The Great Performance Evaluation Debate
Like a lot of others I was intrigued to read about Accenture’s decision to radically modify their approach to performance evaluation and eliminate such practices as forced ranking and the annual or semi- annual trip to the woodshed that both employee and manager dread.
That being said I think what I liked is that Accenture, and other progressive companies recognize, is that it is largely the execution of the process that fails IF you recognize that the primary purposes of performance evaluation should be to give employees feedback on things they are doing well and can improve on, and to provide some measure of objective information in making compensation decisions.
Employees need and require feedback. In fact a Saratoga Institute survey of 20,000 employees from multiple industries indicated that lack of meaningful feedback is the number 3 reason employees leave employers. Number 1 is a lousy boss (see a correlation), and number 2 being poor job fit.
There a literally hundreds of reasons we don’t give meaningful feedback, and as a human resources executive and management consultant I have heard most of them.
Giving feedback constructively is not a natural skill for most of us. Some of the biggest reasons include:
- Fear of hurting the recipient’s feelings
- Dislike potential confrontation and conflict
- Fear of losing control over our feelings and emotions
- No data (haven’t observed performance)
- Never got it yourself
- Haven’t been trained
- Not timely; it loses impact
- Culture doesn’t demand or reward it
It seems that many of us are still caught up in Frederick W. Taylor’s model that Leaders lead and employees do, so all that soft stuff like constructive feedback, corrective action, and coaching are for wimps.
I am still stunned by the number of organizations that don’t assess for emotional and social intelligence skills in addition to technical capabilities when hiring or promoting management or leadership talent. Remember my top three reasons employees leave!
Then in many cases we compound it with lack of training.
My former colleagues in Human Resources have unfortunately contributed over the years by designing systems that are easy to administer and are more about documenting process than modifying or reinforcing performance.
Constructive feedback isn’t code. It means the feedback is specific, measurable, job related, and timely. Semi -annual isn’t timely even if it meets the other criteria. Annual is an epic fail.
Corrective action isn’t a politically correct way to describe “discipline” or punitive action, or “building a case”. It means identifying behavior or performance that isn’t meeting expectations and figuring out why and fixing it. It could be unclear expectations, lack of training, conflicting priorities, or a host of others causes. It is first always diagnostic.
Coaching isn’t training. It is helping an employee increase capabilities or learn new areas by reinforcing strengths and aptitudes we see demonstrated.
Then there is the mess we call compensation delivery.
In my over thirty plus years as an HR and C level executive and consultant I see this crash so many times. Employees often take issue with their compensation and the way it is delivered because we provide no context or framework for how those decisions are made.
I have always embraced a pretty open model.
- These are the labor markets we compete in for talent.
- This is the position we choose to tale relative to that market; i.e. at market, leading, or behind.
- We use a salary benchmark. We track performance and pay to that benchmark and our goal is that people performing at that benchmark will be paid at that benchmark. Pay above that benchmark is reserved for outstanding performance in most cases.
- We don’t do “cost of living”, we pay to our market.
- Your pay and your performance relative to our benchmarks determine how big a raise you get or don’t get.
- Although we don’t “force rank” unless we are blowing our goals away everybody in the organization is not exceeding expectations. Our expectations are high; meeting expectations means solid performance not a “C” like school.
- While I hire and manage whole people your personal circumstances are not a factor in my decisions about compensation.
- Your compensation doesn’t reflect your value as a person; it reflects the market value of the rent I pay to have you provide your talents and abilities in my organization.
- I do compare people who do the same or similar jobs to each other considering their experience, capabilities, and performance in pay decisions.
There was an excellent post on Linked In today, https://www.linkedin.com/pulse/performance-evaluations-dont-help-your-workers-best-jacob-jaber, which does an excellent job of describing what good performance evaluation is intended to accomplish.
Accenture, Deloitte, and others who have “blown up” their performance evaluation systems haven’t lost track of that. They are experimenting with other models to address the flaws in our current systems.
They have not stopped giving feedback or tying compensation to performance so like them if you are looking to throw out your old system make sure you have a replacement……