Performance reviews, as they exist in most companies today, are broken. They’re a complete disaster for most employees, and we’re pretty certain most managers hate them too. A lot depends on the employee’s personal relationship with the manager, so there’s massive potential for bias. The review system also gives too much power to the manager. We’ve worked in companies where the review could be summed up as: here’s how you performed, here’s your raise, here’s your promotion (or not), unfortunately, my hands are tied, I fought for you as much as I could, next year will be better, you’ve gotten a better-than-average increment, you should be happy, NEXT EMPLOYEE, PLEASE COME IN.
They’re also prone to ‘recency’ bias – a word that Microsoft Word underlines in red when you type, so it’s not even a real word, but any serious HR professional will tell you it’s a huge problem. No manager can remember everything an employee did through the year (let’s face it, we ourselves can’t remember most things we did through the year), so they judge their employees’ performance based on tasks they did in the last month or so. A lot of managers hate the system for the same reason – they’re also human, and they’re being asked to “rank” or “grade” the people they work most closely with, based on incomplete information.
So the current system leaves employees feeling powerless, like cogs in the wheel with no control over their growth, and voiceless against the management. Sounds great for morale, doesn’t it?
More Power to the People
The single greatest motivator for employees would be to give them more control over their career trajectory and their growth within the company. In the current system, especially in large organizations, this is a tough sell – everything is geared around role descriptions that stay static for years. Employees have to be slotted into specific roles, with predetermined responsibilities, compensation and to-do tasks. No two people are alike, but multiple people are expected to perform the same job in the same way as everyone else.
It’s also understandable. Focusing on individual careers is really, really hard – and HR can’t be expected to keep track of everything that everyone is doing, or what they would rather be doing instead.
So the best way out? Give more power to the person who understands someone’s career plans best – the employee herself. Anindya Shee, VP of Talent Management and HR Tech at Cipla, says, “We need an aspiration-linked, strength-based approach to career and performance management. Organizations will need to do much more to take cognisance of people’s choices, interests and skills, and the sooner they realise and start doing this, the better.”
So how can we do this?
Make the feedback useful for employees. We spoke to Gina Lewis, Group HR Advisor at a large Indian diversified conglomerate, and she says, “Employees want feedback that is accurate, real-time and constructive. Performance systems in most companies however, fall short of these expectations. They have instead become a means to fulfilling one important “to-do” for managers and HR – i.e. helping them determine how to distribute their annual compensation budget. There is very little “management of performance” for the individual in this process.”
Speak to more people. The current system relies too heavily on the opinion of the manager, who is just one critical stakeholder. A robust performance management system should include inputs from departmental colleagues, from sub-ordinates, from senior management, from other people that this person regularly interacts with, from customer surveys. You’re thus reducing the importance of any one person’s view, and improving data reliability.
Allow for Immediate, real-time Feedback. If I’ve done something good in June, don’t make my colleague wait till March to bring it up. Let her log on and note it today itself. A system that allows for immediate recognition will eliminate recency bias, and the additional data points will make the review far more reliable.
Make it transparent to the employee. The employee should be able to see the kind of feedback she’s getting. It’ll help her understand the areas she’s good at and the areas she needs to improve upon, and also help her build a solid case during her performance review discussion. It’ll also give her manager better and more complete information – to have a better discussion on what it’ll take for the employee to progress faster and reach the next level.
A good employee performance system can be extremely empowering for individual employees, and help them plan their career path better. It’ll also help the company plan resourcing better, and over time, build data on the kinds of employees it needs, in terms of skill sets, personality traits and culture fit. Of course, some companies will be slow to embrace such a system, and others will be much faster – and transparency in career development will be a selling point for companies when they try to attract the best talent.
Disclaimer: We make one such really good performance management system, that uses tech to make recognition and feedback seamless, social, easy and accessible. Call us today!