FAHR 2016: Coca-Cola shakes up its HR practices with an experiment in performance enablement

Author: Mark Townsend | Date: 27 Apr 2016

The beverage giant is trialling a system that combines HR policy with total reward practices

Coca-Cola says it is joining a growing number of organisations leaving behind process-driven HR practices in favour of performance enablement – a system that better aligns HR with strategy and business results.
 
Jia Gay, vice president for human resources, Middle East and North Africa, explained that the drinks giant’s ambition is to combine HR policy with total reward practices, an initiative she expects to eventually be rolled-out company-wide.
 
“Last year, we started an experiment in performance enablement that has four components. The first is reflecting; every month, managers will go through a time for reflection and take part in a survey that requires them to reflect on each person’s performance,” she told delegates at the Federal Authority for Government Human Resources Conference in Dubai.
 
“If you had to today, would you give this person the highest possible raise?” or “Is this person exhibiting the behaviours you would expect to see?” are indicative of the questions Gay said help focus managers’ thinking.
 
The second strand of performance enablement focuses on monthly team meetings, and the third deploys one-on-one “check-ins” between managers and their staff. Both are important barometers of performance.
 
The final component is point surveys: “Associates [employees] get an opportunity to give their manager feedback on how they are doing or how the process is working.” Gay said there are no mandatory aspects of performance enablement. “The experiment is really about giving everyone the opportunity to use these tools, but if they choose not to that is fine too – there are no formal ratings at the end of the year,” she said.
 
Even so, eliminating annual ratings demands a different way of calculating compensation. Compensation is decided by managers and delivered through their budgets, which Gay argued carries more flexibility. “One of the things we learned was that we were able to manage within the budget. We had greater differentiation, which is what you want in pay for performance versus what was previously a performance rating against target.”
 
Coca-Cola has also moved away from a traditional, leader-driven approach to communicating compensation, replacing it with a technology-led interactive game that enables employees to understand how their work contributes to the new metrics.