June 17, 2013 Implementing Performance Management In Turbulent Times Marc H. Fogel, M.S. Principal, Organization Development American Airlines
Agenda 1. Introduction 2. Performance Management Overview 3. Performance Management @ American Airlines 4. Everything Changes 5. Managing the Change 6. Calibration and Talent Reviews 7. Close and Q&A American Airlines June, 2013 2
Performance Management: What ? Why? How? What • A cyclical process that guides members of the organization to be more thoughtful and intentional regarding their contributions to the organization Why (To What End?) • To support the organizations ability to consistently, and repeatedly achieve or exceed its stated goals How • Setting clear expectations and standards of performance (what needs to be accomplished) and behaviors (how it needs to be accomplished) • Aligning individual contributions with departmental and organizational goals • Supporting individual’s ability to reach and expand their potential American Airlines June, 2013 3
The Performance Management Cycle American Airlines June, 2013 4
AA Traditional Performance Management Timeline Manager Evaluations ( previous year ) Self-Evaluations ( previous year ) Calibration ( previous year ) and Talent Review ( current/approaching year ) Sessions Objective Setting ( approaching year ) Performance Discussions ( previous year ) Development Discussions ( current/approaching year ) Informal Mid-year Discussions ( current year ) American Airlines June, 2013 5
Performance Evaluation @ AA: Pre-2012 Development of Self & Others People-Related Competencies Corp Communication 33% Objectives Leading Self & Others People-Related Competencies Teamwork and Collaboration Dept. Objectives Valuing Diversity Overall 33% Individual Performance Meeting Objectives Score Objectives Safety & Compliance Business-Related Competencies Championing Change Customer Focus 33% Driving for Results Business-Related Competencies Making Sound Decisions Innovations American Airlines June, 2013 7
Everything Changes… New CEO Management restructuring (Project Cascade) In the midst of redesigning leadership competencies Nov, 2011 AA Files for Chap.11 Bankruptcy Protection American Airlines June, 2013 8
Managing the Change • PM design team was very clear on why the change was necessary • “Shopped” the proposed system around with key leaders early in the design process • Instituted new rating categories American Airlines June, 2013 10
Change of Rating Scale Previous Rating Scale 1 1.5 2 2.5 3 3.5 4 4.5 5 Needs Needs improvement significant or Frequently Consistently Consistent improvement additional exceeds exceeds with peers relative to experience peers peers peers relative to peers Rating Categories for Assessing 2012 Performance Capable Strong Exceptional Low Performer Performer Performer Performer Unsatisfactory Steady Performance Consistent, Exceptional Performance, Successful Contribution & High - or – Poor Contribution & Impact Impact Learning/Developing Results/Behaviors American Airlines June, 2013 1
Managing the Change • PM design team was very clear on why the change was necessary • “Shopped” the proposed system around with key leaders early in the design process • Instituted new rating categories • Worked very closely with the system administrator to ensure the system could do what we needed it to do American Airlines June, 2013 12
2012 Evaluation Requirements Section 1 2012 Performance Assessments • Description of 2012 key accomplishments • Rating using 1 of 4 performance categories Section 2 2013 Key Focus Areas • 3-5 focus areas for 2013 • Describe what success looks like for each focus area Section 3 2013 Feedback & Development • Strengths and areas for development American Airlines June, 2013 13
Managing the Change • PM design team was very clear on why the change was necessary • “Shopped” the proposed system around with key leaders early in the design process • Instituted new rating categories • Worked very closely with the system administrator to ensure the system could do what we needed it to do • Used a “just-in-time” philosophy to educate/inform managers • Conducted webinars to discuss the new approach • Made available a “managers’ toolkit” to all managers American Airlines June, 2013 14
Table of Contents Page • Introduction………..…………………………………………………………………...3 • 2011 Performance Ratings……………………….......................…………………. 4 • 2012 Assessment Overview and Timeline.………………………......................... 5 • 2012 Revised Performance Rating Criteria and Distribution Guideposts…….…6 • 2012 Assessment Form Overview………………………….................................. 7 • Planning & Performance Discussion……………………………………..………. 8 Appendices………………………………………………………………………...... 9-25 American Airlines June, 2013 15
Introduction 2012 was a transitional year from many perspectives; performance management being one of them. Based on feedback from managers, we’ve adopted a simpler performance assessment process this year. In 2013, our focus as a company will be on three main goals: 1. Running a great airline for our customers 2. Successfully completing our restructuring 3. Planning and preparing for the merger with US Airways • How am I doing? • What should I be doing? This year, help your people perform to the best of their • What are my strengths? ability by providing team members with information Areas I can improve? and feedback regarding these questions: • How have they performed in 2012? • What should they focus on in 2013? • What are their strengths and areas for improvement? American Airlines June, 2013 16
2012 Revised Performance Rating Criteria 1 Managers choose which of the definitions below best describe team member’s overall performance. There is only one whole rating – no “in-betweens”. Exceptional Low Performer Capable Performer Strong Performer Performer Steady Performance Unsatisfactory Performance, Consistent, Successful Exceptional Contribution & - or – Contribution & Impact High Impact Poor Results/Behaviors Learning/Developing Team member either: Exhibits results & Team member exhibits Team member exhibits Team member exhibits behaviors that meet some, performance that is results & behaviors that results & behaviors that but not all expectations 2 unacceptable; does not consistently meet and consistently exceed -or- sometimes exceed meet minimum expectations, and are often expectations expectations 2 Is new to their role, having unique and extraordinary insufficient time to gain expertise or make an impact 1 See additional details in Appendix; 2 Assumes team member has been in position for a sufficient amount of time American Airlines June, 2013 17
Appendices APPENDIX 1: Performance Management Supporting Documents 2012/13 Performance Assessment Flow Chart….………………………………………….… 11 2012 Performance Assessment Detailed Criteria………….………...……………………….. 12 2012 Self-Assessment…………………………………………………………………………… 13 2012 Assessment - Manager View…………………………….............................................. 14 Talent Review Fields….…………………………………………………..……………………… 15 Completing the “2012 Accomplishments” Section …………………………………………… 16 Completing the “2013 Key Focus Areas” Section ……………………………………………. 17 Completing the “Feedback & Development” Section ………………………………………… 18 Suggested Planning & Performance Discussion Process………………………………….... 19 Role Mandate Form - Sample……….…………………………………………….….……….... 20 APPENDIX 2: Manager Tools Sample FSU Development Offerings…………………………………………….…………… 22 Active Listening Tips: Are You a Good Listener? …………………………………………… 23 Addressing Performance Barriers………………………………………………………………. 24 Rating Biases & Personal Perceptions to Avoid……………………………………………… 25 American Airlines June, 2013 19
Appendix 1: Supporting Documents
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