Performance Reviews a proposal!

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))