In part two, we discussed the idea of allowing employees to manage their own workday and how and where they get their work done. The next area of opportunity is the performance review system, especially the structures that stack rank, fit employees into a curve, or even give a performance rating at all. Many companies have begun to change the way they review employees, opting to scrap the whole process and to focus more on providing continuous feedback and development all throughout the year.
Stack ranking, curve-forcing, attaching a performance rating … these things tend to create situations where managers had to play the game of how to fit all the employees into a very small box, and when employees questioned why they got a certain rating, managers couldn’t give them a straight answer that made any sense. It’s hard to continue to tow the company line when you agree with the employee on their performance, but can’t give them the rating they deserve because of the idea of a curve.
Another problem that tended to happen is employees didn’t receive the development and feedback as often as they should have. A lot of managers would wait until the yearly review to have the conversation instead of taking a more proactive approach.
The problem with the system likely began when companies thought about how they would be paying employees and what the budget would be. From there, it seemed they would then create a performance review process that may have supported this, but it was a backward approach because we weren’t putting the employee first, in fact, we weren’t really putting the company first. You may be wondering how that approach wouldn’t be putting the company first. It’s simple: the answer is the employees are the company. Without them, there is no company. The whole idea is that companies want to pay their employees for performance and didn’t realize that they could still do so even without a rating system.
When employee performance is personalized for each person versus being compared to others in the organization, it becomes a more rich process because it’s personal and tailored to them. However, revamping a performance review process to better meet the needs of the employees and the company is not something to be taken lightly as it takes work. A lot of work. There’s also not a one size fits all approach because each company is different.
When a performance program is done right, it can create an environment where employees actually want to do their best and work hard every single day instead of worrying about where they might fit in a forced distribution and who they’re competing with. It’s just one more way we could be treating employees outside the box.