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World - North America ahead of Europe in performance management

01 September 2011

Lumesse, the provider of talent management solutions, (previously StepStone Solutions) has announced the results of its Performance Management Assessment Tool, which reveal companies in the US and Canada as overall global leaders in employee performance management.

Based on assessments by 500 business and HR executives in 44 countries worldwide, the results, highlight the contrasts between North America, Europe and Asia Pacific when it comes to the maturity of employee performance management processes.

North American companies came out on top at every basic performance management practice, other regions had much more variable results. In the UK, for example, 37% of organisations had cascading goals for the majority of employees, the second highest of all regions, but the UK proved to be the least effective at providing financial metrics. Meanwhile, Germany, France, Italy, Benelux and Scandinavia were above the global average (32%) in terms of providing career goals and linking these to financial metrics (19%), but still struggled to make a connection between pay and performance, all falling below the global average (24%).

The Asia Pacific region also had different strengths and weaknesses. It was the second best region at enabling its employees to see a connection between performance and compensation. But only 22% of its organisations provide cascading goals for the majority of employees, and just 17% measure the majority of its managers on leadership effectiveness, proving to be the weakest region on both measures.

Matthew Parker, CEO, Lumesse, commented "wherever we look we see the best organisations enhancing performance management processes to develop the talent that will be needed for growth and competition, because only people can create great performance. But these results show that, while there are global hotspots of good practice, there is still plenty of untapped opportunity for substantial business improvement by focusing on the areas which deliver the most benefit."

The global data showed, for example, that the best companies were setting their employees cascading goals so they could understand how their work supports the company objective. Almost half (47%) of the best have cascading goals for most or all employees and more than a third (35%) retained more than 90% of their high performers and high potential employees over the past five years.

The best companies were also more likely to hold their managers accountable for leadership effectiveness, with nearly half (42%) confirming they measure most or all managers' leadership ability. However, while leaders fare well in connecting pay and performance, 40% say most or all of employees are able to see a clear relationship between performance and compensation, only 28% of leaders have financial metrics in place to create employee goals.

To read the worldwide assessment results please click here
 

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