Here are some of our more recent findings from our work with leading corporations, medical centers and universities.
Employee Engagement Impacted By Bias in Performance Ratings
Bias in performance ratings has been well-established. For example, merely being part of the hiring process influences a manager to give an employee a hire rating.
Recently CFR Advisory studied the performance of 400 middle managers. Each had been assessed using a 5-point rating scale with 1 being the highest. Based on objective performance ratings 6% of those managers who should have received a rating of 1 were systematically pushed down into the “2” category. Simultaneously 6% of those who objectively were rated a “3” were pushed up to the “2” category. Importantly, managers were aware of what their performance rating should have been.
These biases have a significant impact on business performance. Those pushed down from 1 to 2 ratings have a high probability of near-term defection. Adding to the flight of talent quality. Those pushed up from a 3 to 2 rating feel like they have been given a free pass. Not to mention the fact the ratings have added to the company generated paper trail that can be used to support claims of improper termination.
What Drives Success Varies By Role
CFR Advisory has found that the predictors of performance vary by role. This was found by comparing predictive models across roles including people managers, sales people, researchers, and product groups.
This is important because many talent assessments – particularly management and leadership – don’t account for differences in role. For instance, one of the most popular executive assessments is heavily based on the profiles of convenience store managers.
95% Success Rate When Selecting Your C-Suite Based On Resilience
Based on over 200+ selections of corporate leaders CFR Advisory has proven the value of incorporating the assessment of candidate resilience into the assessment process. The success rate for those selected based on an assessment of their resilience is 95%.
The CFR process is built off the behavioral interview framework with two important differences. First, the interview is conducted after an initial screening by HR or a search firm. The CEO and other senior executives don’t meet a candidate until they have been found to match the company’s specific resilience profile. This avoids the problem of bias by giving the CEO an objective profile to test their perceptions again.
Second, traditional behavioral interviews focus on the skills and accomplishments of the candidate. They don’t evaluate the candidate’s “will”. Assessing resilience across 10 dimensions provides a deep understanding of the will or drive the candidate will bring to the new role and/or company.
Your Best & Brightest May Be Burned Out
30% of your employees are burned out according to the latest research from the Mayo Clinic. Unless you are in a high stress field where it can sky rocket to 63%. What does that mean? That up to two-thirds of your people are emotionally exhausted, treat clients and colleagues with cynicism and feel like their work is meaningless.
The good news is that if you focus on hiring for and developing people’s resilience you reverse the growing epidemic of burn out and build a workforce that will lead sustained, profitable growth. One major bank has been successful in reducing burnout by one-third.
Your Expertise Can Be Your Enemy
Nobel laureate Daniel Kahneman has spent a life time understanding the biases that lead to bad decisions. These biases are especially powerful when we are in a chaotic, fast-paced environment. For example, when we are under pressure our mind works to create coherent stories from mere scraps of data. Once such a story is created it drives decisions.
People high on two components of resilience – Fact-Based Decision-Making and Ability To Pivot are significantly more likely to collect more relevant information before making an important decision. This in turn can dramatically increase the odds that their decision is correct.
Higher Purpose Drives Higher Performance
In a recent study of middle managers and professionals, CFR Advisory found that engaging in a higher purpose was a key performance driver for 63% of the predictive models developed.
Importantly, engaging in a higher purpose was no more important a performance driver for millennial’s than it was for baby boomers.
This shows the importance of leaders consistently and concretely connecting the work of their people to a greater good.
Teams Lack The Ability To Solve Customer Problems
In a recent study conducted by CFR Advisory, members of management teams identified three areas inhibiting their ability to solve customer problems:
- Inability to innovate
- Bias against looking outside the team and the organization for new ideas
- Team members engage in vigorous, enthusiastic discussions when they meet – sharing and building ideas
- Team discussions characterized by apathy and a lack of openness
As the economy begins to heat up, these factors may limit competitiveness and growth. Teams that successfully close the gaps in these four area can expect to increase their financial performance by up to 20%.
Customer Centric Cultures Survive A Challenging Environment
Our most recent work shows that organizations with employees who have strong resilience and low rates of employee burn out also retain a very strong customer centric culture.
This makes sense given that highly resilient people are able to adapt to fast-changing opportunities without becoming emotionally exhausted or cynical towards those they serve. Importantly, they also retain their sense of personal accomplishment.