Let’s be honest, nobody likes performance reviews – neither the person being reviewed nor those conducting the review. Some have reported they would rather have a root canal than a performance review. The irony is that modern dentistry is now largely painless, but for many organizations little has changed in how performance reviews are conducted. There is little empirical evidence that traditional review processes actually improve performance in the longterm. More often they are a stressful distraction, and may actually do more harm than good. But this doesn’t need to be the case. A change in the way organizations approach performance review can actually strengthen performance and relationships.
The following are some points to consider before embarking on your next performance review process. A more detailed guide can be found on the BCSTA website at: https://goo.gl/UD2AU8
Know clearly why your organization does performance reviews
This may seem obvious but frequently an organization’s professed goals for performance review don’t align with methods they choose and the outcomes they achieve. Stand-alone report card style processes may satisfy contract requirements and allow the organization to say that it monitors performance but you need to ask yourself if putting someone’s performance under the microscope once a year tells you anything you don’t already know – and at what price? I’m not suggesting organizations abandon performance reviews but a different philosophy, approach and commitment is needed if they are going to be anything more than an administrative exercise. If strengthening performance is truly the goal, then the following principles need to be taken into consideration.
Link your performance review process intricately to your strategic plan
It goes without saying (or should) that organizations need to have a robust and ongoing strategic planning process that re-enforces its purpose for being, establishes long-term goals and identifies measurable yearly outcomes for the organization. It answers the key questions of what success looks like and how you will know it when you see it. Performance review is a logical extension of the strategic plan. But you may be surprised at the number of performance review processes that merely gather perceptions about sets of performance competencies that may or may not actually be related to how the individual is supposed to be helping to move the organization towards its goals. Don’t get me wrong, assessing competencies has its place in performance review, but not as an isolated generic check list. From the Board of Directors through the CEO and to every employee there should be a set of expectations derived from broad strategic goals and cascading through to specific performance outcomes for each individual. The role of the strategic plan is to tell employees where the organization needs to go. The role of performance review is to help the organization and its employees assess how they are doing in moving towards those goals.
Focus your process more on what will happen rather than what did happen
The majority of performance review processes tend to be report card style reviews of performance over the past year. As a starting point that’s not necessarily a bad thing – the past should inform the future – but unfortunately there is rarely any meaningful discussion about the year ahead. Again, linked to the strategic plan, what does the individual’s performance over the past year tell them what is working well, what can be changed, and most importantly of all, what they are going to do to support the organization’s goals for the coming year?
Do the review with not to
One of the main reasons that performance review is disliked by both those being reviewed and those doing the review is that it tends to be a process that is done to the employee rather than done with them. Being judged and sitting in judgement is uncomfortable at best and damaging at worst. By building a process to one where the employee helps to determine what is being assessed and how helps to shift the playing field somewhat as well as the responsibility for determining what to do with the results. In fact, this is a critical step in linking employee performance to performance planning. The first step in such a process is an opportunity for the employee to propose key outcomes and competencies that align with the current strategic plan and the employee’s role in supporting it. This is not to suggest that employees totally build their own reviews. It is a conversation where priorities are mutually identified and agreed upon. Yes, this takes more time than a pre-set evaluation form but the investment is invaluable both in the findings and their application.
Your organization’s performance review process should be well known, scheduled, and transparent – for all employees and the board as well. In fact, it should be part of your hiring/orientation process so that when staff sign on they understand what the process is, how it is conducted and when. This is not just about making people feel more comfortable, although that’s reason enough. Performance review processes that are inconsistent or are not well understood can be open to challenges on their validity, especially if the outcomes have negative consequences for the employee.
Don’t get hung up on numbers
Many performance review processes are built around items with some form of rating scale. These types of systems are seductive because they make it easier for those providing input on someone’s performance. Numerical scores and their resulting charts and comparators give the process a false sense of scientific reliability. The reality is that unless you are assessing some observable and measurable skill the numbers will be highly subjective and of little empirical value. Determining someone’s leadership or decision making skills is not like measuring their hat size. That doesn’t mean that rating scales have no value, particularly when they are a composite of several independent raters. But even then they are at best only indicators of performance areas where there is a perception of a strength or weakness, not proof of one. Scores are opportunities for discussion, deeper exploration and self-reflection. They are perhaps indicators but not evidence.
Go deep not broad
A problem with many performance review processes is that they attempt to assess too many things. This is especially a problem with competency based lists. There are a number of problems with this approach. Firstly, those doing the rating are unlikely to have valid input on multiple factors. The tendency is to make a general impression of the person being evaluated and then to rate the various factors around that general perception. More importantly, the person being assessed is unable to respond to the large number of items in any meaningful way. It is far better to identify four to six factors that are particularly relevant to the individual’s specific role and current conditions. As pointed out earlier, these should be identified as the first step in the review process through discussion with the employee, a review of the last performance evaluation, and consideration of any upcoming tasks and goals. It is far better to have deeper more meaningful discussions about a few performance areas rather than a shallow fly-by of several generic ones. They key message here is to identify and focus on what matters most.
Don’t let performance review take the place of performance management
Having a scheduled performance review process is critical to its success. However, the formal process should not take the place of ongoing communication with employees on their performance. There is sometimes a temptation to put off providing performance feedback, saving it for the formal review. But we know that for feedback to be successful it needs to be provided as close to the performance as possible. This is true both for positive and corrective feedback. Storing up the feedback for an annual review does little to change or reinforce performance and works against the earlier stated no surprises principle.
Make it an ongoing process
Rather than a once a year formal review consider a process that involves the following steps: (1) Performance Planning; (2) Informal Check-ins; (3) Formal Summative Review that leads back to the first step – planning performance for the next cycle. At the beginning of the cycle the employee and reviewer identify a few key goals and competencies that will be needed to successfully support the organization’s strategic plan for the coming year. Once these are agreed to a few informal check-ins are scheduled throughout the year to discuss progress on the plan. This is an opportunity for the employee to do some self assessment on progress and any challenges that may e getting in the way. It is also an opportunity to modify the goals if external events have arisen that take priority or blocking success. The final step if a more formal summary of the year. This can include input from others and review of the check-in conversations. If the first two steps have been followed there should be no surprises for either party in the third step. Most importantly, this step leads into the next cycle. What did we learn from last year that will help in the year ahead? What should we do more of/less of? What are the most important things we need to pay attention to in the coming year based on the review and any updates to the strategic plan?
Link employee performance review with board performance review
If your organization is lead by a Board of Directors the board should also be doing its own performance review, which should also be tied to the strategic planning process. There are a number of ways a Board can go about its own review – a topic of a future blog post – but the principles are the same as those listed above for employees: What do we need to achieve? How will we get there? How are we doing? Board self-review not only helps the Board to keep itself on track and accountable but sends a strong message to the entire organization that planning and reviewing performance is part of the organization’s DNA.
Lastly, organizations are well advised to get help in designing and implementing a performance review process. There is good research on good and not so good processes, and the stakes are high. To be clear, I am not suggesting that organizations hand off performance reviews to an outside consultant or company. It is the organization’s responsibility to take ownership of the process and outsourcing can disconnect the process from deep organizational learning. But an experienced facilitator/advisor can certainly help the organization plan the process.
The above suggestions might at first glance appear to take too much time and effort but my experience has been just the opposite. A well designed, on-going process can be done in just a few hours per employee each year. And consider this, isn’t spending a few extra hours a year having meaningful discussions with employees on how their performance links with and builds on the organization’s success a worthwhile investment? I think so.