Chapter 2

A broken process with 6 distinct problems

Here are the 6 most pernicious problems of performance reviews, based on research from the last decade.

From all the research and literature written on performance reviews in the last decade, six consistent problems appear in traditional performance reviews…

#1: “So, what’s this really for?”

Performance reviews try to do too many things at once. Many teams will use performance reviews to do some mix of the following:

  • offering advice on how to improve
  • setting an employee’s bonus or raise
  • deciding on a promotion
  • justifying a future firing

Unfortunately, this diluted focus leads to the performance review not being able to do any of these things well.

#2: “Are you judging me, or coaching me?”

Most performance reviews are tied to compensation and/or ratings. In our survey, we found that 63% of 1,087 people surveyed said that their performance reviews were tied to compensation. While popular, this backfires. This means the minute you try to offer feedback during a review, the person on the other side is bracing themselves for whether they got a raise or got promoted… not, “Oh, is this feedback I should internalize in some way.” In fact, studies show how rankings trigger a fight-or-flight response in the brain. When performance reviews conflate growth with judgment, it damages the likelihood of growth.

#3: “I don’t want to say anything bad.”

We fear that what we write in our performance reviews might negatively affect ourselves — or someone else. We keep our feedback surface-level and vague, rather than meaningful and specific. Poor delivery by the manager and/or the organization often leads to botched performance reviews. Managers haven’t been trained to give effective feedback. HR managers believe 8 in 10 managers have skill gaps in giving feedback and coaching, and only 14.5% of managers strongly agree that they are effective at giving feedback.

#4: “I’ll wait to bring this up in the next review cycle.”

We sit on feedback until the performance review cycle happens, enabling feedback to inevitably build up. We surprise our team if and when it does come out in the end — and not in a good way. This means the feedback that’s given is imprecise and/or too late to truly matter, as it’s been built up over the past year. Or, the feedback has been completely absent and hits the other person like water from a firehose: In fact, in many organizations, it’s “the only time where they can force managers to give feedback.”

#5: “I have to triangulate and summarize 3+ people’s perspectives.”

Performance reviews are not a direct, frank conversation. They are a telephone game of “he said she said,” leaving us confused on what exactly we need to improve. Rarely do performance reviews feel fair or accurate. Tellingly, according to Gallup, only 29% of employees strongly agree that the performance reviews they receive are fair, and 26% strongly agree that they are accurate.

#6: “Sheesh, this takes forever.”

In a study by the advisory service CEB, the average manager reported spending about 210 hours — which is close to five weeks of doing performance reviews per year. In our survey, most people reported that their performance review takes more than two weeks to implement, with 66% of managers spending 4 hours or more to complete them — with 13% spending 12+ hours. That’s longer than some projects themselves. One could only wonder how much energy could be directed toward the work itself with that amount of sheer effort and time.

If we want to have better performance reviews, first and foremost, we’ll need to solve these 6 underlying problems.

Curious how other organizations have tried to solve these problems? Read on in Chapter 3.

Chapter 3: Attempts at rethinking reviews →

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