Top Companies Tossing (or Taming) Performance Reviews in Favor of Fast Feedback

Top companies such as Adobe, Juniper Systems, and Medtronic and have already tossed out annual performance reviews. Many other companies are reducing their importance while dramatically beefing up feedback from leaders in real time. Other companies such as Twitter, Google, and Facebook have stepped up the rate of performance feedback as they separate reviews from pay and promotion decisions, get rid of “stacked” or forced rankings, and empower managers to give raises and enhance responsibilities to many (or all at once) in their excellent groups.

Why is this happening? 

Employees and managers in these and other companies hate traditional performance reviews lower morale without increasing performance. In companies that still rely on formal, written performance reviews, managers often hold back their feedback and save up the dreaded conversations until the annual ritual. Employees feel unfairly sliced, diced, and judged. Almost no one thinks this is the best way to develop people’s careers or performance.

Domino effect of forced rankings

With stacked rankings, a leader of an eight-person team has to rank the names from top to bottom, with no ties. In their annual performance reviews, the ratings have to reflect the rankings. I bet there are many managers who stay up late at night reverse-engineering these ratings to reflect rankings, even when everyone on their team is pretty damn good! Worst of all, they have to explain to each team member who is ranked poorly why they are a mediocre or poor performer, and then follow it up with a salary decision to match.

Wait a minute.

I thought the goal was to attract great talent, show them what a great culture you have, and retain your people based on their development, engagement, and great relationships with their boss.

While it is true that the requirement of traditional performance reviews isn’t the only barrier to bosses giving fast and helpful feedback, it does eat up a lot energy and distracts bosses’  focus away from day-to-day, weekly, or monthly feedback that lets people know where they stand and how they can excel.

How to turn this around (even if you have to do performance reviews)

If you have at least 8 months ’til they’re due, forget about performance reviews.

1. Focus on what you need the team and each individual to do in order to reach your goals. Let them know what these items are and explain that you will be giving frequent feedback.

2. Meet with everyone once a week for a few weeks to give honest, helpful feedback on those items. Stay focused on 1-2 messages at a time.

3. In each conversation, ask for feedback on how you can support them in accomplishing these goals.

4. Include positive feedback as much as possible.

5. Keep it up, but get faster and less stressed. Notice people trust you more.

6. When it’s time for performance reviews, notice how much easier it is than it was last year.

Unfortunately, I don’t have great advice on how to make stacked rankings work well. You may have to campaign to get rid of them at your company. And maybe, because performance in your group will be so great, they will listen to you...