5 Trends that Will Drive Employee Engagement in 2016
It’s that time of the year again: the time to look back at the year that ended; the time to predict where the next year is going. This thought exercise is especially fascinating as I write these words, since 2015 was a heck of a year for HR technology, and employee gamification specifically. I believe this rapid evolution will continue in 2016, mightily impacting organizational culture, HR and gamification. My main point is that we are moving away from SUBJECTIVE EVALUATION of employees to OBJECTIVE AND PROACTIVE DEVELOPMENT OF EMPLOYEES.
Here are 5 key HR trends in 2015 that prove this, and my guess-estimates at to where these are taking us in 2016:
1.The death of the performance review
During 2015 both Deloitte and Accenture announced they will be doing away with the performance review. A story that ran in the Harvard Business Review discussed this too. What was once the gold standard for HR management and evaluation – rating all employees on a bell curve once a year and adjusting their salaries, status and future – suddenly became an incredible waste of time.
Why? To put it plainly, performance reviews consume too much time and resources and provide too little value. Performance reviews are important, of course, but maybe not as a once-a-year process that refers to targets that were set too long ago (i.e. last year). Additionally, some organizations felt the need to depart from the rank-and-yank culture – it was cited as a source of stress. Employees perceive ranking as threatening and not as a positive process.
Most importantly, perhaps, is the fact that performance reviews are focused on the past. What if the same energies were directed at future performance? What if future performance could be directed based on realistic short term goals? What if employee evaluation (=the performance review) was replaced by employee development (=real-time tracking and coaching, relative to clear short-term objectives and goals)?
As a side note, an additional issue with performance reviews is that despite their creation through a lengthy structured and documented process, the results end up highly subjective. Researchers concluded that “most of what is being measured by the ratings is the unique rating tendencies of the rater. Thus ratings reveal more about the rater than they do about the ratee.”
2. 2015 was the year of the OKR
OKR stands for “Objectives and Key Results”. It is a way to define and track objectives in the workplace, and was pioneered at Intel, and is used today by Google, Linkedin, Twitter and others.
In 2015, OKRs became all the rage as a management method, with articles titled “This is the internal grading system Google uses for its employees – and you should use it too”. In general, Objectives are ambitious, while Key Results are what make the objective achievable, quantifiable and objectively gradeable. Many systems have various degrees of transparency, where employees can see each other’s objectives and key results, aligning employees with corporate objectives too. More interestingly, the world of OKR was productized by companies like BetterWorks, which strive to make goals open, transparent and aligned. In many ways these methods mean that the death of the performance review is replaced by a system which shows employees where they and others are in real-time, defining work goals objectively and tracking their achievement in a fair and transparent way. All this isn’t for some idealistic view of transparency or fairness – it’s to make work better for employees and for the company. Focusing on shorter-term OKRs also make the evaluation of work more development-oriented and future focused, rather than being evaluation-centric.
3. The Internet of Things is Moving into the Workplace
The Internet of Things isn’t only about your refrigerator being empty or full, or predicting your food cravings. The Internet of Things – as a concept – is also about knowing what people do by tracking their work badges, smartphones and more. For today’s workforce, the most relevant metaphor is thinking of tracking their performance at work as an activity tracker at work. Again, similarly to the OKR approach described below, tracking in real time provides real time feedback to the employee about how they are doing and can be a strong motivator, encouraging employees to reflect on their work performance.
4. The geeks have arrived: people analytics
This subtitle is based on Josh Bersin’s article. Its main point is that HR is increasingly reliant on analytics to understand workforce performance. Bersin says that the fuzzy HR department is changing, with analytics and data science, and that businesses are getting serious about it. After years of theoretically discussing the application of hard analytics to HR, businesses are actually beginning to do it. Yet this isn’t Taylorism alone, since tracking employee performance or predicting it is again not about evaluation but rather about development, by focusing on how employees can improve their performance.
5. The largest generation in the workforce is millennials
In 2015, Millennials have become the largest generation in the workforce, and by 2020 they will form 50% of the global workforce. So what does the emergence of Millennials in the workforce mean? It doesn’t mean that we need video games at work. In fact, using lame video games at work can even backfire, with gamers disappointed by the lower quality of the game. But what Millennials do mean is that the needs of a generation that expects transparency and is more digital than any generation that preceded it should be taken into account in terms of workplace design and culture.
Millennials are generally considered to be less comfortable with rigid corporate hierarchies. They expect information to be widely shared, and not kept in silos. They expect to rapidly go up the ranks at work, and get constant feedback. In other words, they are looking for a culture and workstyle that is different than the worlds that baby boomers and gen x feel comfortable in. Yet, all these characteristics can be addressed by employers. The transparency inherent in the IoT in the workplace, or the OKR method can work well for them, as well as the feeling that their boss sees they are doing well and commends them for it. If getting tracked or measured at work helps them get better, see what their goals are and results in social and managerial recognition, together with clear communication of corporate goals, they can love that.
In this respect, for Millennials feedback is a killer app. For a generation that may prefer digital communication to a face to face conversation, getting that feedback digitally – through gamification, recognition, OKR systems – may be just what they need.
Gamification in 2016?
What does all of the above mean for gamification? Enterprise gamification was all hype in 2012, but the practice of using game elements to engage employees seems to be coming of age in 2015 and in 2016. We’ve seen a lot of interest in gamification in the past year, from companies looking to drive performance and motivation to others recognizing the strength of gamification when it comes to e-learning and onboarding. The understanding of gamification has become deeper, with books like Jane McGonigal’s SuperBetter, and an industry reflecting about the meaning behind Gartner’s 2012 prediction that 80% of gamification projects will fail.
Enterprise gamification can drive the communication of corporate goals and objectives, show objectives and key results to employees, track performance in real time and coach it. Feedback is the killer app for Millennials, but it also does wonders for other generations in the workforce. Using gamification like an activity tracker for work may well be the defining factor of workforce software in 2016.