Gosh it’s nice to have a job that doesn’t require writing performance reviews, but I still have friends who encounter them on a regular basis. This is a problem sort of like taxes and in desperate need of reform. The original idea was some what sound, though you might argue it was tied to bureaucracy — the requirement that you needed to justify why X got a 8% raise and you only got a 5% raise.
What we all know is that performance reviews and raises are fundamentally disconnected, typically done in a revisionist history that causes the performance review to be written to match the raise that was already in progress.
So, how to fix it…
- Everybody gets a basic raise of X% – why not
- Make sure you reserve a pool of $$ and give top performers Y%
Wait, that’s not new… It’s the data collection that’s new, not the money.
First Step – Instead of the onerious process of doing these huge formal performance reviews, which require at least a day of training to even fill out. Go back to school and have a simple 10 question form, with a rating from 1..5 and give that to employees on a quarterly basis.
- Forces a regular feedback cycle with your employees
- Should be able to be done in 5 minutes for each employee
- Now it’s quarterly
- No written feedback
- Managers who give everybody an A+ or employees who expect it
Second Step – 360 degree feedback – via prediction markets. What? Ok, instead of again foisting an annual review process on people (ok, co-workers). Set up a system that randomly polls your co-workers (or customers) about your performance. Ask them 5 questions again on a 1..5 scale. Sample questions:
- Is John making his commitments?
- Has John helped you get your job done regularly?
- Is John activly participating in design discussions?
- Is John spending too much time surfing the internet?
- Is John polite with customers on the phone?
Random things, maybe some organizational focused questions (sales vs. programmer). The core of the idea is that by polling your co-workers frequently you can see trends over time.
- Regular polling of your co-workers, yields consistent data.
- Simple and quick… no lengthy written docs
- Anonymous and random
- Co-workers who always answer “5” he’s the best
- Lack of participation
Final Thought – Now you’ve got a system in place that lowers the burden of long paperwork, provides regular feedback and some real metrics on which you can base the who gets the bounce $$$ or the promotion. This reduces the ability of a manager to make “perception” based arguments. Plus, it provides regular feedback cycles both the employee and the manager on your performance (how do people perceive (polls) me and how am I perceived from above (report cards))