Performance reviews… oh geez, where to begin…

If you’ve worked for pretty much any company barring a few notable exceptions, you have been through some form of performance review before. You’ve probably been told to prepare some documentation of what you have worked on over the year (or half-year, or whatever blocks management like to divide the calendar up into), maybe provide a rating for yourself, and maybe even been told to ask your colleagues to ‘review’ you as well.

These reviews occur at most levels of an organisation. Front-line staff get them, middle management get them, and even senior management go through forms of them. The board may even sometimes consider shareholder votes on particular subjects as a form of approval for their bonuses.

Reading all of that, it might sound like it makes sense to be doing them. After all, we want to make sure that ‘the people’ are doing ‘the things’, right?

To answer that question, we really need to go back to the purpose of performance reviews in the first place.

What is it that they do for us?

A typical performance review cycle is often linked to remuneration, bonuses, promotions and the like. Management in command and control organisations will often link this as a reason for paying more. After all, “if they can’t measure, they can’t manage”. Ugh.

So, managers like to see the purpose of performance reviews as a way to measure and benchmark employees in order to motivate (or deny) further incentives. It can often be used as a game of carrot and stick – if employees jump through the sufficient hoops, we might think about giving them a few more bucks to spend on smushed avo each morning. And we’ll do this only once a year. On a Friday. Maybe.

How they work…

Anyone who’s been through these cycles has likely experienced a bit of a crush towards the end of the cycle. Gather up all your ‘evidence’ that you’ve done your job, present it in a particular format, at a particular time and date. Someone will take all this information, have a chat with you about it, and then match it against your peers to see how you compare on the bell-curve of life.

Fair? Not in the slightest!

As often as organisations refuse to admit it, there’s nearly always a number that they need to hit in regards to ‘performance’. It’s usually an unwritten target to ensure an even spread across the curve – manipulating performance to match a management target. They often have a budget for raises, bonuses, and the like. If everyone was to hit a 5-out-of-5, the budget would be blown… so, management play games with their own system by moving the targets, and bumping up (and down) employees in an everlasting favouritism play.

Then there’s politics, and politics are the worst of all. Someone says something in a meeting that doesn’t jive with the party line, or is considered a disruptor, and most organisations will find a way to keep them down. A wink and a nod, and the blacklisting begins, subconsciously or not, overtly or covertly.

Most executives will sit there stone-faced and swear these things never happen. Their system is honest, rewards successes appropriately, and works just fine, thanks.

Sure, keep deluding yourselves. Your system is broken.

The unfairest of examples

Most workplaces have a know-it-all. This person knows about a lot of little bits of the organisation, as well as their job. And this particular person will often be called upon for support in the every-day situations. “How do I contact this team?” “Where do I go to find out this information?” “What happens when X comes up against Y?”

All of this ‘stuff’ takes time. And it’s quite often a lot of time: a group of 10 people might be calling on one person only 15 minutes a day each, but have all of a sudden monopolised over 2 hours a day, or 25% of this individual’s 8-hour standard day.

25% of all of the work they do is going into supporting the rest of the group; this person is invaluable.

The performance cycle does not typically see it that way though.

The discussions might often go something like this…

“What have you been working on?”

“I helped Jenny fix her email because the client wasn’t connecting to the server. Then I helped Mike get in touch with Anton in payroll because there was a problem with their expense reimbursement. Sam also needs some help with proofing her presentation for the executive this afternoon so I will be jumping into that shortly.”

“… umm… what about the work I assigned you?”

“It’s on my list, I will get to it. I am also just making sure everyone else is able to function here, too.”

“Yeah, that’s not your job. They can come to me, or call support.”

The manager is missing the point altogether; without this person, their entire team will fall behind. The fact that the manager doesn’t rate fixing Jenny’s email as something worthy is a problem in itself. When it comes around to performance review time, and this person puts down the fact that they spent over a quarter of the year making sure the wheels still turned, it’s discarded because it wasn’t what the manager assigned.

The manager might also feel they are being sidestepped or cut out of the loop. Their people are going to this person for help instead of them… and an insecure manager who doesn’t know how to delegate properly, or enable their people will often fall into this trap. It’s not their fault, as they are stuck in the broken system too, going through the same things. This behaviour propagates from the top.

What’s missing here?

The manager has forgotten the 9 other major pieces of work that got done, that might not have if this one person hasn’t helped the team. And because the system says that they must compare person against person, this one extremely helpful individual is struck off the list. “They didn’t complete their assigned tasks on time”. Ugh.

Pitting people against each other, and averaging to define some kind of value in their contributions is the problem. Averages are an absolute joke when trying to find what normal looks like.

Have a look at this amazing article about why there is no such thing as an ‘average’ person: When U.S. air force discovered the flaw of averages

What to do instead…

Organisations like Accenture and Deloitte – major global consultancies – have ditched traditional performance reviews. Their CEOs both shared similar messages when they did it, too. Comparing people against people is not fair, doesn’t work, and does not accurately define their contribution.

Instead, they moved to a discussion-based understanding. A respectful conversation that is not time-bound or looking to achieve a particular outcome. An ongoing employee engagement that looks to understand the day-to-day fundamentals of their people, and how they can do more to enable them. This has the potential to result in a number of really interesting side-effects:

  • Budgeting for salary changes becomes on-going and rolling. It’s no longer time-boxed, and there is no crunch period taking people out of work to compile crazy information about ‘how they did their jobs’.
  • People can move around in an organisation much more easily. Promotions can become awarded, not based on continual needle movement, but on real contributions made to customers and the organisation.
  • Reduced pressure due to on-going support in roles and job functions, greater collaboration and reduced stress for employees.

This really sounds like it’s a no-brainer. The trouble that comes in is when the typical command-and-control organisation goes back to their old adage “if they can’t measure, they can’t manage”. The CFO will likely spin all sorts of wonderful lines about how salary budgets will blow out and become uncontrollable, and everyone will get raises all the time. The COO will have less ways to tie ‘performance’ to ‘operational metrics’. Shareholders will cry, and the universe will implode.

Except it won’t, and they are all wrong. Large companies around the world are doing this right now, with extremely positive effects in both customer experience – because their people are now more focused on work instead of pressured to hit a target – and subsequent company revenue increases.

Throw the carrot and the stick into the bin. People want to do good things. Let them, and help them.

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