Human Resources Bristol-Myers Squibb: Appraisal Forms and
Rating
Bristol-Myers Squibb (BMS) is one of the world’s largest
pharmaceutical firms and is widely known for its innovative research. But the
firm has not limited its innovations to products. Several years ago, BMS
leaders decided that the company’s performance management system needed to be
re-invented. Specifically, they determined that the existing performance
appraisal process was not working.
Managers were ‘form focused’, meaning that they were so
concentrated on filling out the performance review forms, the content of the
forms was not being used for employee coaching and based on development. Also,
most of the attention of managers and employees was historical and based on
what employees had done in the past. Little attention was being given to how
employees could develop and improve in the future. The most radical steps taken
were to totally eliminate the appraisal forms and their rating scales and to
request that managers not discuss pay increases during performance review
ses-sions.
Instead, a new ‘performance partnership’ became the focus.
At all levels of BMS, managers were trained to hold regular meetings with their
employees. At these meetings managers and employees review performance goals
expectations. Together they set expectations and timelines for accomplishing
the goals. Rather than meeting just once a year, the performance partnership
update occurs throughout the year.
The changes in the performance management system have led to
several positive results. First, employees are more active participants, rather
than just getting their ratings on forms and then passively listening to the
managers. Also, a greater amount of time is spent on coaching because managers
were trained on use of a guided feedback approach. This approach has led to
more discussions in which employees and managers emphasize joint problem
solving and goal achievements. Although the system takes more managerial and
employee time, the coaching and employee involvement have created a more
positive relationship and improved individual and managerial performance.
1. Discuss how this case illustrates the conflict between
the administrative use and developmental use of appraisals.
2. What would be some of the advantages and disadvantages of
eliminating the use of appraisal forms and ratings?
