We’ve really hammered it home this week with 3 different blog posts about the loathsome nature of annual performance reviews. While that may seem like belaboring the point, it’s 2014 and millions of employees will still be judged and berated by their managers over the next few weeks. We will not rest until something shifts.
The issue here is not just about efficiency or productivity. We have the opportunity to transform the way managers and employees interact and work together on a daily basis.
The question is not, how do we improve performance reviews? The question is, how do we develop a structure and a process to improve human performance and not simply grade people once every 12 months?
Are they working in roles that are aligned with their strengths, passions, and skills? Are the roles challenging enough that employees are pushed to learn and become better versions of their former selves?
When a role is not challenging, employees get bored. They lose the vital energy and creativity that ultimately creates a great experience for your customers. When an employee has too much challenge, they become anxious and frustrated. Find the sweet spot where employees are pushed to grow but are not overwhelmed with stress every day.
Mihaly Csikszentmihalyi wrote in his bestselling book Flow, “The more a job resembles a game – with variety, appropriate and flexible challenges, clear goals and immediate feedback — the more enjoyable it will be regardless of the worker’s level of development”.
Set clear company objectives every quarter, as well as objectives for each employee. Always enroll employees in this process. Ensure that they know the company objectives and then ask them to develop 3-5 objectives of their own that fit into those big-picture goals.
At the end of each quarter, discuss their performance. This is not to drive the behavior you want, it gives people an understanding of where they stand relative to their work so that they can improve.
As CEO of 15Five, I have learned that communication is the most important ingredient for scaling a business that people want to be a part of. For the team to perform well and feel included in the greater purpose of the company, all of our managers regularly ask employees questions. They respond to employee feedback with support and realign employees who are falling off track.
Managers are sometimes resistant to the idea of regular communication because it seems time consuming. This is especially true with larger teams. Nobody has time for weekly 1-on-1s with 7 different employees. Nobody sends mail via carrier pigeon any more either. I recommend using a communication tool to automate the process.
Asking a handful of questions each week takes mere minutes and provides insights into an employee’s world; their triumphs, challenges, and ideas. Then managers can build on that foundation with in-person meetings every so often. This communication strategy creates deep and trusted relationships between managers and employees.
Why adopt a business practice like annual performance reviews? Because everyone else does them? Just going through the motions of what is standard, won’t necessarily help the company or help employee performance.
Annual reviews can be extremely valuable in the the context of receiving reflections from managers who actually care about the growth of their employees. But instead of just analyzing performance, why not improve it? Imagine the potential that an employee (and organization) can reach when a manager says, “I know you and don’t think you are living up to your potential. Let’s develop a plan to change that for next quarter.”