Do I need to be more of a team player…or take ownership of projects more often? Which is it?
Due to WFH challenges amid the Covid-19 pandemic, roughly 30% of companies adjusted performance evaluations and 5% paused reviews or completely canceled them, according to a survey from McKinsey & Co. and LeanIn.org. As a simplification expert with several anti-complexity books and TED talks, I strongly believe that the percentage of companies eliminating evals should be 100%.
Why? Because the annual process for reviewing employees’ performances has become so bloated that it’s now referred to as “review season.” What began last century as a simple rating system has devolved into a measurement of everything from “met sales goals” and “achieved client success” to “takes initiative” and “collaborates well with others.” For managers, all these criteria represent multiple data points to plot, more fields to populate and endless forms to complete and submit to H.R.
Meanwhile, the average employee is bewildered about how to apply the evaluation to her day-to-day. Does she need to be more of a team player…or take ownership of projects more often? Should she follow direction better…or take more initiative? These inputs often contradict one another, leaving the employee confused and even traumatized. For a kinder, gentler and less complicated approach, check out the five alternatives below.
Modify the cadence of performance goals. For most companies, goals set in January are obsolete by end of year. Quarterly goals are far more practical — and quarterly reviews are a more accurate reflection of the employee’s overall performance. “Companies that set performance goals quarterly generate 31% greater returns from their performance process than those who do it annually, said Josh Bersin, H.R. researcher and expert. “And those who do it monthly get even better results.”
Speaking of monthly check-ins. Rather than withhold feedback until the annual review season, managers at professional services company Accenture feedback employees all year long. Likewise, managers and employees at The Gap, Inc., are encouraged to have 12 informal, undocumented conversations about performance during the fiscal year. By coaching people in real-time — instead of bringing up mistakes or successes from months ago — these touchpoints enable managers to resolve performance issues more efficiently (and less stressfully) than in a formal review.
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Conduct real-time retrospectives. Global leader Deloitte replaced its review process with “performance snapshots,” which evaluate an employee at a single moment in time rather than over an entire year. Typically done after a project is completed, snapshots enable managers to dialogue with employees about their performance while the project is still top of mind. In this context, performance recognition can be given; challenges or obstacles can be identified; and if needed, upskilling can be scheduled.
Manage it through an app. In 2016, General Electric cancelled annual talent reviews for its employees, replacing those evals with touchpoint discussions between managers and employees about goal progress. Rather than relying on performance scores or rankings, it rolled out PD@GE, a smartphone app designed to compel more frequent and deeper conversations between managers and employees. The app enables a constant exchange of year-round feedback; and participants can receive suggestions from anyone in their network, including upper management and employees on other teams.
Provide mandatory compensation training for managers. Plenty of naysayers have asked me how pay raises can be awarded if ratings aren’t compiled? I point them to Adobe, which has used a management development program since 2012 to address this. Managers are given access to an internal salary tool illustrating where each employee falls in the salary range for his or her role. From a set pool of money, managers are empowered to give pay increases, keeping the following criteria in mind:
· How is the employee performing relative to established objectives?
· Is this employee competitively paid?
· What kind of impact are they making and how critical is the role they are playing in the business?
· Does this employee have unique skills that are difficult to find in the market?
Giving feedback regularly to your direct reports sends the message that you’re invested in their success at the company. Whenever possible, connect your feedback to organizational strategy or leadership values so people can see how their individual performance aligns with the business holistically. When employees have a clear understanding of what they need to improve or change in order to be promoted, they’re more likely to stay with their current employer.
Whether you’re ready to update your review process or not, the shift is already underway. Organizations using ranking systems and nonstop forms will fall behind those opting for simpler and more humane approaches to talent management. In the workplaces of tomorrow, real-time feedback and training will be supported by technology — not complicated by it.
