When major corporations like Adobe, GE, Deloitte, and Microsoft ditched their annual performance reviews, they set off sea change in the world of performance management. There’s now nearly universal agreement that these antiquated practices don’t work and need to go, but very little agreement about what to do instead. This gap has left HR and business leaders scratching their heads.
Last month I sent an email to all of our employees (which I’ve included below) where I shared my vision for 15Five’s next major thrust — namely, how we intend to replace the annual performance review with something uniquely designed for the times we find ourselves in today.
It should be no surprise that the practice of traditional annual performance reviews is finally being abandoned, given the fact that the world of work looks very different than it did when the annual performance appraisals first rose to prominence in the 1940s. We humans tend to create practices designed to address the situations we face at a specific point in time, but then cling to those same practices far beyond their useful life, until they actually become counter-productive.
In the case of annual reviews, they’re not only an ineffective holdover of a bygone age, but in many situations are also actually detrimental to the teams, individuals and company cultures that utilize them.
In a recent HBR article about this shift, Peter Cappelli and Anna Tavis share a story about the head of HR of the drugmaker Coloran, who back in 2002 abandoned the annual performance review and replaced it with what he’d found was a more effective way of reinforcing desired behaviors. The article continues,
Back then the idea of abandoning the traditional appraisal process — and all that followed from it — seemed heretical. But now, by some estimates, more than one-third of U.S. companies are doing just that. From Silicon Valley to New York, and in offices across the world, firms are replacing annual reviews with frequent, informal check-ins between managers and employees.
My company 15Five just happened to find ourselves in the middle of this massive shift. We pioneered the use of technology to facilitate those very same frequent, informal check-ins between managers and employees that so many companies have been flocking to. That’s been great for business, but I’ve also had a sense for a long time that it’s not enough.
Yes, I agree that performance reviews in their traditional form (typically done annually, often cumbersome, more backward than forward-looking, and more focused more on giving someone a grade than authentically helping them improve themselves or their performance over time) need to go, but I think abandoning them entirely is throwing the baby out with the bathwater.
There is great benefit to the practice of reflection, both self-reflection as well as the reflection we receive from others. Reflecting weekly during something like a check-in is wonderful for making sure that we and the people who work for us are staying on track, are able to course correct when need be, and are able to give and get the continuous feedback necessary to perform at our best.
But weekly is far too frequent an interval to reflect on how we’re growing and developing over time. Given the pace and nature of business today combined with the pitfalls of recency bias (i.e. we give far more weight and credence to our recent memories), annually is far too long. If we’re going to create a structure to support someone in growing and developing over time, we need something in between.
So, I’ve wondered, if we were starting with an absolutely clean slate, what might we create for the times we find ourselves in today?
My answer to that question is detailed in the email below that I shared with 15Five employees last month.
I would love to hear your thoughts and feedback in the comments below. And if you want to come along with us on this journey (we’re planning to release by the end of November), you can find us at http://15five.com.
P.S. Harvard Business Review has done a stellar job at tracking the development of this shift. If you want to read further, check out the now famous April 2015 article Reinventing Performance Management and The Performance Management Revolution: The Future of Performance Reviews published in their October 2016 issue.
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— — — — — Forwarded message — — — — —
From: David Hassell
Date: Thu, Sep 7, 2017 at 2:27 PM
Subject: 15Five Reviews
To: 15Five Team
It’s been a long-time vision of ours to reinvent the performance review. It’s clear now to almost everyone in the world of HR that the old model of traditional, cumbersome, tedious, lengthy, annual reviews are not only ineffective and “cost” more than the return they provide, but in many cases are actually detrimental to employees and the companies they work at.
15Five to date has been already part of the solution, providing regular, agile, lightweight communication between managers and their employees. Some companies have even tossed out their review processes entirely and relied solely on 15Five to fill in the gap (Colleen McCreary at Vevo and her previous companies come to mind).
But we’ve always believed that’s only part of the solution, that there needed to be a cycle of reflection and intention setting that’s longer than a week, but far shorter than the annual cycle (which is prone to the recency bias of only the immediately preceding few months anyway, and which also occurs so infrequently it’s out of people’s normal workflow, so getting compliance is extremely challenging).
To that end, we’ve always imagined a review process that was quarterly, lightweight, beautiful and even delightful to use, focused far more on supporting employees in becoming their best selves than simply giving them a grade (although still giving employers a way to assess their people), and that’s ultimately developed with a framework based on positive psychology and the growth mindset.
To date, while there’s now nearly universal agreement that traditional performance reviews are deeply flawed if not outright dead, there isn’t yet universal agreement on what to do instead. I believe our solution can be what’s next.
Creating the space for people to be their greatest selves. Unlocking the potential of every member of the global workforce. These are our Mission and Vision, and why we exist. And while it’s clear the conversations that 15Five naturally initiates create more openness, transparency, accountability and ultimately trust inside of teams, and it’s clear that 15Five lets managers and employees have a much greater pulse on their people (both of which are major cornerstones necessary for people to thrive in the workplace), we’ve still been a bit shy on really making clear the deeper purpose and intention of the product and our company.
