Managers rate performance reviews right behind firing someone as their top two most disliked activities. How bizarre is that? Giving constructive feedback, mentoring, training, and improving the performance of their staff should be their number one motivation.
Staff members hate them, too. They dislike that managers delay and avoid performance reviews and feel they are paternalistic, controlling, and at odds with taking personal initiative and designing your future in a company.
The forms are also often considered a joke, rating people on such ambiguous things as “excellent performance,” “exhibits enthusiasm,” and “takes initiative.”
It makes no sense that a person’s compensation and future in a company can be tied so directly to an activity nobody wants to do. In the “participation age,” great companies are adopting systems such as peer recognition surveys.
Peers Get It Right More Often Than Managers
Who knows my performance best? My peers. When I was young, I worked in a situation with 10 people doing the same job. Four of us were extremely productive, another four were doing just fine, and two were holding the rest of us back.
We complained to the manager, but one of the two was the manager’s friend while the other one was family–so the manager had no motivation to fix the situation. I always felt that if the 10 of us were able to rate each other, those two slackers would have either been voted off the island immediately or, more likely, would have stepped up their game because they knew that even if they could fool their manager, they couldn’t fool their peers.
To solve this discrepancy, our company replaced reviews with bi-monthly peer recognition surveys. Each team designed its own survey based on our values, vision, mission, and the team’s process and required results. Every other month, everyone on the team gave an anonymous rating of themselves and everyone else on the team. Each team also rated the teams (not the individuals on those teams) that impact their work. We used those ratings for everything from adding responsibilities to training as well as paying out incentives. We emphasized “catching people doing something right,” which is not often the emphasis for feedback.
This may sound like a bridge too far for some companies, so here are three principles that you can use to design something more effective than annual reviews:
- Peer feedback: Per my shared personal experience, managers never know as much about how team members are performing–or how they could improve–as their peers do. One of our clients, Illuminate Education (IE), with 200 staff members has each team design their own reviews based on the values, vision, and mission of IE, including each team’s process and required results. Then each person picks three people in the company they feel know them the best and those peers complete the review. A team lead can still have input, but this peer-led review system has proven much more effective. The proof is in the pudding–IE is the #2 Best Place to Work on Glassdoor, and has exponentially lower staff turnover than other companies in their industry.
- Timely feedback: If you’re going to wait six to 12 months to give strategic, constructive feedback, don’t bother–it doesn’t work. Our surveys are bi-monthly and it’s hard enough to remember what went on over the last two months. Think about it: you’re telling me I need to take more initiative, be more decisive, or act more quickly, then you’re going to wait twelve more months to rate me on my response. The research shows this approach clearly doesn’t work.
- Specific feedback: This is where annual reviews fail most visibly and comically. Classic rating topics like “takes initiative” and “demonstrates a positive attitude” are absurdly broad, unhelpful ratings. Annual reviews also typically include fuzzy dialogue questions such as, “What do you think went well this year?” It’s understandable why we take such a broad, sweeping, and vague approach. We’re attempting the impossible–to review twelve months of productivity, teamwork, discretionary effort, growth, and initiative in one sweeping, ineffective motion.
So whatever approach you decide to replace current annual reviews with, make sure it includes timely feedback, specific feedback, and an overwhelming dose of peer participation.
By every measure, traditional reviews simply don’t work. Take the above three principles and let your teams design a better way to get feedback. Let’s re-humanize the workplace by giving everyone their brain back, and let staff review themselves. You’ll be surprised at the increased engagement, higher retention, and higher happiness scores. After all, peers know best how peers are doing, and can offer the best feedback and mentoring.
This article originally appeared on the Globoforce Blog.
Chuck Blakeman is a successful entrepreneur, best-selling business author, and world-renowned business advisor who built 10 businesses in seven industries on four continents, and now uses his experience to advise others. His company, Crankset Group, provides outcome-based mentoring and peer advisory for business leaders worldwide.
About Protocall Group
The Protocall Group, established in 1965, is a full service recruitment and staffing firm. As a full-service, family-owned and operated business, it has led regional industry in the Greater Philadelphia area and southern New Jersey to much acclaim. Recognized by NJ Biz, South Jersey Biz, and the Best Companies Groups as among the Best Places to Work, Protocall’s expert professionals connect exceptional associates with their client companies across a wide variety of fields. They also offer innovative solutions to employers that help them lower staffing costs while increasing productivity.