Thursday, June 30, 2011

Employee Performance - No Surprises

August is our annual performance review month.  I thought this would be a good time to share some of my thoughts on the process of reviewing performance.

I will start with a story....
A manager sits down with an employee for their annual performance review.  The two have met one-on-one every two to three weeks for 30 minutes throughout the year.  The recurring meeting was set up by the manager with all of her direct reports.  The conversations in the one-on-one meetings have been pretty benign with nothing significant resulting from them.  All appears good.

The review starts out as most do with sharing of pleasantry’s (how's the family, how was your weekend, etc.) and idle chit-chat.  After a few minutes they get around to the task at hand - the performance review.  If this were a movie, this is where the dramatic music starts and the dark storm clouds move in.  The hammer is about to come down and the employee has no idea it is coming.  It turns out that his performance has been poor and he is being terminated.  Total shock.  He is feeling ill as his manager goes through the list of is long.  As his manager rambles on, she starts to sound like Charlie Brown's teacher, the words no longer make sense and the shock has put his mind into some other place.  It is a surreal moment for the employee.

What's the problem?
If the story is not ringing any alarm bells for you, I hope you are not a manager.  No employee should walk into an annual review and be surprised, let alone terminated.  Those bi/tri-weekly meetings the manager had are re-calibration opportunities to keep performance on track before it becomes a problem.  Your job as a manager is to lead, motivate, coach, and address problems when they occur, to optimize employee performance, and to always have your team know where they stand.  Think about it this way - if you have a flat tire are you going to wait 6 months to fix it?  Of course not.  You might even go to to buy a new set of rubber for your vehicle.  Why should you operate differently at work?

The annual ritual
The annual ritual that companies go through to provide feedback is outdated and quite simply a waste of time in its current form.  The intentions are noble - make sure everyone knows where they stand, review accomplishments, talk about career development, alignment with business goals and values, etc.  The problem is that the results often times look more like a tee-ball tournament where everyone gets a trophy than a constructive session that provides real, honest feedback.  Why is that?

Nobody likes conflict.  (Ok, most of us don't like conflict.  There are a few of you who relish in it.)  It is much easier to put a positive spin on things than to provide negative feedback.  Give everyone a passing grade along with the blended merit increase.  C'mon, our employees deserve better than that.  Your company deserves better than that.  Honest feedback when negative can be hard to do, but necessary. 

Don't get me wrong, reviews are important.  But they have to be genuine and timely.  Waiting until the end of the year to tell someone they have made a mess of things is bad management and unfair to the employee.  What in the world can anyone do about an issue from six months ago?  More often than not, you forget and it is never addressed or corrected. 

When you sit down at the end of the year, nobody should ever be surprised when they hear that they are doing a good job or a bad job.  The only reason for surprise should be that they were not listening.

My recommendation:
- Provide regular, immediate feedback - both positive and negative.
- Be specific, constructive, tactful, and honest.
- Stick to the facts and leave out the emotion.
- Negative feedback is an opportunity to correct an issue.  Don't be afraid of it. 
- No surprises.  Everyone should know where they stand - always.

The annual performance review should be a summary of what both you and your employee already know.  It should be a very quick conversation about the past (the known) and focus more on the future (the unknown).

Remember:  Work is not like tee-ball.  People don't get a trophy just for showing up.

1 comment:

  1. Yes, but there's a flip-side to the relationship. The once-per-year review was tied, perhaps incorrectly, to the once-per-year salary adjustment. This is bad, in that most employees would be fixated on "the number" that was either first announced (which means the employee zones out on all the review stuff) or is to come (which means the employee skims over all the review stuff to get to The Number as quickly as possible).

    Removing the annual review also removes the annual wage adjustment.

    Now while you can make arguments that if an employee wants more money they should be the ones to initiate the discussion -- and there are good arguments in that favor -- remember that due to inflation, every year an employee doesn't get a raise is effectively a reduction in compensation.

    As in, by default, your compensation is reduced. After a year of bi- or tri-weekly meetings full of achieving goals, mapping out personal development, and adding value to the company, your salary is being reduced.

    Pitching the annual review is probably good as far as managing your employee's growth and achievement is concerned, but it sucks for managing their compensation.