BUS FPX 3040 Assessment 2 Performance Management and Training BUS-FPX3040 Fundamentals of Human Resource Management

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Introduction

General Electric (GE) epitomized the American corporate landscape throughout the 20th century, significantly contributing to the nation’s technological and economic advancements. However, alongside its notable successes, GE encountered significant failures, particularly in its performance management system during the late 20th century. Today, GE is once again at the forefront of innovation, striving to create a more equitable, humane, and effective performance management framework.

From EMS to PD@GE

For a period spanning from 1976 to 2016, GE implemented its proprietary performance management system known as the Employee Management System (EMS). Under the leadership of CEO Jack Welch, who served from 1981 to 2001, the EMS introduced the ‘vitality curve,’ a method of ranking employees that fostered a competitive and often demoralizing workplace atmosphere. While Welch’s tenure was marked by success, increasing criticism arose regarding the detrimental impact of this ranking system on employee morale and overall company performance. In time, many organizations, inspired by GE’s approach, adopted similar performance management systems. However, GE, along with others, has shifted towards more personalized and effective performance management strategies, illustrated by the introduction of the PD@GE system in 2015.

But Is It Effective?

A study conducted by Narasimhan, Jordan, and Huang (2018) underscores GE’s acknowledgment of the inadequacies within its previous system, leading to the evolution of PD@GE. Early feedback from employees indicates a favorable reception, highlighting a focus on immediate feedback and increased individual autonomy. This transformation aligns with a broader movement within corporate America that emphasizes collective team performance over individual assessments.

Formal vs. Informal Feedback

In contrast to EMS’s reliance on formal, periodic evaluations, PD@GE emphasizes informal, continuous feedback. Research indicates that solely depending on formal evaluations may not effectively enhance performance, underscoring the critical role of regular, personalized feedback in fostering employee growth.

Best Practices to Improve Employee Performance

Dorsey and Mueller-Hanson (2017) identified five fundamental causes of performance management failures and suggested best practices to rectify these issues. Their recommendations include simplifying performance systems, allowing flexible goal-setting, focusing on performance measurement, providing coaching, and applying varied criteria for different decisions.

Importance of Training and Protection from Litigation

Comprehensive training programs are essential for equipping employees for their roles while also safeguarding organizations from potential legal liabilities. Different training modalities, including classroom instruction, material aids, and web-based training, can be utilized to ensure effective onboarding and ongoing employee development.

Conclusion

The shift from EMS to PD@GE at GE signifies a broader transformation in performance management, prioritizing personalized feedback, employee development, and team success. By addressing the shortcomings of traditional performance management systems and embracing innovative approaches, organizations can foster a more engaged and productive workforce, well-equipped for success in the 21st century.