Performance Culture for Global Teams

Performance appraisals, or performance reviews as they are more commonly known, are almost universally recognized as a way to measure employee performance, decide compensation, and encourage personal growth. In an exceedingly global arena for companies around the world, one single answer to appraise performance does not exist - and this causes problems for companies that are trying to expand to other regions.



In Tokyo, where I am based, my experience with clients who are looking for performance appraisal systems are usually running the Management by Objective model, or MBO. This model is split into two periods - one at the beginning of the year/quarter/etc., where individual employees set their goals.


This structured way of evaluating employees is a hallmark of Japanese business culture - an emphasis on the company and a structured approach to setting goals. Another important aspect of performance management in Japan are the company goals - cascading objectives that range from company targets to more concrete goals by division or department. This pyramidical structure of goals is also another emphasis on structured culture in Japan.


On the other hand, companies in the US (the other culture that I have spent considerable time a part of) does not have a lot of emphasis on structured objectives management. Recently, there has been an increase in frequent feedback and a focus on personal growth throughout companies in the United States.


For CEOs and CHROs in Japan, communication skills and the ability to converse in English are some of the most sought after for "global talent"; employees that are expected to contribute in markets outside of Japan. I believe that this holds true for company culture in the US - the ability to communicate your thoughts, goals, and opinions to others.


This emphasis on communication and frequent discussion is what drives performance management in the US. Rather than structure and putting the company first, performance appraisals are more built around communication and personal growth.


The US and Japan are just two examples that I have written about here, and only because I have been immersed in both cultures for a long time. With almost 200 countries globally and countless cultures within each of those countries, global companies need to be aware of different cultural norms when expanding to foreign lands.


The current state of top-down performance management for companies expanding overseas is inadequate - particularly from a cultural aspect, as I have stated earlier in this post. Here is one way to circumvent disgruntled local hires for global companies - Leverage local hires and gain their input on your performance management system.

Find out what values are important to locals - and where the current performance management framework is not meeting their standards. Upholding company culture is one thing, but when it clashes with the culture it results in counterproductive management. By shooting for an optimal mix of cultural expectations and company expectations, you can expect happier employees that uphold company values.