Does AI-Flavored Feedback Require a Human Touch?

Digital tools and technologies are now relentlessly and remorselessly transforming how performance management works. Customized and continuous data-driven feedback is becoming a new normal for enterprises worldwide. This feedback appears both qualitatively and quantitatively superior to its performance review precursors and should lead to better outcomes. But does AI-flavored feedback require a human touch to measurably improve its impact?

Organizations committed to state-of-the-art talent management are revisiting the role managers should play in delivering, facilitating, and/or curating employee feedback. Are managers mainly conduits for criticism? Or do they add meaningful value and insight? “We know that putting the manager back in performance management is one of the keys to making it work,” states McKinsey & Co. partner Bryan Hancock during a recent webinar on performance management. “You can create the best system in the world with the best amount of employee involvement,” he continues, “but if at key junctures, the managers aren’t taking responsibility, it’s a problem” — especially since Netflix, Google, Amazon, and other digital innovators have successfully personalized sophisticated analytic assessments for their users.

Whether average managers represent an organization’s best option for constructively critiquing employees is now an open and important question. Preliminary findings from our recent research suggest that ongoing investment and innovation in AI capabilities will provoke conflicting answers. The implications for legacy HR and people management are enormous.

This research highlights how direct managerial involvement both complements and competes with data-determined performance reviews. Increasingly, organizations are discovering they must explicitly choose whether humans or machines should get the last word on people’s performance. This process is as much about cultural transformation as organizational transition. However, productively balancing analytic insight with managerial interaction is challenging. Who owns the feedback?

IBM’s digital journey offers a superb case study in confronting these performance management challenges. The company’s HR leadership, for example, explicitly tracks managerial impact on employee engagement and outcomes.

“The role of the manager is incredibly important still, even in an agile culture,” acknowledges Diane Gherson, IBM’s chief human resources officer and senior vice president of human resources. “If there’s a manager who’s not ‘bought in’ or not engaged, the chances of their people not being engaged is something like three times higher. Making sure that managers fully understand the strategy and are fully engaged really can’t be forgotten.