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Performance Reviews Still Stink!

Friday, February 24, 2012 by Slaughter Development

Every employee dreads the performance review, and research shows they are a waste of time. A new Wall Street Journal piece notes they may finally be losing steam.

According to journalist Rachel Emma Silverman, there are some serious issues with the practice:

Performance reviews have long received poor grades, even from those who conduct them. Nearly 60% of human-resources executives graded their own performance-management systems a C or below, according to a 2010 survey by Sibson Consulting Inc. and WorldatWork, a professional association. And one academic review of more than 600 employee-feedback studies found that two-thirds of appraisals had zero or even negative effects on employee performance after the feedback was given.

For many years here at The Methodology Blog, we’ve been documenting the problems with performance reviews for ages. It’s pretty easy to understand the major flaws:

  • Focuses on evaluating the past, which cannot be changed
  • Forces totally different people to be compared on the same scale
  • Creates adversarial relationships, especially about pay raises
  • Ignores essential team dynamics
And more! Check out the top fifty problems with performance reviews.

One comment attached to the WSJ article points out the only “benefit” among all the problems with performance reviews:

If the company has already decided to get rid of you, they give you a review that basically amounts to “does not meet expectations” and you get put on a “performance improvement plan.” The reality is that no one ever survives this process-the decision has already been made-there is no hope of recovery. So, you get 6 months to a year to find another job or at least plan how to budget your unemployment.

Otherwise, you would get no warning at all.

Of course, most employees are not in the position to eliminate performance reviews. And even for managers and owners, blindly cutting these practices is not enough. Instead, employers must work to instill a culture of continuous improvement and honest conversations. As the article states:

“When feedback is”not going to be used to judge you or your fate in the company, you are more likely to be open about where you need to grow and it’s going to be far more effective.”

Candid discussions are central to any healthy relationship. If we truly want to achieve more at work, we must learn to be forthright and upfront with our colleagues.

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Like this post? Here are some related entries from The Methodology Blog you might enjoy:

Death to Performance Reviews - Dr. Samuel Culbert, a leading business professor from UCLA, hates performance reviews. “To my way of thinking,” he asserts, “a one-side-accountable, boss-administered review is little more than a dysfunctional pretense [to preserve authority].” Read on »
Why Great Employees Leave Big Firms - Employee retention is crucial to maximizing productivity. So why do the biggest companies fail to retain their best employees? Read on »
No Review; Plan And Do - Robby Slaughter, founder of Slaughter Development, recently addressed a dilemma posed in the B2B Social Media Digest regarding performance reviews. His suggestion: “We don’t need to review, we need to plan and do.” Read on »
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6 Responses to “Performance Reviews Still Stink!”

  1. Bryan Hart Says:

    I have a friend who works for a company that just got new management. The brilliant idea is to do regular/frequent reviews of the employees. They are based on the speed in which the tasks are performed. Each time the review comes in the top 5 are given encouragement and the bottom few are reprimanded.

    A great system, don’t you think? Each time the team is reviewed there will always be reprimands–regardless how much improvement has happened! (Though how true improvement can happen in such an environment)

  2. Robby Slaughter Says:

    Thanks for the comments, Bryan!

    Reminds me of the old adage from Jack Welch at GE: “Every year, you should fire the bottom 5% of workers.”

    Really, Jack? Maybe you ought to improve your interview process so that you don’t hire them in the first place!

  3. Proforma Distinctive Marketing Says:

    Before starting Proforma Distinctive Marketing I never once had a productive performance review. I am going to go out on a limb…I would say that 80% of performance reviews are not useful and only hurt moral and future productivity. I feel you can apply the 80/20 to EVERYTHING!

  4. Morgan Norman Says:

    Great insight on the problem with performance reviews. There’s an obvious disconnect between the manager, who will usually look at an employees performance through a standard rubric, and the employee, who usually has to wait around for the right sort of feedback. If the manager isn’t rating the employee on the right levels and the employee has no idea if they are doing their job right, it’s a serious problem for the team and the organization.

    Instead, feedback should happen in real-time and performance and goals should be more social. If everyone is kept up to date and engaged on the overall objectives of the team, the traditional performance review is unnecessary since both the employee and the manager are continuously engaged in the right way.

  5. Robby Slaughter Says:

    Great comments, everyone!

    I agree with PDM that the 80/20 rule applies. And the 20% of “performance reviews” that are productive sound like what Morgan is discussing: real-time feedback instead of saving everything for the entire review.

  6. Linda Says:

    I totally agree, there are fundamental issues with the traditional approach to performance reviews. Times, work and employees have changed and it is about time to evolve form the carrot and stick model.

    Continuous timely feedback, agile objectives tracking and 1 on 1 meetings encourage engagement and real performance improvement. If this ongoing communication is captured for reference, then all you need is a ‘performance check in’ meeting every quarter or 6 months to establish trends and simply review the past to concentrate on future improvements.

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