Performance Reviews Stink

On NPR, Samuel Culbert, a UCLA business professor, boldly declared that performance reviews tend to be “total baloney.” He asserted that performance reviews improve neither the company nor the boss. [Listen to the piece on the NPR website.]

Traditional performance reviews foster intimidation without prompting honest feedback and collaboration for development. Performance reviews put a lot on the line for the employee: promotions, pay raises, and career development plans. With a lot at stake, the performance review is frustrating for employees who are forced to inflate their achievements and dwell on their successes. It’s a charade. And management plays the same game. Culbert says: “The boss already has heard [from] his boss what they want to pay…So they come up with a review that’s all backwards.”
The performance review system requires extensive financial and human capital investment, often yielding a negative return. A one-time performance review event stifles development and causes more problems than improvements. In order to get a positive return on the performance review investment, the event must be approached in a new way. The event must become a process.
We’ve found that the best companies use multiple measurements like 360-degree feedback and employee survey results as part of their performance management process. Use of this data facilitates a well-rounded and genuine process centered around real, actionable feedback. This process is entirely different than an event.
With relevant and actionable feedback, companies can analyze not only what gets done, but also how it gets done. The engagement surveys generate information about the level of motivation, satisfaction, and effectiveness. These measurements are developmentally focused and cater to a performance management process, not a one-time charade.
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