In my previous blog post, I covered what a performance management system is, what characteristics you should look for in a tool, and why you should consider building it instead of buying it. In this second part, I'll explore a modern performance management system example. But not just any example, the PMS we built and some lessons we learned.
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Table of contents:
- Why We Decided to Build Our Performance Management System
- Defining a New Performance Management Model
- The Right Performance Management System to Keep Us on the Right Track
Why We Decided to Build Our Performance Management System
Have you ever been to an orchestra concert? This is how it goes: the maestro hits the baton, the woodwind flutes start the melody, followed by the tuba, then the percussion, and finally, the strings bring the whole concert to life. All in perfect harmony. It’s quite the experience. But behind that one or two hours of pure enjoyment for your ears, there are weeks, months, and years of intense practice, collaboration, and alignment.
At OutSystems, we had the dream of working precisely like that. Not that we didn’t do it before— we’re market leaders for a reason. But, as the company continued to grow, rapidly adding business dimensions, customers, partners, office space, and even offices worldwide with different languages and cultures, we felt we needed an upgrade. With all this diversity, it was time to change the way we operate to a global, distributed but unified OutSystems team. It was the perfect time to design a new performance model so we could clear any hurdles and outperform ourselves.
There. We already had the name.
We also knew we wanted to build the system ourselves because, although there are plenty of performance management systems out there, we wanted a solution that adequately reflected the seven principles of our company culture (if you’re still in the process of finding the perfect performance management system for your organization make sure you read my previous article first). And as the vendor of a leading low-code platform, we know we had the right technology to do it.
All that was left was the methodology.
Defining a New Performance Management Model
We created OutPerform as a program that should guide every OutSystems employee in the right direction to ensure our customers and company’s success.
This performance management model is a quarterly journey supported by three pillars: goals and alignment, feedback, and recognition.
Let me use an example to better explain how our program works: imagine that your family is growing and you need to move out from that lovely one-bedroom apartment where you’ve been living to a better and bigger house.
1. Goals and Alignment
The first step in any house hunt is defining what kind of house you need. You want four bedrooms, two bathrooms, and a beach view. The OutPerform journey began exactly the same way, by defining what we, as a company, need. In other words, the objectives for the quarter. For this pillar, we adopted the Objectives and Key Results (OKRs) methodology.
Every quarter, the senior management team meets and defines the objectives for the upcoming three months. Then the teams gather to define goals aligned with the company’s direction. These are cross-functional goals where people from different departments collaborate toward the same outcome. And what's distinctive about this new way of setting and aligning goals is that we focus on the outcomes, and departments work together to make them happen.
Another exciting aspect of this new model is that all OKRs are available for consultation on an online platform, and anyone in the company can search and understand the “why” and the “what” of any project that any collaborator or any team is working on.
This level of transparency is very important. We need to ensure that we're all unified and break traditional cross-departmental silos. In addition, having access to my colleagues' objectives also enables collaboration, as it becomes easier for people to understand what others are doing and to generate productive conversations and plans around projects.
After visiting a few houses based on your criteria, you might realize that maybe you don’t need a view of the beach and that maybe two bedrooms are more than enough. That’s what our second pillar is, too. It’s about reflecting on what we can change or improve to accelerate our defined outcomes.
During an entire quarter, managers are encouraged to have weekly one-on-ones with their team members to acknowledge what has been done right and what could be done to improve in order to accelerate success. Communication is critical for ensuring every collaborator is on the right path or if there’s space for improvement.
After a long search, you finally find your dream house. Now it’s time to celebrate and open the champagne. That’s the recognition pillar.
At the end of each quarter, and after those recurring one-on-ones, the manager and team members celebrate the great accomplishments of the quarter and prepare for a brand new one. Let’s be honest: even if you love your job, there are always days you’d prefer to stay in bed, especially on wintry, rainy days. So, if you add some fun and celebration to it, everything gets more exciting.
These three pillars are connected; one wouldn’t work without the other. Establishing objectives at the beginning of every quarter ensures the cross-departmental alignment, transparency, and collaboration we need to support our customers’ success. On the other hand, open communication with a manager based on frequent feedback and moments of celebration are the glue that holds everything together and makes sure those goals are fulfilled.
The Right Performance Management System to Keep Us on the Right Track
In a competitive and complex market like the low-code one, OutPerform helps us to be agile and faster. Every quarter we redefine our goals as a company supported by every team no matter the department or seniority level.
This program has been running in the company for over three years, but we look at it permanently to see where opportunities for fine-tuning arise. Now everyone in the company knows what success looks like every quarter. They have the freedom and support to make their own decisions, make mistakes, and learn from them. We’re only human, after all. That propels an environment of creativity and innovation that makes us a leader in the low-code market, delivering speed and value to our customers daily.
That’s how we all play in perfect harmony: engineering, customer success, digital, sales, marketing, people, and finance. And that’s incredibly powerful.
And if just like us, your organization wants internal processes like performance management to be a unique reflection of your company culture, or if your HR department is challenging your IT organization to ensure teams are fully performant regardless of their workforce setting, or if you simply want to break free from the restraints of a standardized, off-the-shelf tool, I invite you to learn more about about the OutSystems high-performance low-code platform.
Visit our Performance Management System page to learn how you, too, can build your own system, fully customized to your organization’s culture.