Bryan Hancock, Bill Schaninger

We found through our research […] what drives perceived fairness in the performance-management process. One of the drivers of fairness is that you understand how what you’re working on fits in the bigger picture. […] The second driver of fairness is that there’s an ongoing component. “My manager has an ongoing conversation with me about how I’m doing, so I’m not surprised. I know what I’m working on, how it fits in. My manager has the conversation with me.” The third component of fairness is about differentiated compensations, and, in particular, two kinds of differentiation. One type of differentiated compensation is making sure that the people who are loafing aren’t making the same as what others are making. Because that’s not fair. They’re not pulling their fair share. And the other is that we’re recognizing, and fairly recognizing, those who are disproportionately good performers. […] Yes, they should be making a bit more, and recognizing that raises the perceived fairness for everybody. For companies, when they get those three elements right, it raises the perception of fairness of the overall performance-management process.

If you were to convert those claims […] into plain language: “I’d like to know someone cares about me. I’d like to know the things I’m working on matter.

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