Case Studies

CHG Healthcare Services uses 360 Degree Feedback and Employee Engagement Results to Predict Performance

Background

CHG Healthcare Services is one of the oldest and largest healthcare staffing firms in the United States. Founded in 1979, CHG provides both temporary and permanent placement of physicians, nurses, and allied health professionals.

Measuring Performance
"We have been gathering information on our financial and service performance since day one," says Michael Weinholtz, CHG president and CEO." But we knew that overall business success is an outcome of more than just operational performance. We are a business that is based on people. Our ability to attract, motivate, manage, and retain talented employees is key to the company's bottom line, and we knew that we needed a way to measure those factors." CHG discovered that DecisionWise 360-degree assessments provided an effective way to measure individual strengths and areas for development. Coupled with regular DecisionWise employee engagement surveys, this overall feedback offered some enlightening information.

Predictor of Success
"We noticed something interesting when we looked at feedback and performance," added Kevin Ricklefs, CHG's vice president of administration. "We found that 360-degree feedback not only provided an understanding of a manager's past behavior, it also acted as a predictor of future success. When we placed these individual results side by side with the employee survey results of that same manager, we saw they were directly related. Then when we looked at that manager's performance, the relationship was clear." DecisionWise worked with CHG to analyze findings and provide suggestions for improvement.

As CHG soon discovered, there is a direct relationship between a manager's individual behavior, the overall engagement of that manager's team, and its general success. Managers scoring highest on their individual 360-degree reports typically logged similarly high marks on the employee engagement scores for their immediate departments. Solid individual 360-degree scores had a strong correlation with good team engagement scores. Likewise, a number of studies have shown that the level of employee engagement influences operational performance as measured by turnover, financial profitability, efficiency, quality, customer satisfaction, ROI, and stock price.

The Performance Lag Cycle
CHG and DecisionWise also found another important factor—the Performance Lag Cycle. We found that managers who received low individual 360-degree feedback scores could still hit financial targets in the short term. Yet managers who fell into this category eventually experienced declining employee engagement. This, in turn, affected operational performance. The time between an individual's behavior and when it affects his team's engagement, which eventually influences financial and operational performance, is referred to as a performance lag cycle.

This performance lag cycle generally took place over a little more than a year. The results of a manager's 360-degree feedback served as a predictor of financial or operational success over the next year. Those managers who registered low 360-degree scores, yet demonstrated successful financial performance, were often no longer performing as well 12 to 14 months later.

Early Intervention
CHG ensured that, in addition to continual review of the financials, it would keep regular watch on the softer side of organizational performance. "We see 360-degree feedback and employee engagement as part of our performance metrics," says CHG's Ricklefs. "Low 360 scores are a warning that employee engagement is likely to decrease unless something changes. Poor engagement scores are a signal that team performance will suffer down the road." CHG was able to identify potential concerns through 360-degree feedback and employee engagement results that were remedied prior to affecting financial performance.

DecisionWise works regularly with CHG Healthcare to understand, measure, and improve leadership and organizational performance by providing coaching, as well as conducting 360-degree assessments, employee engagement assessments, leadership potential analysis, and service and satisfaction studies.