Performance Reviews — Another Casualty of the Pandemic? Perhaps Not Such a Bad Thing…
One of the least favorite duties of managers at most levels is conducting the annual or bi-annual performance review with the people for whom they are responsible. Few people — givers or receivers — find them of much value but HR has traditionally required them for legal reasons and for use in compensation decisions.
You’ve surely participated in one of those potentially painful conversations accompanied by the sometimes extensive prep work involved by both parties, the multi-page review forms and the oft-times hazy descriptions and scales for performance levels.
Manager — “Overall, you’re a 3, meaning Average Performer. You are a valued employee!” Direct Report — “Grrr…”
In the last few years, however, some companies have moved away from this annual event and experimented with more frequent performance and coaching conversations. And there are a number of recent articles in the business press that suggest the pandemic and resulting Work From Home (WFH) phenomenon are hastening the annual review’s demise.
A March 11 Wall Street Journal article, for instance, speaks to a trend during the pandemic of companies being less inclined to terminate poor performers in the year of the virus because of various reasons, one of them being the shifting performance expectations and the ability of employees to execute on their plans. An HR advisor with Mercer LLC quoted in the article said, “The window for whether someone met their objectives last year was much wider than in the past.”
Last July your faithful commentator published a tongue-in-cheek article about the challenges of preparing for a performance review during the COVID crisis. Many managers in this 2020–21 period have found that goals and objectives, as well as behavioral expectations, needed a reset because of the changes to the world of work and to our personal lives as well.
Hear Ye — The Performance Review is not the same as the overall Performance Management Process!
An essential distinction needs to be made right here, right now. While the annual performance review activity is morphing or being abandon altogether in favor of more frequent performance and coaching conversations, the overall performance management process has never been more important. Let’s make the distinction absolutely clear with a brief recap of the performance management process/cycle.
The performance management process consists of several components: Setting expectations for a designated period of time, most often the calendar or fiscal year, resulting in some sort of agreed on plan; executing the work itself, based on the expectations and aided by ongoing feedback and coaching; the potential adjustment of expectations based on changing conditions; and some sort of closeout discussion at the end of the performance cycle followed by a re-initialization of a new plan for the next period.
Setting expectations upfront might be the most critical part of the process. Expectations must be clear and as measurable as possible. That can be especially difficult when defining behavioral expectations. “Teamwork” is often a legitimate behavioral expectation, for example, but unless it is deconstructed and described regarding what it means for this employee (“How we would know it if we saw it”) it can be too general to have sufficient meaning to provide guidance for one’s actions.
The performance review, on the other hand, is the activity that has traditionally been used at the end of that cycle to measure the extent to which the employee has met the expectations of the plan for that period. In theory, this should be a “no surprises” conversation — almost a formality, in fact — if the leader and direct report have been engaging in ongoing conversations about how things were going and making any necessary mid-course corrections.
It shouldn’t be an exercise in negotiation.
And if the expectations were well articulated and discussed at the beginning of the performance period, hopefully there would be some objective metrics (cost; quality; turnover; customer satisfaction, etc.) to provide evidence about whether the expectations were met or not.
But the “no surprises” principle doesn’t always play out.
I remember many years ago being very surprised (shocked?) by a low rating on one of my goals at my end-of-year review. I asked my boss to explain, as I was at a loss to understand the rating. He said, “ Well, back in February there was a time…” Huh?? Back in February?? And the review was being held the following January after the year had closed out. He had never given me timely feedback about his observation which meant I never had the information to try to act upon. To improve. Instead, he had simply written the incident down and he had kept it in his Mike file.
It’s been said that leaders not only learn from the best practices of their leaders, they also learn to avoid the worst practices of their leaders. The importance of “no surprises” was my takeaway from that performance review and it helped guide my own leadership practices when I became a manager.
The performance review activity also typically creates massive amounts of quicksand about rating scales and performance descriptions. Should it be a 3 scale or a 5 scale? A 10 scale? And how are the ratings calibrated? Are they relative to the person or the group or are they absolute? Is there a forced distribution so only X% can achieve high ratings or is it like the “Lake Wobegon effect” where all of the children are above average? And how are the goals to be weighted? And what is the weighting of goals vs. behaviors vs. “living the values?”
And what do you call a “3” level of performance on a 5-scale? “Average?” “Meets Expectations?” “Good Performance?” “Does Not Suck?”
Over the years as a consultant, I attended or led many, many meetings working with committees or task teams in client companies to guide them to design a superb performance management process. I’m not sure we were ever 100% successful, as the final system design and components invariably involved trade-offs and compromises, blind alleys, and rethinking of assumptions, resulting in stakeholders and users tolerating — instead of embracing — the finished product.
For years, experts, managers and users have arm-wrestled over what to do about the performance review activity. The feeling was “ It’s hard to live with it but it’s hard to live without it.” Perhaps the pandemic and resulting WFH have forced the issue and there will be a pivot of critical mass proportions toward having regular performance and coaching conversations instead of the “no surprise” (surprise!) reviews. That would be a good thing.
About the author: Mike Hoban is a business topics writer and leadership coach/ advisor. He is actively working at becoming a world-class grandpa to his five young granddaughters. In addition to his 35+ years experience as a leader, consultant and business owner he has also published extensively in Fast Company and wrote a business column for 12 years. Many of his recent commentaries — including several about leading during the COVID crisis — can be found on his LinkedIn page: https://www.linkedin.com/in/mike-hoban-b5756b6/ He can also be reached at mjhoban99@gmail.com.
Originally published at https://www.linkedin.com.
