Get Rid Of Performance Reviews? Sure, But What Do You Replace Them With?

Like many of my fellow HR professionals, I’ve had my fair share of time dealing with the headaches from performance reviews. Whether it is a supervisor who simply doesn’t want to do them or an employee who thinks they were unfairly evaluated, sometimes it feels like an anchor on your other activities.

And I guess I wouldn’t mind it that much if performance reviews always turned out great. The problem is that they don’t. Even the best-designed plans don’t always do the trick. And saying that most employers have the best-designed plans? That’s probably just a bit of a stretch.

The real problem is that if we are going to get rid of performance reviews, what do we replace them with?

Are Performance Reviews working?

What got me thinking about this was an article in The New York Times about the fairness of bosses when it comes to managing performance:

As anybody who has ever worked in any institution — private or public — knows, one of the primary ways employee effectiveness is judged is the performance review. And nothing could be less fair than that.

In my years studying such reviews, I’ve learned that they are subjective evaluations that measure how “comfortable” a boss is with an employee, not how much an employee contributes to overall results. They are an intimidating tool that makes employees too scared to speak their minds, lest their criticism come back to haunt them in their annual evaluations. They almost guarantee that the owners — whether they be taxpayers or shareholders — will get less bang for their buck.”

The author of that is Samuel A. Culbert, a professor of management at UCLA. He isn’t a fan of performance reviews as they exist now.  He even wrote an entire book about it too, which merits its own discussion entirely.

So where do we go if Performance Reviews suck?

And that’s all well and good, but how do you evaluate employees then? How do you determine who is doing well, who needs to move up, and who needs to move out? After all, Kevin Elkenberry and Guy Harris laid out a pretty compelling piece on how to perfect performance reviews on TLNT, but the reason why articles like these still exist is because hardly anyone follows them. Time after time, we’ve known best practices in performance reviews and simply haven’t followed them.

Then up popped a post from Ed Newman of Accidental Entrepreneur that got me thinking about what could change and still have some sort of method in effect. He writes:

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As a business owner I knew that managing performance had absolutely nothing to do with annual performance reviews. It is all about being in alignment regarding expectations and then empowering people to do their jobs. But as my business grew to the point where I was no longer the only manager, how could I ensure all of the others have set the right expectations with their employees?

My knee jerk response was to implement traditional performance management process so that I could see the evidence that performance discussions were taking place. But guess what? This wasn’t managing performance at all – it was simply documenting what happened last year.

Newman points to a company called TalentSphere that understands this concept. There are also companies such as Rypple and Sonar6 that are approaching the idea of performance reviews differently as well.

Is software the solution?

The question I have with these sorts of things is whether software is really going to fix the issue. That’s especially true in the scheme of changing a culture, where everything is based on a yearly performance review, to something more effective. Isn’t implementing software a waste of time and money until company leaders think of performance differently?

While current performance reviews lack the nuance and timing that they should, they were dead-on simple to implement across a large organization. The alternative with constant feedback loops, goals, and expectation setting is better management training. And if that were as easy as saying it, the major issues that impact the workplace because of poor management behavior would become a rarity.

So if we get rid of performance reviews, what are we going to do instead? And how would we go about implementing that sort of wide-ranging program (especially if you’re currently having issues dealing with regular performance review headaches)?

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18 Comments on “Get Rid Of Performance Reviews? Sure, But What Do You Replace Them With?

  1. these conversations always seem to be a case of hating the tool instead of the management failure–the true issue.

    performance management is supposed to be a process that aligns individual and organizational performance; ensures individuals know what to do; equips those same individuals with the skills, tools and resources to do it; checks in on gaps and challenges in order to fix them during the year; and delivers a final summary synopsis at the end. it just doesn’t happen this way. that’s not the fault of the tool or the process. the problem is that companies don’t train managers to manage and don’t hold them accountable to do so.

    f

  2. Lance, the questions you raise are very good ones. We totally agree that software (or any form of tool) is certainly not the answer alone. Tools are only as good as the principles, science or theory being applied. And yes, sustainable workforce performance improvements are almost impossible if executives are married to outmoded, industrial age theories and practices! Once more, this is a widespread problem of possessing wrong theories, as well as a widespread opportunity for adopting a theory more congruent with prevailing realities.

    Thus, the primary issue we address is helping organizations and workers better understand, accept and respond to their realities in order to unleash greater performance from people (and experience far less risks, talent loss, and wasted human potential). We have reduced this to a simple framework of “quality” based upon SHARED accountabilities that are present within every workplace relationship…for better or worse. We strongly believe this reality must be embraced by organizational leadership, and become a part of their vision if there is to be high probability of success. Indeed, ideally this becomes a meme throughout the organization.

    In sum, our value is outfitting leaders, supervisors and workers with more accurate theory and related tools for applied practice, so that each can be better illuminated about their realities and improve the quality thereof to the degree that they desire, and do so on an ongoing basis.

    Thanks for the post…Kim

    1. Accepting the issue and realizing there will be pain in implementation has to be the key to this. Once the attitude and culture has changed, it has to be much easier to go into that situation as a vendor and have confidence it will work over the long haul too.

  3. Isn’t the answer simple: weekly check-ins where you review the great stuff and the development needs? Capture the bullets each week and it’s both the prioritized action and development plan. Create clear measurements about what levels of progress on projects and progress are needed and you’re ready for comp evals as well as talent strategy conversations for where teammates can have the biggest impact. Different managers can handle different numbers of teammates, but shouldn’t it be so much simpler than most orgs make it?

    1. Of course. I mean, there are plenty of reasons employers claim it isn’t easy (from existing processes, to culture, to supervisors with too many employees, to…well, you get the point). They either have to make it a priority to look beyond the excuses and deal with all of the factors that come with change or live with a less than ideal system.

