I recently read a great article in The New York Times called “The Power of ‘Why?’ and ‘What if?’“. The gist is that businesses need more people asking questions . Doing so may help us be innovative and solve problems better. I’ve been spending some time (on my couch, obviously) thinking about performance management. Almost universally-hated, people are finally taking a closer look at the system and solutions. This seems like a great system to attack the problem.
Why do we do performance management (in its current form)?
- To help inform compensation decisions
- To promote and coach growth
- To address performance issues
- To give feedback regularly
- Because we’re supposed to do it
- It helps “rank” employees
- To “document” issues (HR made us do it!)
- To review goals and progress
Why do people hate it so freagin’ much (in its current form)?
- It takes too much time
- Too much negative feedback
- It’s demoralizing
- Ratings or stack rankings (when used) suck for all involved
- It’s not the full picture – often there isn’t input from those closest to performance
- Comp decisions tend to overly-emphasize the most recent quarter’s successes and failures
- The process isn’t a balanced two-way exchange of feedback
- Feedback isn’t delivered in a timely manner – it’s coming way too late
- Annual, in particular, is really tough
- It seems like the review is structured to justify the compensation change to the employee
- Pressure on managers to use the review to justify compensation changes they may not agree with
What if we … ?
- Tied compensation to market data and trusted managers to put people within a market-based range depending on performance?
- Looked at compensation more frequently?
- Decoupled compensation and performance conversations?
- Pay people a lower base plus regular discretionary bonuses based on performance or completion of projects?
- What if this pushed under performers to self-select out?
- Tied reviews to projects or initiatives wrapping up instead of to a quarter or annual schedule?
- Let employees drive the process and ask for general or specific feedback when they want?
- Focused on utilizing people’s strengths, versus calling out negatives?
- Actively coached weaknesses?
- Had regular, informal career coaching?
- Judged managers/leaders by how much they helped their employees grow and develop?
- Had managers receive coaching and feedback from their teams regularly?
- Did away with the manager altogether and relied on peers and mentors to provide feedback?
It’s encouraging that some tech companies seem to be looking at the problem of performance management (and connected issues) differently and are building tools for a different type of solution. Similarly, it’s awesome to see companies looking at the data and impact of the “old” way of doing things, and using that data to drive changes. Adobe’s switch to Check-ins being a rather high-profile example.
What are your thoughts on performance management? Or, rather, what are your questions surrounding it?