 4: Modern pay for performance
Paying for results
Creative about both performance and pay (Mihalcea 2017)
Performance management aligns to business goals as well as cycles
Companies link performance with pay
50.1% Based on increased performance
61.8% Provide individual incentives
25.7% Provide team incentives
Linking pay to performance
Performance-based rewards and recognition (Dimon 2013)
Culture and perks that reward high performers (Van Dooren, Bouckaert and Halligan
2015)
Higher increases for top performers
Results based incentive plan (Buckingham and Goodall 2015)

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Sources of secondary data
A source of secondary data for the field of research is the journal, “Reinventing Performance
Management”. This article is published in Harvard Business Review (Buckingham and Goodall
2015). The resources are available as secondary data that will be sued for analyzing what
research has been done that concerns the mentioned topic and research gaps that is yet to be
covered. Pro-Quest databases provides a single source for scholarly journals, newspapers, reports
as well as working papers and datasets that is present with millions of pages of digitalized
historical primary sources (Ates et al. 2013). There are two types of data that need to be
evaluated by the researcher such as inclusive data and exclusive data. Exclusive data are those
data where sources are taken before 2012. Inclusive data are those data where sources are taken
after 2012. In this study, the main source is taken from Harvard Business Review that was
published in the year 2017 and title is “Reinventing Performance Management- A case study of
Deloitte”.
Conclusion
At the end of the study, it is concluded that Deloitte is an audit firm where they engages in
providing professional services to their clients. Here, the company is of the opinion that
traditional approach (360-degree reviews) was inefficient as well as do not give a transparent
view of the current working situation and it is now important to reinvent the performance
management process. In addition, the best way to do this is by asking the team leaders for
assessing their team members through statements that mainly describes what they would do and

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what they think. In addition, employee performance snapshots should be regular that is preferred
on weekly basis and the technology designed should be simple, quick and engaging at the same
time.

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Reference List
Ates, A., Garengo, P., Cocca, P. and Bititci, U., 2013. The development of SME managerial
practice for effective performance management. Journal of Small Business and Enterprise
Development, 20(1), pp.28-54.
Bititci, U., Cocca, P. and Ates, A., 2016. Impact of visual performance management systems on
the performance management practices of organisations. International Journal of Production
Research, 54(6), pp.1571-1593.
Buckingham, M. and Goodall, A., 2015. Reinventing performance management. Harvard
Business Review, 93(4), pp.40-50.
Cappelli, P. and Tavis, A., 2016. The performance management revolution. Harvard Business
Review, 94(10), pp.58-67.
Cardy, R.L. and Munjal, D., 2016. Beyond Performance Ratings: The Long Road to Effective
Performance Management. Industrial and Organizational Psychology, 9(2), pp.322-328.
Dimon, R., 2013. Enterprise Performance Management Done Right: an operating system for
your organization. John Wiley & Sons.
Gerrish, E., 2016. The Impact of Performance Management on Performance in Public
Organizations: A Meta‐Analysis. Public administration review, 76(1), pp.48-66.
Kinley, N. and Kinley, N., 2016. The end of performance management: sorting the facts from the
hype. Strategic HR Review, 15(2), pp.90-94.

13NEW TRENDS IN GLOBAL BUSINESS ENVIRONMENT
Levy, P.E., Tseng, S.T., Rosen, C.C. and Lueke, S.B., 2017. Performance Management: A
Marriage between Practice and Science–Just Say “I do”. In Research in Personnel and Human
Resources Management (pp. 155-213). Emerald Publishing Limited.
Mihalcea, A. D. 2017. Employer Branding and Talent Management in the Digital
Age. Management Dynamics in the Knowledge Economy, 5(2), 289-306.
Orlando, J. and Bank, E., 2016. Case Study: A New Approach to Performance Management at
Deloitte. People and Strategy, 39(2), p.42.
Pulakos, E.D., Hanson, R.M., Arad, S. and Moye, N., 2015. Performance management can be
fixed: An on-the-job experiential learning approach for complex behavior change. Industrial and
Organizational Psychology, 8(1), pp.51-76.
Spira, L.F. and Page, M., 2013. Risk management: The reinvention of internal control and the
changing role of internal audit. Accounting, Auditing & Accountability Journal, 16(4), pp.640-
661.
Van Dooren, W., Bouckaert, G. and Halligan, J., 2015. Performance management in the public
sector. Routledge.