Why Performance Reviews Will Mean Less This Year

OK now lets all get into the holiday spirit and sing with me. "You better watch out, you'd better not pout", "you better not cry I'm telling you why", "Your manager is doing your review!"

Thinking of past performance reviews given and received I realized that the very first one I was taught was by Santa himself. I have been conditioned from the age of 3 to know that if I were nice and not naughty I would be on Santa's bonus list. We even bribed Santa with cookies and carrots for his reindeer to show up. I compared my haul to my siblings to see who performed best by counting each other's piles. Luckily for me my parents had not applied a bell curve and eliminate Christmas for the bottom 5%. They must of had a short memory as there was always something I wanted under the tree in good and bad economic years. If you are not of Christian faith I'm sure you can substitute a like ritual of your particualr faith. As it turns out many will receive a lump of coal this year as bonus pools dwindle to a trickle. So be prepared for some unusual discussions with your boss this year.

There has been an article running on the online version of the Wall Street Journal that basically calls out the failings of performance reviews and seeks their abolishment. The author, Samuel A. Culbert, describes many of the bad attributes like being one-sided, abused for control, too subjective, static goals that shifted during the year, lack of inquiry and partnership between the manager and employee and more stuff that we already know. The answer he proffers is to throw the one sided performance review away and build meaningful relationships by having two-sided reviews where the manager and employee jointly own the outcome. All I can say is that this guy has been in academia too long and isn't current with modern techniques. Wait till he finds out that you can listen to thousands of songs out of a small plastic and metal device!

Any manager worth their salt has learned it is about the daily interactions where you maintain a continuous dialogue with your employees. You discuss the work, how is it going, what are the challenges and how are you going to approach them? How can I help? Repeat your expectations and affirm understanding via inquiry. As a leader you measure and intercede or support as needed. There are many ways, styles and techniques to build strong relatinships and to maintain honest and genuine dialogue.

Everyone deserves a scorecard on some agreed cycle. It validates the interactions, understandings and outcomes achieved. The associated salary increase and bonus should make sense in the context of the economic, business, group and personal results. If the content of the performance review is a major surprise to either party then the relationship was not effective and should be evaluated and remedied to the satisfaction of both. But let's face reality it is more to the satisfaction of the manager. The manager is accountable by definition as his or her goals are mostly the cumulative product of the subordinate's results. Employee satisfaction scores are another measure of manager whippings, I mean accountability.

If you can put aside poor quality reviews due to people being jerks, or non-confrontational or emotionally bankrupt or just generally inept I believe most reviews are done with good intent. Here's how it gets all screwed up. Let me use a scenario to clarify.

You have just entered the busiest cycle of your business year and you get a really long and convoluted email from HR with a new calendar of timelines for this year's new and improved review process. As always they shield themselves by regurgitating the company values, what it means to be a leader and the 462 steps in this year's simplified process. The email proudly announces that HR has automated the process on a new technology and will release it for your mandatory use in two days. Click on the help button for instructions. It's so simple a caveman can do it. We want all reviews completed, signed and returned in 12 days. That translates into you the manager having to drop everything else, decipher the process, communicate it to your team and they have to do the same until you hit bottom. HR will require that employees complete their self appraisals first on a different form than last year's which should be available on the HR portal had they updated the content with the right form. The manager will review each self appraisal to confirm it is on the right form, applies to the goals from last year which haven't been relevant for 364 days. The manager will evaluate the employee across 42 leadership, teamwork, technical, communication, innovation and execution attributes based on the job title and role definition provided by HR that is at best three years out of date. The manager will apply specific cases observed and measured throughout the year and communicate the employee's behavior and results, pro or con, in a clear and confident tone. You will provide a final rating from 1 through 5 (the really clever companies use colors now) where 1 means "walks on water" and 5 means "why the hell are you still here". You will schedule the 18 reviews, have a meaningful exchange, update all documents based on feedback and revert to employee for final alignment and signature. The manager will now have to make the ratings fall nicely into the designated bell curve of 1's,2's, 3's, 4's and 5's provided by HR and blessed by the CEO (really the CFO who has the algorithm for converting ratings into money). The manager will meet with their HR represenative usually before the reviews are done to get an early read on where the ratings are falling out. Just in case you didn't get the hidden message HR will illuminate your employees failings and yours to aid you in fixing the results. You complete the reviews prior to any discussions and get to have round 2 with HR where you find out you have too many 1's and 2's and 3's and not enough 4's and 5's. You plead your case that you eliminated the weak last year, set clearer goals, provided training and support and have the results to back it. That night you get to present with your peer managers to your boss and the HR reps boss the Chief of People (COP). The COP explains that her secret inquires into your business partners revealed that they would rate your team a 3 at best and your cumulative average is 2.7. Unencumbered by facts she announces that clearly you are out of touch with your partners. However, you are in touch enough with reality to know your personal hope of a 2 or higher rating has vanquished and you will be lucky to get any bonus and forget the options dude. You glance over at your boss for support but he is unable to speak due to the previous unnatural acts performed on him privately and simply nods his head in support of the COP not you. You cull new learning from this exchange. Specifically, you are aware that your performance has little to do with the work, effort and results delivered against the goals by you and your team. You must keep the COP happy as she gets to whisper in the CEO's ear. With your tail slung tightly between your legs to protect your genitals from further embarrassment you adjust the ratings and reviews and deliver them to your employees over 36 hours straight.

At least 14% are really surprised by the results, pissed off and now hate you. The COP is pleased you acquiesced but lets you know of her concern over rumblings amongst your team regarding your leadership. Oh SHIT! By the way she lets you know that she needs you to complete your list of high performers and breadown their attributes in a spread sheet they just devised with the CEO for presentation to senior management tomorrow. Oh, and how are the new goals coming? You protest that you need the business to complete their goals so you can align and partner effectively and they won't be done until next month. That's nice she says but she needs them by tomorrow anyway. Also she just got an update from the CFO and it seems the executive bonus pool wasn't large enough so IT has been cut by another 10%. Let your team know will you? By the way where are your PIPs (performance improvement plans) done for your 4's & 5's. Pips are aptly named. It provides 30 days for a really weak performer to turn it around. The poor bastard has a better chance of winning Lotto. I'd seen it happen once but it was just a head fake. The guy had a lot of political support, possibly a naughty picture of the COP, and screwed up so big his boss had to make it look good. He was saved and the COP openly praised his turn around. Finally, she says the annual employee satisfaction survey starts next week and it is really, really important your scores come up at least 5 points this year so we can get on the 100 best places to work list (and I get my bonus).

Here's the rub. This year it will be easier to give higher ratings. Why? Consider that everyone knows the economy is in the shitter so no one expects much money let alone bonuses (CEOs excluded). To soften the blow and assuage your fears of losing your job leaders will gladly proffer higher ratings knowing their is no cost attached to this year's performance. If you are still there you must be good since the employees already let go were last year's 5's,4's and some weak 3's!

Since I display an obvious contempt for all things HR I will take it upon myself to address it and offer ways to improve it in my next posting. Hoping your Thanksgiving was truly a chance for a respite from the daily grind and a chance to reflect on the many blessings we all have. I hope that in addition to the ton of turkey and stuffing digested you had room left to wash it all down with a pint of this blog.

Yours Truly,

SGV