  4. I hit “post” button too soon before I could identify myself…Kim Evans, Partner @ TalentSphere and General Talent.

  5. If an employee does not deserve a raise, they likely don’t get to continue employment. The book The One Minute Manager talks about one minute goal setting, praise and reprimand. Our company has adapted this practice and we do performance reviews every day instead of annually. It’s a huge time saver and more effective.

    1. I like that of course but for a long time manager, that could be a major change. Are organizations motivated enough to push through uncomfortable change? If they aren’t, it’s going to be a long, unsuccessful journey.

  6. People hate the tol or say “get rid of the tool” because they are tools!
    They don’t use them correctly or in the right context.
    Anyone blaming a tool for performance issues are actually experiencing an I D 10 T error!

  7. When I teach performance appraisal, I start out with a model inspired by Indiana Jones:

    “In search of the right form”

    Then we move to explore the evolution of HR performance appraisal forms.

    Therein lies the problem — it’s about forms, process, things we do one time a year, fulfilling a duty. The second thing that I teach related to this topic is the theory of demotivation. Yes, everyone else has the theory of motivation but we talk about “de-motivation.” This is the core of why managers hate performance appraisal – the event, no matter how well done, is de-motivating for a large percentage of the population. And a de-motivating event costs productivity. So the well intentioned manager would prefer not to have his/her group lose productivity in response to something that is not liked by anyone.

    The question then is what do employees need? What do they want? In the series of articles I’m doing for TLNT called “From the Energy Files” – I have started a discussion about what we’ve learned from doing short pulse dialogues (we changed the word from survey to dialogue for a reason) as frequently as weekly to provide managers and employees a focal point for having interactive dialogues. At eePulse and with our clients we have been using a software solution to do this type of work, but you don’t have to do so. What is needed is a structured way to engage in dialogues about key business issues so that employees get feedback from managers and peers about their work and how they engage with others, so they reset direction when needed, and to fulfill a basic need to communicate and listen.

    We’ve learned that business discussions and learning are also done by the individual employee. I’m big on providing employees with their own personal reports so they can go in and look at how they are doing compared to others. They learn to manage their own energy at work, which affects productivity.

    Managers can learn to do peer coaching and help each other; this takes HR out of the loop of performance management. If you think “interactive conversations” not one-way performance management or performance appraisal, then the options open up.

    Personally, I’m all for the search for getting rid of performance appraisal and trying something new. It may be pulse dialogues, easy-to-use 360 tools, structured conversations, or the rigor of project management with after-action reviews that include learning for individuals. Let’s face it – merit pay budgets are an embarrassment anyway. Let’s give everyone who deserves to stay a cost-of-living increase and then find a non-merit pay way to reward accomplishment and top performance.

    Make HR processes faster, better and more useful.

    1. Great points. I think the major issue is deciding what direction you want to go to and committing to it. Easy for me to say to do it but not so easy for someone at a company (particularly a large company) to implement.

  8. Lance – really good question, and I love the discussion. First let me say that I don’t think software is ever the answer. I point to TalenSphere because they have an entirely new way of thinking in this area, and from what I have heard Ryyple and Sonar6 are also in that category.

    For those HR weenies who think it’s just because we hate the tool – This is why you are an HR weenie. Step up to the plate, and try to solve the problem from a business perspective.

    We all know that really good managers instinctively motivate, engage and manage performance on a continuous basis. It sort of makes the annual review a waste of time, because everything has already been said. The problem lies with bad managers who don’t communicate very well throughout the year and save it all for the performance appraisal.

    I agree with Fran – it’s a Management problem. And the traditional tool is like using a hammer to drive a screw.

    1. True enough. And I certainly know that you know better but many folks put the cart before the horse. They look at technology before they look at the people processes.

  9. I’m slowly getting hooked into this blog. I got to this discussion from a previous one of yours and to that from a recommendation. I can’t resist chipping in on this one too. 

    You need performance reviews – People and Company. Without them, you’re rudderless, plain and simple. In my opinion, most current processes don’t concentrate on the right things, are too cumbersome and too infrequent. 

    Software can help – but it’s not a complete answer, it can’t be because people are involved and people are funny things. The thing is, you need to build the software to support the process, not emulate the current crappy paper-based process so many HR software companies are doing today. 

    This is what inspired us to create PerformanceHub here at Cogendo – we built it from the ground up inspired by 2 things – A passion for performance and a frustration of process. Do it and do it right, you can improve overall performance for the company and the people within it. Do it wrong and you just piss everyone off.

    Rob Wheatley
    http://www.cogendo.com

  10. The question isn’t whether or not we do away with performance reviews. That’s dealing with the symptom.

    The problem is dealing with lack of leadership. Software doesn’t solve that. Crowdsourcing doesn’t solve that.
    Leaders need to be frequently reviewing the performance of their teams. Are the right people doing the right work the right way in order to drive the organization forward in meeting its objectives?
    As leaders, we need to understand the tie-ins between performance of the people and the organization and how to maximize both.

  11. Annual performance reviews definitely get a lot of bad rep from people, and mostly with good reason. Like Ed commented, “the problem lie with bad managers who don’t communicate very well throughout the year and save it all for the performance appraisal”.

    A more frequent open dialogue between employer and employee should straighten out poor performances or incorrect ways of doing things. An hour or two a year could be spread out to 10-20 minutes monthly instead, it would be more productive and get things done faster.

    If you’re at a loss, too, how to start any bigger changes in the workplace, get the hard facts first. Try our free online, fully-automated employee surveys at EmployeeSurveyToolkit.com.

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