Towards the end of each year and start of the next many people in “serious businesses'” seem to have to suffer the torture that is the annual performance review. Not having to deal with this ridiculous set of processes this year has not kept me away from it. I still see the unfortunate side effects that the various systems used have on people, their morale and their sense of belonging to an organization.
What tends to happen in most large companies is that they have decided that everyone should be measured against some set of targets. (That sort of makes sense). They then decide that clearly some people will be better at things that others. (Another correct assumption). They then decide that a bell curve should be applied to the performance of people. i.e. lots in the middle of the road and some great people at one end and no so great at the other. (This also makes some sense).
Then the logic goes out of the window in favour of process.
The bell curve is not applies across the entire population at once. Instead it is broken up into bell curve copies with equal weighting and applied to nominal collections of individuals, such as a department. As each department and individuals actual objectives are probably different the relative performance and the bell curve are in effect blown to pieces, like for like is not easily applied.
Various groups of individuals may have champions in the political systems who fight for a greater share of the bell curve, but many will instead try and fit the bell curve onto their people then attempt to justify their decisions.
A whole heap of time and money is wasted in many large corporations in order to ensure that the status quo is maintained.
I have experience all ends of the spectrum in these evaluations. If you get an outstanding result you feel great, but also slightly guilty. Very few people will take people to the pub to celebrate their “outstanding” performance rating.
Those that get the next level down (typically there are only 4 or 5 ratings) feel sort of happy, but annoyed at being so close yet so far form being told they are great.
The next rating is really “yep you are just about doing you job” thanks very much for that!
The other ratings are typically supposed to be a wake up call of some sort, or a threat, or “well its just your turn”. The slightest reason can be used to reduce someone to a low performer. I have heard and experienced enough aberrations in the process such as the particular dichotomy of receiving some of these ratings dressed up as business but knowing they were personal and possibly bullying, to know that the systems used are damaging in so many ways.
So what does a company achieve by attempting to centralise and control the distribution of performance?
Well they force most people to be mediocre, and hence the company to be mediocre.
Once thing social media has taught us is that even the most mediocre employee in a company can have a huge impact on the direction of the business. So surely it is time for the HR departments to find some innovation somewhere?
This is not to hide from competition and merit, but to actually put that back onto a footing where it means something.
I have to consider these things even more deeply in how the companies I am helping create, that I work with and possibly for deal with people.
You didn’t need to be reminded of this, did you? Deming told us this 40 years ago.
Deming said that performance generally fell into 3 areas:
The top 10%. Always at the top. They’re noticeably different. Learn from them
The middle 80%. Sometimes perform better than others, due to natural variation. Support them
The bottom 10%. Always at the bottom. Teach them or move them to a different job where they can do better.
Everyone knows the top 10%. Their peers recognise them as such. We also know who’s in the bottom 10% — ditto. For the rest of us, sometimes we do great, sometimes we don’t quite, but we’re there or thereabouts depending on things like whether we get the contract or the customer likes us that day.
It’s not actually that difficult. The problem comes where companies insist on measuring things that can’t be measured in order to apply a veneer of objectivity onto a subjective process (something I’ve said to many managers without them denying it). Why would they need to do that? Perhaps because otherwise they’d be sued and not have the numeric evidence to back up whatever decisions they took on the results of their assessments.
Which is where other Deming ideas come into play. Things like “drive out fear”, and the need for trust between management and workers. Perhaps it’s all too late for such things, in a culture where even acceptable performers are being made redundant because they’re too far down the bellcurve (this year).
Will things change? I can’t see it. We live with it, or move elsewhere. Or start our own business. But companies certainly suffer terribly as a result of their application of flawed principles to the measurement of staff performance.
Yes, the curve itself against 1 parameter or a collection of similar ones makes sense. Give a bunch of racing drivers the same car and a few will be great. Play tennis and a Federer will emerge. As you quite rightly say though the veneer of objectivity on the subjective, and not using like for like breaks the process.
I don’t think it is too late for many companies to change. Whilst at the moment they may be looking for excuses to resource action, down size, force people to pension themselves off if they continue on this path they will loose. They will loose people, the good ones, they will loose money due to enforcing a set of HR systems that cost money for a negative effect and they will loose customers who increasingly get to engage with the spirit of the company.
As per the BBC Virtual Revolution in my previous post, the great leveller of the web and the communication and transparency it engenders will force change in such outmoded practice.
These are constructs of humans, hence they can be changed for the better, and as has happened at the moment for the worse.
Everyone is talking about the ‘creative economy’and the need for innovation. Performance reviews are based on the ‘average’, eg the lowest common denominator that is acceptable…i.e. performs to an acceptable average…consistently performs above average….performs to a high standard & consistently exceeds expectations. In most art colleges they have done away with an hierarchical grading system because it did not encourage creativity and in fact could damage self-esteem. It is replaced with an assessment of what is produced and of course if you don’t produce something, you fail. Big companies should take a leaf out of their book. As you said the grading is subjective anyway.