WHY PERFORMANCE REVIEWS DON’T WORK
August 4, 2014 6 Comments
“An ounce of performance is worth pounds of promises.”
American actress and sex symbol Mae West (1893-1980)
I was recently involved in sitting in with a Regional Head while he reviewed his direct reports, just so I could get an understanding of how he interacted with his people. As I had just embarked on an executive coaching programme with him (at the request of his CEO), I was keen to see how he would handle these quarterly sessions, as I have long been against the whole idea of formal performance reviews, no matter how regularly they are planned.
I have long believed that the holding of formal performance reviews does little to actually manage performance, and flies against my strong belief that managers need to manage behaviour rather than manage people (see “People performance pitfalls” posted October 28, 2013)
These particular performance review sessions only reinforced my beliefs, and here are some of the reasons why:
– Neither side was particularly well prepared … I was surprised at how little preparation had been done on either side in readiness for these sessions, apart from some hastily scribbled bullet points, and could only surmise that this was because no-one treated them with a great deal of seriousness, which begged the question as to why they did them at all. The lack of preparation was actually mentioned by nearly all of them, and justified and forgiven because of the “pressures of work” taking priority. If you must do these formal reviews, then serious, studied and thoughtful preparation is key. When I had no choice but to do these, I found that a standard format worked well, and I mostly used the simple one of … Here are the things that I want you to do more of, do less of, stop doing and start doing.
– They tended to discuss business issues rather than how the subordinate was actually addressing them … The major part of the sessions tended to be informal discussions on what was happening in their marketplace, their competition and the global economy rather than how the direct report was performing against specific goals that had been set by their CEO, and cascaded down by the Regional Head, and that were actually documented in the strategic plan, of which I had been given a copy. Executives can chat about these topics whenever they want to do so over a coffee or a cocktail, but a performance review should be about discussing how a person is coping with the tasks that they have been assigned, and what is needed to sustain or improve the situation, and not be just an information sharing session.
– They spent the major part of the actual review time discussing financial performance … I have yet to meet a surviving executive that comes into any review session without a clear understanding of what are his numbers and his performance against them at that time. This means that spending most of any real review discussion on an analysis of the numbers is the wrong focus. Discussing how the numbers can be improved makes sense, but for example beyond saying “watch your spending”, going through a fine tooth-analysis of why marketing expense is 7% over budget for the quarter is a distraction rather than a benefit to the business. If something doesn’t look good, the only valid question is “What are you doing about it ?”.
– The only time people issues were discussed was with the HR Director … I was surprised at how little discussion was given to people issues, particularly as I believe that people are the only true long-term sustainable competitive advantage. There was a long discussion with the HR Director about attrition, recruitment, engagement, succession and other related HR “issues de jour”, yet strangely none of these topics had been discussed with the line managers. What I also found fascinating was that there was no discussion at all with the HR Head as to his personal actual performance and what benefit HR brought to the business, only about the HR metrics on their dashboard. I felt like standing up and yelling “It’s all about people stupid” but held my tongue and wondered about whether I may have accepted a coaching task equivalent to Hercules having to clean out the stables of Augeas. The reality is that there are no HR problems, there are only business problems, and discussions about people are at the core of performance management in every division and at every level of the business for every executive.
– There were no references back to previous reviews … Interestingly, this company has a highly developed (if somewhat cumbersome) on-line performance management tool, but this was not referred to at any time by either of the parties, and the only recording that was done was some regular scribbling on pads and notebooks that seemed to be ubiquitous in this management team. The whole process to me seemed along schoolboy lines of “Johnny you are trying hard, but I want you to do better”. There is no point in doing any sort of review if one cannot look at a starting reference point and what actions were agreed in the last session. The objective should at the least be to see whether behaviour is changing in a way that will help to meet the objectives. I am not suggesting that the focus should be only historical, as it should rather be on future behaviour, but it is important that one can see whether you are actually making some headway.
– There was no feedback to the boss’s own performance requested, nor given … There was not even a question asked such as “what can I do to help you or to make things better ?”. I believe that any review session has to be bi-directional to be at all worthwhile, as no one does it alone, and the person at the top has the responsibility for the conditions and culture that those below have to work within.
It is worthwhile remembering the words of American statesman and retired 4-star general Colin Powell “Organisation doesn’t really accomplish anything. Plans don’t accomplish anything either. Theories of management don’t much matter. Endeavours succeed or fail because of the people involved.”