In a strategic move aimed at staying competitive in an evolving automotive industry, General Motors (GM) has announced significant changes to its salaried performance evaluation and bonus plan.
These alterations are designed to attract top talent, reward high achievers, and address underperformance head-on.
General Motors: A Shifting Automotive Industry
The automotive industry is undergoing a multiyear transformation. New players are entering the market, and the race toward electric vehicles (EVs) is accelerating.
To thrive in this dynamic environment, General Motors recognizes the need to evolve continually. As Ken Fendick, Head of GM Global Talent, succinctly puts it:
“In order to win as a company, we must continue to evolve so we can meet the challenges ahead.”
Ken added, “That means setting high standards, holding each other accountable, and providing clear expectations when it comes to performance.”
The Key Changes
GM’s revamped performance evaluation system introduces several critical modifications:
Expanded Performance Rating Scale
General Motors is bidding farewell to its traditional three-point rating system (needs improvement, meets expectations, high-performing). Instead, it’s adopting a more nuanced five-point scale:
- Significantly Exceeds Expectations
- Exceeds Expectations
- Achieves Expectations
- Partially Meets Expectations
- Does Not Meet Expectations
This shift aligns General Motors with top-performing companies across industries, including banks and Silicon Valley giants. The goal is to recognize exceptional contributions and address performance gaps effectively.
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Targeted Distribution of Ratings
General Motors expects managers to distribute ratings within their teams as follows:
- Significantly Exceeds Expectations: 5% of the team
- Exceeds Expectations: 10% of the team
- Achieves Expectations: 70% of the team
- Partially Meets Expectations: 10% of the team
- Does Not Meet Expectations: 5% of the team
This deliberate distribution ensures that high performers receive due recognition, while underperformers are identified and managed proactively.
Bonus Payout Adjustments at General Motors
GM is redefining bonus payouts to incentivize excellence.
The best performers can now earn more than the standard 100% target bonus. Kevin Kelly, GM’s spokesperson, emphasizes the company’s commitment to fostering high performance:
“GM is proud to have a culture where we foster and reward high performance, which will help us attract and retain top talent in a competitive industry environment.”
“That includes everything from ensuring employees know what is expected of them, providing feedback so they can develop, and rewarding them for their performance,” Kelly added.
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