Christina Yue, Customer Learning Manager |

Chances are you’ve never heard the word “simple” used to describe performance management.

In 2014, Fannie Mae employees Elizabeth Lanford and Gala Meyerovich set out to transform their cumbersome system into a simple, user-friendly process. They began by outlining their challenge, analysis, solution and results.

Challenge: An overly complicated, cumbersome system currently in place.

Analysis: What truly matters at the core of performance management?

Solution: Improve process and technology to focus on what matters.

Results: Managers can focus on coaching and providing feedback.

As Lanford and Meyerovich envisioned a brighter future for performance management, they hit a roadblock; they couldn’t find any product tailored to fit their specific needs. Determined to move forward, they piloted their own system with the leadership team from Fannie Mae. The proposed system included a 1-3 rating system (below expectations, meets expectations, exceeds expectations) and two rating structures (results to goals, behaviors). Ratings were plotted on a nine-box grid.

The pilot seemed to end in success with positive feedback about the structure and the ability to articulate issues in performance discussions. However, the following year (2015) Fannie Mae transitioned to Oracle HCM Cloud, rolled out the piloted performance management system, and implemented Fannie Mae Power Behaviors (FMPB). Overall feedback proved to be negative, and the HR department headed back to the drawing board.

The analysis process is explained below.

What They Did

• Conducted focus groups
• Collected feedback from leadership individually
• Sought advice from Oracle
• Researched best practices and benchmarks

What They Learned

• All of the changes at once were overwhelming
• Rating each individual behavior wasn’t useful
• Implementing multiple changes created a negative perception
• Features were not used on a daily basis
• Performance management became red tape and administration

With new feedback and a new year (2016), Lanford and Meyerovich made another attempt at a simple performance system. Keeping in mind that the core of performance management is the relationship between employee and manager, they changed goal setting, ongoing feedback and year-end requirements.

For goal setting, they eliminated 60 percent of the fields from before and upgraded to Oracle R10.

For ongoing feedback, they encouraged one-on-ones in a regular cadence, removed requirements for documentation and made mid-year reviews an exception instead of an expectation. Only off-track employees needed mid-year reviews.

For year-end processes, they eliminated 360s in the system, encouraged a holistic view of performance, enhanced reporting and upgraded to R11.

When collecting feedback through random sampling and focus groups, they heard the following:

• Goal setting was easier and more useful.
• Managers enjoyed the simplification of mid-year reviews.
• Managers felt more invested in relationships with employees.
• Real-time feedback occurred more often, allowing for timely improvements and corrections.

Today, the HR team refers to 2016 as their year of simplification. What once seemed like a dream is now a reality. For more details on the simplification of Fannie Mae’s performance management system, watch the full presentation here.

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