Ways We Work: So long, yesteryear’s performance reviews

by Craig Bryant

Craig Bryant, Founder and CEO of Kin, and Emily Powers, Director of Operations and Finance at Fresh Tilled Soil, have joined forces to uncover the mysteries of the modern workplace. The following is the sixth chapter of an eight-part series featuring some of the greatest debates, struggles, and solutions surrounding how we work. Check out the entire series here.

The realization that happy employees are more productive has its roots in the early American industrial era of the 1900’s. Around the time when monotonous factory lines and substandard work conditions birthed workers’ unions, employers started to understand that maybe, just maybe, treating employees well might actually be good for business too.

Fast forward ninety or so years. Companies of all sizes have departments devoted to employee operations and engagement. There’s a multi­billion dollar HR technology industry helping employers stay competitive and engaged with their global workforce. Yet here we are, working in a time where 80% of polled workers don’t see the value in their performance reviews. So what gives?

How we got to “blah”

An employee review itself doesn’t create employee satisfaction, there’s much more to employee engagement than the occasional block of time spent discussing the topic with managers. However, used ineffectively, the employee review process can have the opposite of the intended effect by reducing positive sentiment toward someone’s job. The most common way to do that is with the traditional, annual performance review.

Meeting once a year with an employee to discuss an entire year of work is a burden for managers and an ineffective manner of keeping employees in tune with the needs of their company. Organizations make matters worse by scheduling their reviews during the most emotionally taxing time of year, the winter holiday season. To boot, they also lump compensation reviews into the same talk.

Likewise, the corporate feedback cycle has taken too long to adapt to the more frequent, informal check-ins that have proven highly effective in recent years. As Emily Powers wrote in her last piece, employers are learning that the Millennial workforce needs constant support and feedback to stay productive. It’s not enough to get together once a quarter… jobs can change on a dime, and so can employee sentiment. Feedback shouldn’t wait.

So, death to the employee review? Not quite. The employee feedback cycle is a business critical tool both sides of the table need to be successful. Unfortunately for the time-crunched however, an effective feedback process is not a single event jammed into the end of the year before heading off for a snowboarding trip.

Getting to “ah ha”

The right mix of feedback is different for every company, but there are commonalities at all organizations that will help dial in the recipe to keep effective communication flowing, starting with timing.

Cadence, tact, and timing

From business performance discussions down to everyday team member chats, continuous communication is mission critical. I can also personally attest to the fact though, that dropping in on an employee unannounced, what one former coworker referred to as “a managerial drive–by”, can be ruinous to focus and productivity. Organizations need to skirt the line between too much and too little ­- aiming for interactions that are valuable and genuine. Our (distributed) company does formal, quarterly reviews, coupled with more casual, albeit explicit, check­ins. In tandem with our daily team scrums and regular project communications, we get enough signals from everyone to keep the ship moving forward without being overly burdensome.

Iterate to better feedback

The feedback cycle needs to adapt to how people and organizations inevitably change. Similar to how we evolve our software products based on customer insights, being iterative with the employee feedback experience helps improve its effectiveness. That means companies should gather feedback on the review process, like perceived value and suggestions for improvement, and incorporate it into what is an essential workplace product.

Take money out of the equation

Most people are uncomfortable talking about money, and they’re equally as poor at estimating their monetary value at a company. Transparent pay scales, like the one used at Buffer, help companies turn the emotional topic of compensation into a more objective concept for employees. It also helps to keep financial discussions out of the more regular employee reviews that should be focused on individual progress and objectives. Admittedly, making everyone’s compensation public knowledge is pretty progressive, so companies that aren’t comfortable going that far can at least schedule compensation discussions independent of other reviews, such as on employment anniversaries.

Managing is a job, not just a responsibility

Managers shouldn’t be spread too thin. The right number of direct reports helps ensure managers have enough time for the time­ consuming, but incredibly valuable job of mentoring employees. While some people and roles require more attention than others, a common guideline is to limit the number of direct reports to seven.

Feedback is a two-­way street

We work in a multi­dimensional world, and basing an employee’s future on a one­way source of feedback is inherently one ­dimensional. Many employees fail not because of their own shortcomings, rather due to those of a peer, manager, or the company owners. Opening the feedback cycle to flow outward from employees requires more time, maturity, and transparency, but ultimately it delivers the knowledge the entire organization needs to genuinely improve.

Computers don’t give pats on the back

No amount of wonderful technology will ever replace the simple gesture of reaching out, saying hello, and asking how someone is doing. Technology should improve the feedback experience by organizing it, but it will never replace the genuine value of human interaction.

Employee goals are the company’s goals

A major contributor to an employee’s fulfillment is understanding how their contributions affect the overall performance of the company. Using tools like OKR‘s is a powerful way to align everyone’s sense of mission with that of the company. It also makes more clear work of review meetings themselves ­when objectives become the primary agenda for discussion.

It’s not always up to the employer

Employers can help employees be the best they can be at work but it’s not always possible (or ethical) to help them be happy outside of work. Geographic location, relationships, and other aspects of an employee’s private life are all beyond the traditional reach of an employer, but that doesn’t mean they don’t affect an employee’s performance at work. In a blog post about about my own company’s journey to becoming a distributed team, I shared the fact that one way we realized we could facilitate fulfillment outside of work was to enable our team to work and live wherever they’re happiest. Other examples of how a company might express the importance of non-­work life is ensuring through ample (and required!) time off, wellness programs and stipends, and supporting local civic events and organizations.

Communicate or detonate

A company’s employee feedback process is like a city’s transit infrastructure. At its best, it delivers people on time to do their jobs and helps them lead fulfilling lives. At its worst, it’s mired in potholes and congestion. Unlike municipal transit infrastructure though (at least in the US), the way we’ve worked has changed dramatically in recent years and there’s no reason workplace feedback cycles shouldn’t keep pace. By diverging from the traditional script of performance reviews, employers are taking a step toward a workplace where eyes and ears are the tools, open and ready for a conversation at any time.

About Fresh Tilled Soil

Fresh Tilled Soil is a Boston-based user interface and experience design firm focused on human centered digital design