I believe we have an opportunity with this Reviews feature to set an entirely different and more powerful context and purpose for not only Reviews but the entire 15Five product. And I believe this has the potential to lead to the greatest performance possible over time for teams that use 15Five, by supporting people in leveraging their strengths and growing and evolving into the best versions of themselves over time. This is our brand promise, and we’ve never been closer to being able to fully deliver on it.
I’m extremely proud of our product team for stepping up and getting the initial MVP of this product on the glass so quickly and completely. There’s still much to be done and we’ll be building upon this foundation for some time to come, but this initial version gets us in the game so we can start bringing our vision to life. The time is clearly now.
Ironically, it seems the hardest part of this process thus far has been what to call this thing! The term “Performance Review” is a loaded term. It has already taken on a particular meaning to most people, and many people have a negative emotional experience simply thinking about it. It’s most often preceded by the word “dreaded.” Hitching ourselves to that language would be a very poor choice.
When inventing something new, there’s always an opportunity to create something new in language as well. Simon Sinek brilliantly did this with his concept of WHY. The terms “mission” and “vision” had become misused and abused to the point where there’d lost their meaning and in many cases gave rise to skepticism and cynicism. He was able to point to the power and truth of the concepts that they initially stood for, and breathed new life into the importance of purpose in the business world.
We have the opportunity to do the same. Creating something completely new however also has it’s risks. It can alienate people or be too far out of a reach or stretch from their existing worldview and what they’re looking for. For that reason, we decided to keep the word “Reviews” but to re-contextualize it with something other than “Performance”. Keeping the word Reviews allows us to create a bridge for people who are looking for a “performance review.” Re-contextualizing Review with a different adjective allows us to create an entirely new context and perspective, giving it that new life we’re looking for.
One of the biggest shifts we intend to make around Reviews is to shift the context for employees from one where it seems that it’s primarily about being judged and graded to one where it’s primarily about supporting them on their journey of continued growth, development, impact and success (while still maintaining there still is an essential component allowing the manager/employer to effectively assess their people).
In choosing a name, we wanted to come up with an adjective that made it abundantly clear that the purpose of the Review (which ultimately will become the starting and ending point of a person’s experience of 15Five), is about helping people grow and evolve into their greatest selves. We firmly believe that individual high performance is a natural byproduct of someone being, and becoming, their Best Self.
For that reason, we’ve decided to call this feature the Best-Self Review. Inside of 15Five’s navigation, we will simply refer to this as “Reviews” but once you get into the feature itself, it will be titled Best-Self Review, and will provide more context to the various stakeholders using it — to the employee, we will explain that these Review cycles (which start with setting clear growth intentions as well as Personal Development OKRs alongside their business-focused OKRs) are designed to help give them the ongoing reflection necessary to continue to learn, grow, evolve and become their Best Self. For managers, it will give them the context that their role as a manager is to help bring out the best in their people, which in turn leads to high performance, and that the reflection they’re providing is for that purpose. And for peers who will eventually participate in the 360 component of this, we will give context that the purpose of these 360s is so that we can all be conspiring for each other’s greatness.
I know there have been some concerns about the name “Best-Self”. Is it not professional? Will people be turned off by it? Is it not clear what it means?
While it’s true it’s not (yet) widely used in business, I think it’s a very important concept that people can easily “get.” In addition, there actually already is some great research and usage of the term in highly-regarded professional circles.
Two that I’ll point out are first, the Reflected Best Self Exercise, put out by University of Michigan’s Center for Positive Organizations (an organization that we closely align with philosophically). This process is advocated by esteemed Wharton professor and TED speaker Adam Grant, who recently co-authored Option B with Sheryl Sandberg. Harvard Business Review has also written about it using the “best self” language. Second, Harvard Business School, in collaboration with a professor from University of Michigan’s Center for Positive Organizations, wrote a paper titled How Best-Self Activation Influences Emotions, Physiology and Employment Relationships, concluding that “best-self activation inspired improvements in people’s emotions, resistance to disease, resilience to stress and burnout, creative problem solving, performance under pressure, and relationships with their employer.”
Ultimately, I think that this language points clearly and directly to the entire purpose and intention of our WHY and our Vision. Rather than using something that’s slightly more abstract, metaphorical, toned down, or slightly removed, this allows us to take a clear stand for why we’re here and what we believe. I believe that any initial discomfort someone might experience coming across this new languaging will quickly subside and become “normal” in the face of the power and effectiveness of what we’re building.
I believe that releasing the Best-Self Review will mark a key inflection point in our company’s history, and that we have some great days ahead. Thank you all for making this company what it is today, and for signing up on this journey to becoming your own Best Selves. I attribute much of our success, and the fact that we’ve been able to be so incredibly effective and capital efficient with such a relatively small team to that commitment we all share to our own growth, development and becoming our best selves. I also firmly believe we’re building a model for business that will increasingly be seen as remarkable and one to mimic the more successful we become.
CEO at 15Five
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David Hassell is Cofounder & CEO of 15Five, employee engagement and performance software that helps create high performing teams by combining continuous feedback, pulse surveys, objectives (OKRs), peer recognition, and 1-on-1 meeting agendas, all in one lightweight weekly check-in. Follow David on Twitter @dhassell.
Image Credit: Loren Javier
The world of performance management was irrevocably shaken in July of 2015 when Accenture announced that it would abolish their annual...Read More