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Abstract
This article initially summarizes the design of a new performance management program for the McKesson corporation. It then describes change management initiatives in the Medical-Surgical business unit that leveraged program implementation as an opportunity for developing a more performance-based culture. It provides examples of how the implementation team exposed the pain experienced with the current state and provided a remedy associated with the new program. Positive and/or promising results after implementation are described.
Introduction
How do you develop a culture that champions performance management as a critical leadership responsibility? How do you facilitate commitment to performance management practices? How do you encourage employee involvement in managing their own performance?
These were just some of the questions facing us in 2004 as the McKesson Corporation launched an enterprisewide initiative to standardize its performance management practices. This article describes how one McKesson business unit, McKesson Medical-Surgical, utilized this corporate initiative to make significant progress in developing a more performance-based culture.
In a more performance-based culture, the business unit would expect to see (a) employee opinion survey scores indicating workforce satisfaction with the man- agement of their performance, (b) voluntary execution of fundamental performance management practices, (c) a shared understanding that performance manage- ment is a key leadership responsibility, not a Human Resources (HR) program, (d) high levels of execution for creating performance plans, completing mid-year reviews, submitting employee self-appraisals, and conducting year-end reviews, and (e) appropriate distribution of performance scores and subsequent "pay for performance" compensation.
McKesson Background
McKesson is headquartered in San Francisco and employs over 30,000 people across North America. With revenues of $88 billion, McKesson ranked #18 in the Fortune 500 for 2007. The company has two principal segments: healthcare related technology products, known as McKesson Provider Technologies, and distribution services, known as McKesson Supply Solutions. Each of these segments has numerous business units with their particular products or service offerings.
Within McKesson Supply Solutions is McKesson Medical-Surgical, the focus of this article. Through a network of distribution centers and its 4,500 employees, this business unit distributes medical and surgical supplies to the alternate site market: physicians, surgery centers, home care providers and long-term care facilities.
McKesson has acquired approximately 75 companies since 1995 that have been aligned with or assimilated into...