There seems to be as many differing opinions about what comprises an effective employee performance management program as there are varieties of methods to evaluate employee performance. I keep tabs on the EPM and Talent Management marketplace to see who is doing what and which trends are taking hold. The purpose of this marketplace vigilance is to gather information and formulate recommendations for our ongoing product development that ensures HRN Management Group’s EPM solution, Performance Pro, remains a top performing (and selling) solution in the SMB marketplace. Just three years ago there were approximately four direct performance management competitors I kept on my radar. Today, there is a dizzying array of new vendors and products entering the market.  A common question I hear from our sales department is, “It’s between Performance Pro and [insert previously unheard of new competitor name here]. What do we know about their solution?” Of those original four, two (Mindsolve and KnowledgePoint) have been acquired by other companies to provide a singular performance management component of a larger ‘Talent Management’ solution. The other two (Halogen and SuccessFactors) have invested heavily in development and marketing to deliver a comprehensive and integrated ‘suite’ of solutions.

The market has spoken and it wants fewer, more comprehensive, integrated talent management functions that blend performance evaluations with employee development, succession planning, compensation management, and administrative reporting/analysis. During this transition the term Employee Performance Management became the broader, all inclusive Talent Management.

In addition to competitive analysis and real-time customer feedback to provide Performance Pro development input, I also read industry reports and analyst data. In 2006 DDI and The Conference Board co-sponsored a talent management survey authored by Richard Wellins, Ph.D. and  Keith Caver (www.ddiworld.com/pdf/ddi_2006talentmanagementstrategiesconference_es.pdf) that I found quite interesting.

The survey concluded that despite the majority of respondents having implemented the essential ingredients required for successful talent management, the state of their talent management programs is in disarray. This is because of three primary reasons.

1. Programs have not been properly rolled out, implemented, and integrated.
2. Top executives are not viewed as committed to talent management as a priority.
3. Gathered data is not utilized and analyzed to effect positive changes in the organization.

In 4 out of 6 areas measured, the usage rates of ‘in-place, bought-and-paid-for talent management solutions' was less than a year ago. Companies made the initial investment and have the systems in place, they just aren’t using them. Why? Because they are not integrated, are difficult to use, and senior leaders don’t buy into “talent management” as a priority. Below are some other key findings from the survey:

• Overall satisfaction with implemented talent management components is low across the board, with all components well under the 50% satisfaction level.
• Just over 40% are satisfied in executive and employee development tools and programs.
• Only 18% are satisfied with their succession planning criteria and process which leads to . . .
• Merely 15% being satisfied with their approach to early identification of leadership potential.
• They need help. Across the board about half of companies plan to seek outside help and expertise to get their programs on track. This demonstrates an acknowledgement of insufficient internal resources and expertise. A high value is placed on an outside perspective and recommendations.
• Nearly one-third of respondents found senior company executives weak in terms of functioning as a cohesive team.
• Developing a variety of effective executive leadership training and development programs, and not relying exclusively upon university programs is essential.

For a talent management system to be successful it requires leaders who understand the importance of functioning as a cohesive team and developing the future leaders of the organization. Secondly the systems and tools used cannot simply perform a single function but must be integrated to share and analyze data.