Get Rid of Performance Reviews? Sure, But What Do You Replace Them With?

Editor’s Note: Sometimes, readers ask about past TLNT articles they may have missed. That’s why on Fridays we republish a Classic TLNT post some of you have asked about.

Like many of my fellow HR professionals, I’ve had my fair share of time dealing with the headaches from performance reviews.

Whether it is a supervisor who simply doesn’t want to do them or an employee who thinks they were unfairly evaluated, sometimes it feels like an anchor on your other activities.

And I guess I wouldn’t mind it that much if performance reviews always turned out great. The problem is that they don’t. Even the best-designed plans don’t always do the trick. And saying that most employers have the best-designed plans? That’s probably just a bit of a stretch.

The real problem is that if we are going to get rid of performance reviews, what do we replace them with?

Are Performance Reviews working?

What got me thinking about this was an article in The New York Times about the fairness of bosses when it comes to managing performance:

As anybody who has ever worked in any institution — private or public — knows, one of the primary ways employee effectiveness is judged is the performance review. And nothing could be less fair than that.

In my years studying such reviews, I’ve learned that they are subjective evaluations that measure how “comfortable” a boss is with an employee, not how much an employee contributes to overall results. They are an intimidating tool that makes employees too scared to speak their minds, lest their criticism come back to haunt them in their annual evaluations. They almost guarantee that the owners — whether they be taxpayers or shareholders — will get less bang for their buck.”

The author of that is Samuel A. Culbert, a professor of management at UCLA. He isn’t a fan of performance reviews as they exist now.  He even wrote an entire book about it too, which merits its own discussion entirely.

So where do we go if Performance Reviews suck?

And that’s all well and good, but how do you evaluate employees then? How do you determine who is doing well, who needs to move up, and who needs to move out? After all, Kevin Elkenberry and Guy Harris laid out a pretty compelling piece on how to perfect performance reviews on TLNT, but the reason why articles like these still exist is because hardly anyone follows them. Time after time, we’ve known best practices in performance reviews and simply haven’t followed them.

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Then up popped a post from Ed Newman of Accidental Entrepreneur that got me thinking about what could change and still have some sort of method in effect. He writes:

As a business owner I knew that managing performance had absolutely nothing to do with annual performance reviews. It is all about being in alignment regarding expectations and then empowering people to do their jobs. But as my business grew to the point where I was no longer the only manager, how could I ensure all of the others have set the right expectations with their employees?

My knee jerk response was to implement traditional performance management process so that I could see the evidence that performance discussions were taking place. But guess what? This wasn’t managing performance at all – it was simply documenting what happened last year.

Newman points to a company called TalentSphere that understands this concept. There are also companies such as Rypple and Sonar6 that are approaching the idea of performance reviews differently as well.

Is software the solution?

The question I have with these sorts of things is whether software is really going to fix the issue. That’s especially true in the scheme of changing a culture, where everything is based on a yearly performance review, to something more effective. Isn’t implementing software a waste of time and money until company leaders think of performance differently?

While current performance reviews lack the nuance and timing that they should, they were dead-on simple to implement across a large organization. The alternative with constant feedback loops, goals, and expectation setting is better management training. And if that were as easy as saying it, the major issues that impact the workplace because of poor management behavior would become a rarity.

So if we get rid of performance reviews, what are we going to do instead? And how would we go about implementing that sort of wide-ranging program (especially if you’re currently having issues dealing with regular performance review headaches)?

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