A performance review is a conversation and not a number

performance ranking
This week I read about Microsoft abandoning its “Stack Ranking of Employees” and then I read that Yahoo just adopted a similar approach to appraising employees. These review systems require managers to rank a certain percentage of employees as poor performers with the intent of removing them. Those supporting these performance systems claim that your company is stronger by removing your poor performers. The problem I have is managers are often forced to reduce ratings in order to meet the “bell curve” ensuring a percentage of their employees are below standards. What happens if you have a really good team where there are no poor performers? That really is not an unreasonable expectation. I believe these systems lead to a competitive, cutthroat environment that is not healthy. Employees are always worried for their jobs if every quarter there is a review and if you get a couple of reviews with low ratings, you are fired. If employees have distrust with these systems that the ratings are not fair, then fear is introduced. I do believe in healthy competition and higher rewards for those who take on more risks. When I read these articles, I am glad to work for a small, private owned company.

I also dislike self-evaluation performance reviews where the employee rates himself and the manager completes the same performance ratings. Then at review time, the employee and manager compare their rankings to foster a conversation on the difference in scores. For example if the skill is “team player” and the rating scale is 1 to 7 with 7 being outstanding. The employee rates himself as a “6” and the manager rates him as a “4”. In theory this difference in score should open a healthy dialog on why they have a different opinion. In reality the employee is thinking the manager does not appreciate him and his contribution. Any further conversation is all about defending the score instead of discussing accomplishments and future potential.

One of my best performance review was when a manager said to me, lets put the paperwork aside and talk. Since that wonderful experience, I have changed my approach. I typically like to provide the formal paperwork to the employee ahead of time to read. During the performance review meeting it is a conversation about what they accomplished the past year and where their career is headed. The performance review document is used as a roadmap to ensure pertinent areas are covered instead of reviewing it line by line. Below are a few questions that employees can think about before meeting with their manager.

  • What were my important accomplishments over the past year?
  • What were the challenges I had to overcome this past year?
  • What do I hope to accomplish next year?
  • What training or skills do I need to further develop over the upcoming year?

A performance review should be a conversation and not about defending numbers. Personally, I do not want to be defined by a “number” or a “rating”. I want to be known for my accomplishments. What are your thoughts on performance reviews and forced-rank systems?

7 responses

  1. I don’t mind every component of a performance review. I don’t mind ending employment relationships that one side isn’t providing sufficient value. I just think the stacked rankings and bell curve ratings cause more harm than good. As for numbers, I was just reading how all metrics will be gamed: http://lookforwardconsulting.com/2013/11/04/scheers-law/

    1. When it comes to true poor performers, I do not have a problem with the performance review documenting the short-comings. Of course conversations and any other HR processes should be followed to work with the employee. I also think for the remaining employees the written performance review is a nice celebration of their accomplishments and where they are going with their careers. When it comes to the stacked rankings it concerns me as a manager that I might have to downgrade someone to meet the bell curve. Thanks for the link to the blog on metrics. I do agree. People will change their behavior based upon what you measure them on. Some will game the system purposely and others may not realize they are doing so but will to make the metric.

  2. I too ditched the numbers in favour of talking. I also made sure I gave myself a lot of time before to think about areas I could compliment as well as any blind spots the reviewee may have to undiscovered genius. After we talked I typed up my notes to give to them … just them so they could decide what to do with them (add to formal review or keep private). I and the reviewee enjoyed the process and it was constructive and forthright for both parties. I was told it was the best review they’d had 🙂
    It seems logical that people would prefer honesty and something of value, rather than just going through the motions for the sake of a mandated process.
    I wish someone had done the same for me 😉

    1. Shirley, I really like how you added the personal touch of typing your notes and sharing with the reviewee. And thank you for sharing your approach. I would love to see the focus on the conversation and less on the formal documentation. I prefer to keep my documentation, in general, lean and to the point. I like the idea of summarizing the conversation to enhance the written performance review. That way the employee has the best of both worlds. 🙂

  3. I’ve had problems with so many performance review because managers turn them round to focus on themselves. The stacked ranking system cannot ever work because it compares apples against chocolates, and the larger the organisation the more distorted effects. I hated having to perform them on my staff as well. At the end of the day, all my staff got bonuses and pay rises (on the odd occasions there was money available) mainly because of my ability to put better business cases forward than my colleagues – a more professional approach than shouting the loudest, but with the same net effect 😃

    Slight aside, but I don’t believe all metrics will be gamed and I’d be very wary of an employee who goes out of their way to do so ‘however long it takes’. If managers are transparent about how metrics are used (and are sensible about what to measure in the first place) this will minimise the risk of gaming.

    1. Thanks Ally for your comments. I like the “apples compared to chocolate” because it is so true.

      For me when it comes to metrics I believe: whatever you measure people will change their behavior to meet it. I like metrics that allow us to ask questions. How could we prevent that mistake from happening again? Do we need to train on this area? I have had great success with metrics when taken from an improvement perspective and not placing blame on people. (There are times when someone is to blame but that typically is a different problem.) I think when the metric is the “how many bugs did each tester find” then people may game the system. And does the number really mean anything? I wrote an article a long time on this – I will need to revise and post. It is an interesting topic.

  4. […] Many of us are counting down to Thanksgiving and getting our menus ready. I purchased a few more serving items to add to the presentation on Thanksgiving day. I love serving dishes, plates, napkins, and all those decorative pieces. Hopefully I will work a few of them into my upcoming recipe postings. There are still a few more recipes I want to try to see if they make the final menu. I also want to thank everyone who has given me support on my second blog: The Testers Edge. If you would like to know more about my earlier days as a programmer and how I became a software tester, click here. Recently Microsoft ended their controversial stack ranking of employees and Yahoo just implemented the practice. For my thoughts on performance reviews click here. […]

Now it is your turn! What are your experiences, thoughts, or observations?

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: