The 2023 Performance Review Playbook

In this episode, we speak to HR leaders and create a playbook for seamless performance review cycles that will help organizations navigate the downturn—and set them up for success.
In this episode:
  • The unique challenges that impact performance reviews in 2023
  • The do’s and don’ts of performance reviews through downturns
  • Building an effective performance review playbook for people managers

About the speakers

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Hello. Hello, everyone.

And thanks for joining in today. I'm your host, GC, people science leader at mesh dot ai. Someone who considers himself extremely blessed to have worked with and learned from hundreds of people and culture leaders over the last decade and a half.

When it comes to solving for company performance through people practices, modern companies find themselves almost rebuilding the plane as they're flying in. With that said, the future is already here. It's just unequally distributed.

That's where the performance puzzle comes in. A show where people leaders from around the world volunteer their experiences and playbooks to help you navigate the intersection of people's strategy and business success.

Today's topic at hand is extremely interesting and polarizing at the same time. We are going to have to complete powerhouses of experts who have a deep passion and rich experience in leveraging performance reviews to drive both people as well as business growth.

Allow me to share a formal introduction to our two powerhouse expert speakers today.

We have Megan, who is currently the global head of culture, employee engagement, and employee listening at Western Digital.

In her past roles, she's led leadership development at electronic arts talent management and ODE at GE, as well as talent and performance management at Dropbox. Meghan brings with her a wealth of experience on delivering data driven people strategy that's deeply rooted in employee listening.

Danielal Saabot is the Chief People Officer at Embers, an organization that's mission is literally to humanize work. She brings close to two decades of experience across diverse industries, in talent development and employee success. Employee success, which literally is something that the world's been desperately trying to deliver through performance reviews themselves.

Welcome to the show, Danielle, as well as Megan. Thank you so much for taking time out to give back to the community along with us today.

You know, whenever we do an episode of this show, we love to have our audience learn a little bit about the person behind the professional, So today, I'm gonna pop an interesting question albeit a little cliche which is something fun about the person behind the professional that none of our audience members would find on your LinkedIn profile. Daniel, why don't why don't we go with you first?

Okay. Sure. So, I have a very active family to young children, five and three. And, we spent a lot of time on the water in the summer and a few years ago I picked up a sport called Wake surfing.

So, it's it's really fun. It's when you surf behind a a very specific boat.

And, last year, I got my five year old up with me on the board, and Quite a few neighborhood children as well. So it was a lot of fun and, continuing to try to get better and better.

You must be an amazing wake surfer yourself, Daniel, because that's why that's the only way parents in your neighborhood would trust their children on that week board with I I I'm the first one. So I don't know if I'm amazing, but I'm the first one. So I think they they trust the, the, the slight edge of experience that I have over everyone else. That's amazing. Megan, how about you?

Well, I'm definitely gonna look into a wake surfing now. I've I've never seen it or heard about it, but now I'm intrigued.

I'm an avid runner.

I've run three of the six World major marathons.

So I've ran the Chicago marathon, the Berlin marathon, and then last month, I ran the London marathon.

And I'm scheduled to run New York City later this fall. That'll get me my my fourth star, on that journey to getting all six.

This just reminds me of this HDR article where every corporate employee needs to be a corporate athlete and clearly both of you are literally leading that particular charge. So thank you for setting that amazing example to all our audience members. Folks in the audience, as you can imagine, we're here only for you. Now is a good time for you to check out three cool features on the nav bar on this webinar experience. They'll appear on the bottom of your screen. The first one is The usual Zoom chat, I highly encourage you to share your thoughts, opinions, experiences as you listen in to our expert speakers today in that chat. The second one is the polls section.

Polls will keep popping up, through the course of the show because we'd love to learn about your practices as well. And this is a section where you can actually consume the real time live results of our polls as well. Last but not the least is the question section where you can pose questions to our speakers as the show's going on. And as the moderator, I'll try and weave these in into the right parts of the conversation. No pressure on me. But first up, let's get our audience members warmed up in using the chat section itself I'm very curious to know what part of the world are you joining in from today?




the responses start coming in, let me quickly jump right in and share with you what you're gonna cover, what we're gonna cover today. The show's gonna be broken up into four simple sections. The first one's the discover phase where we're gonna learn from our expert experts what needs to change about performance reviews in twenty twenty three and why? We'll very quickly get into the heart of the matter, which is really helping you design your performance review playbook for twenty twenty three, which is where we're gonna understand what are the key design parameters. We've had some prep work with our expert speakers. We've got something already set out for you under that. And they're going to chime in with one of the best practices and recommendations based on various contexts.

Last but not the least, a wonderful design, you know, is only as good as the execution and the implementation.

As you'd know better than me, performance management or even reviews aren't an electrical clients. You can't plumb off the old one and switch on the other. So we're gonna look at what's the best practice around actually driving this change in your respective organizations. And last but not the least, in case you forgot to pop your questions in the questions section of the webinar window, we have some time parked for your questions for the experts as well. Alright. Without further ado,


Performance reviews in 2023 : Yes or no?

let me jump into the first question for our two experts, which Traditionally in my experience has been fairly polarizing.

In twenty twenty three, Danielle, performance reviews, yes or no.


So, I I think it is incredibly important to measure performance throughout the year.

I would just consider moving away from the traditional annual performance review.


I can how about you? Performance reviews? Yes or no?

I agree wholeheartedly with Danielle.

Giving feedback against performance is never going to go away.

However, the traditional once a year review feels all anti acquainted.


And, you know, it's it's not surprising that that you're kind of completely against having that performance conversation only once a year for all the surprises that it kind of brings in. But, you know, I'm curious


What have the last few years really taught us in performance reviews?

to know what are the last few years really taught us in terms of performance reviews.

Megan, why don't why don't you jump in with that one first?

I think what we saw over the last few years is just that employees are craving more and more feedback.

As companies have had to pivot once or twice.

Just the agility of you know, on the spot, constructive, reinforcing feedback around what, you know, what should employees consider doing differently? What what are their strengths?

And just seeing the importance of timely feedback, you're going back to the point of no longer is it okay to only check-in once a year. This should be an ongoing conversation.

Daniel, anything you'd like to add to that? Yeah. So I think, you know, while we were dealing with the pandemic, we pivoted to more of a constant communication model in a lot of places.

And with that, you know, leaders were checking in with their employees.

But the measurement may have been a little bit softer than it had been in prior years because of everything. All of the external factors that were impacting employees personally.

And so then there came this need to correct for that. Right? Correcting for that, but also in conjunction with correcting for that understanding, the shifts that the organization has had to take over the past few years, and how that is impacted what performance actually means. So we may have had some companies that were fully in person that now they're hybrid or now they're remote. What are the expectations around that? What does a successful employee look like in those situations?

So just really trying to re clarify what that success looks like for that company in particular.

So there's been a lot of change and a lot of shift.

No. Absolutely. In fact, Daniel, you know, if I can kind of scratch beneath the surface from that a little bit, like both of you mentioned, performance reviews, yes, traditional performance reviews absolute, but even no, and it's been almost a decade since we kind of collectively as a community, came to that realization in more ways than one. Pretty much kind of got reinforced. You know, what I heard from you about the learnings over the last couple of years.

We're in twenty twenty three. And why do you think You know, we need to resale performance reviews even say a fair few years after that realization that traditional reviews aren't working.

So I think, you know, there's a really tight labor market right now and companies want to hold on to their top talent. And That tops talent is looking to understand what their career path is within the organization, where they have opportunities for growth, and and and development. And so I think it's really important for us to be able to meet those expectations and create a really, really nice employee experience around that as well. Experiences, you know, top of mind for many employees right now and how they're treated and and how they feel in their day to day, whether or not they're committed, whether or not they're really engaged. And so I think right now is the perfect time to really dig into whether or not what we're doing is working.

That's super powerful. And I'm gonna double click into that further when we get into designing the playbook.



Why are we still talking about redesigning performance reviews in 2023?

Megan, you I'm pretty sure you've seen this conversation in various shapes and forms right across electronic arts, GE themselves, who partnered with HBR to really come up with the rank and yank and and kind of throwing that out of the window. And later at Dropbox and now at Western Digital, why do you think we're still talking about redesigning performance reviews in twenty twenty three?

We just can't seem to get it right.

I think it's funny, you know, as we were kind of talking about you know, redesigning performance management, I had to look up when the article by David Rock came out. So a strategy and business magazine, launches article in August of twenty fourteen. And the title was kill your performance ratings. And that really sparked, you know, mass organizations to rethink how performance is measured. And traditional performance management was born out of the industrial era. Right? Like, how many widgets Danielle making in an hour versus is Megan, who's meeting expectations, like, needing to really understand how do you assess performance?

Well, that hasn't truly translated well for today's knowledge workers yet we're still using the same systems.

And as companies, you know, focused on the redesign around ratings versus snow ratings versus really looking at, well, what role does performance manager play in our organization. Why do we do the things that we do? What systems does it connect? Like, what are the the inputs and outputs?

Like, we're still having this conversation because while many companies went towards, you know, lighter continuous conversation with no ratings, You know, you still have to have some rigor in terms of what is the organization driving.

And so here we are nearly ten years later, still having the conversations around wanting to evolve it and make it feel more modern and contemporary.

And now with the uptick in organizations wanting to have, you know, a skills based talent strategy. Like, once again, this becomes incredibly important to think about, well, how are we assessing performance versus, how are we thinking about the skills that our organization needs today And also, you know, how much time should a performance band process take? Like, I think, you know, years and years ago, Deloitte did a study and basically said this is a billion dollar activity. Like, are you getting the value out of all of the hours of employees doing self reviews and providing feedback on others and managers providing feedback and then calibrations and my goodness. I remember, when I was redesigned form management one at one of my organizations I had an employee regged me about taking a personal day to write their self review. Their self review was like fourteen pages. Like, No.

Yeah. That that sort of performance review. That's an internal marketing document.

And Let's let's not even get into what it takes for the process owners.

You know, we we still meet with customers who literally let their family know to forget about them because performance review seasons coming up, for the next couple of months. But, there's so much to unpack right now that I'm gonna use this as a segue to get into our next section because I'm, you know, I heard a lot of connotations around moving away from traditional just assessment rating and measurement approach towards certain terms in terms of developing skills that I heard from Megan you know, towards career paths and actual individual personalized group that I heard from Danielle. So I think this is this is a good time for us now.


What are the design parameters of performance reviews?

The segue into the second section of the show, which is actually going through the design parameters and looking at what you both have learned over the years and your recommendations and best practices. Just for to make it easy for the audience to follow, folks, we met up with Megan and Daniel earlier and we're gonna crunch the playbook into these seven decision making criterias starting off with what should be the overall objective of performance clearly just rating and measurement cannot be the only one is what we've already heard, but we'll double click into that performance reviews.

What's the definition of performance? What should be the criteria of performance? How frequently should you actually be having these performance conversations?

Is there any nuance around timing this with your business cycle, connotations around, you know, coupling or decoupling these with outcomes like compensation or financial outcomes?

One very big thing which is as organizations move away from hierarchical pyramids to dynamic networks, are, you know, is there an element of crowdsourcing performance assessment? Rather than just having a manager and a manager of a manager kind of weighing on someone's performance and outlook and future at the firm.

One big one that we hear a lot from our prospects and customers is can you help me design the right questions, design the right lens? We're gonna get into some of the aspects of ratings no ratings, buckets, labels, and definitely conclude this with something that Megan touched upon, which is the calibration piece. So that's what we're going to try and cover in the next kind of twenty five to thirty odd minutes, no pressure, dear speakers. Let's jump right into the first question itself.


In 2023, what should be the objective of performance reviews?

In twenty twenty three, what should be the objective of my performance review?

Daniel, let's start with you.

So I think that there's a combination of things that we need to consider.

One is where Does the employee want to go? Right? How can we help develop the employee? But also what have what has the employee accomplished over the past year.

Feedback is incredibly important. Megan noted it earlier. People are craving feedback right now. They wanna know how they're doing, and they wanna be able to build a path to move forward.

With that, I think performance reviews can be a great tool for creating talent density within the organization.

So if we are looking at, you know, really tight budgets right now, not being able to add in net new heads or backfills or what have you, can we use the talent that we have on hand to fill those empty roles?

And how do we do that? We we work on development plans. And reviews can be such a great tool for that, but we have to make sure that they're being done regularly and that we're pivoting with the needs of the business as well. So I come from a very different background than Megan.

My my, you know, the companies that I've worked for are very small, very scrappy kind of scaling mode. Right? And so, you know, we don't have these really sophisticated schools or systems that we've used in the past to help us get there. So we've had to do a lot of pivoting and, evolving of of the way that we evaluate talent in the systems that we use to do so.

But one thing that is continuous throughout this is that we wanna create this experience for the employee where the leader is having these conversations, they're able to make sure that the the path is tailored to where the organization is moving towards. And that might mean that you take a couple steps forward and you take a couple steps backwards and you take a couple to the left and a couple to the right. You know, it's it's not a linear path for everyone. And so it's really important that those lines of communication are always open between the employee and the leader and that, you know, we're taking full advantage of what performance management means by Continuing to have open conversations about growth and development.

You know, very, very nuanced insight about, you know, why why did why do we have performance reviews if they aren't actually helping people improve performance. When you mentioned talent density, you know, something that that very few organizations have started doing is actually measuring whether the a percentage of high performance between two review cycles have actually increased or not. And I know Megan, you know, you you love your employee listening data. You love people, but the people's strategy designed based on data driven decisions.


What type of data should performance reviews be generating?

What type of data, should performance reviews be generating.

Are we trying to kind of do a one size fits all, cut the whole kind of people analytics lens or realm with one knife when it comes to trying to get all the answers possible from performance reviews. And therefore, how can we sharpen the knife in terms of keeping the right objectives for for our performance reviews?

I love that question. I and so my advice to a team that is trying to think about how they wanna evolve performance management at the organization is to just start with the basics. Like, Why do we do this? What is the purpose?

And, you know, maybe even, like, sketching it out. Right? Like, a good old fashioned whiteboard session of you know, current state, you know, here's what the process looks like and sketch it out, you know, start to finish and then flag where are all the places that performance management data is used. For example, do you bring it into your talent reviews? Is it used to manage your compensation?

You know, do you look at this data as it relates to attrition?

So really understanding the scope and impact of the performance management cycle, to then look at you know, are you trying to simplify it? Like, what are the pain points you? I would also suggest doing some employee listening to really understand, well, what are the pain points in the organization today? Like, why do people, why do people hate it? Why do people crumble when you say it? Performance management season.

What's getting in the way? So then you can evolve the process to meet your unique needs.

You know, as Daniel aside with the tight labor market, perhaps you're using performance management to ensure that you're truly, rewarding high performers and retaining high performers.

If that's the case, like, challenge yourself and look at the data, are you actually rewarding the high performers, or are you peanut buttering it? Like, is there a def differentiation in comp? And so I would just start with, you know, why do we do this? And what is the purpose? And then look at all the places that the data is used to help you as you evolve. Because often what happens is performance management gets talked about in a silo without realizing all the downstream impacts So as you're evolving one aspect of the process, ensure that you have a plan for all the other pieces.

Yeah. In my in my experience, I've seen organizations being very wedded, you know, to these thirty, forty question multiple section review forms. Only because it gives them some sort of quantitative, you know, data. But when you actually ask them to scratch beneath the surface and ask them the last time they used that, subset of a subset of a subset of arithmetic calculation from the review form, the answer typically is didn't really use it.

So I think in conclusion, two things that I heard there were look at what is the data about your people that personalized data about your people that you want to generate and definitely go beyond just differentiating between high, medium, and local farmers look at clarifying growth opportunities for everyone, because that's the least that your workforce deserves every time that they do participate in the performance review. Interestingly enough, the first poll results about, you know, the objective of performance reviews for our audience. We've clearly got a very progressive audience. Daniel,

almost forty percent of our audience members want to or already drive performance reviews with the objective of clarifying growth opportunities I can see twenty five percent already looking at talent density.

Before I move into the next section, you know, of the playbook design framework, which is the criteria. There's an interesting question, you know, that's popped up. I'm gonna stick my neck out and try and answer this one and then throw it over to you making it Daniel. When they asked us, why do


Why do big companies like Google, Microsoft, and Facebook continue to hold traditional annual or biannual performance reviews?

you think that big companies like Google, Microsoft, Facebook continue to hold traditional annual or biannual performance reviews if the HR community is quite aligned around how heavy and cumbersome the traditional process is.

My take on what we've been learning with, you know, organizations while working with mesh is what I stated earlier on, which is you just can't simply switch off performance reviews. To Megan's point about David Rock's article about killing reviews and ratings, what people miss out is David Rock came out with a slew of books on how leaders and managers need to actually upskill themselves to have continuous performance checkings in a timely manner.

And no matter whether you are a Google, a Microsoft, a Facebook, fang, whatever you are, you're dealing with humans and habit formation takes time. You're expecting leaders, managers, peers to take time out from business as usual to invest in each other's growth. And like any habits that humans need to develop, that's a curve of actually building it out. And while we're trying to build that out, while every person in the organization as David Rock might say is a quiet leader You simply can't do away with some elements of the traditional performance review because it does give you that baseline every now and then through the course of the year, Wendy.

Megan, Daniel, agree, disagree, anything you'd like to add to what I just tried to kind of stick my neck out and share.

Agree, and I'll add on two pieces. Those companies that were referenced, they all have a huge engineering component.

Could you imagine trying to tell a group of engineers?

That you're just not going to assess performance. I mean, these are functions that have daily stand ups, and they're working in what? Four, six, eight, like, mini sprints. Like, they're constantly assessing performance and getting feedback and iterating. Like, this is just a part of how the work is done.

The other comment I will make specific to Google, so in the whole everyone reevaluing performance management. Google went from a twenty point performance management scale to a five point performance management scale. And what I mean by that is previously under the twenty point scale, g c could be a four point six and Danielle could be a four point seven. Could you imagine calibrating on what is the difference between a four point six and a four point seven? And then could you imagine how many hours are spent in this conversation? And then what's the net outcome? Like, is there truly that much of a different and comp in Danielle being given a four point seven versus GC being given a four point six.

So I guess I I would also challenge. I think a lot of organizations are going through this in the the hybrid era of I just can't imagine us not having a physical office. This is all we've ever known worked takes place in an office, then there's that parallel around our mental construct and the struggles to truly step away from something that's been ingrained in all of us.

I will agree with everything that Megan said and everything that GZ said, and I will actually give a small example of something that I've experienced myself in this area. Grreta, this is a much, smaller scale than a Google or a Facebook or anything like that, but I imagine it would be a much bigger problem at at that size. So, a few years ago, we were thinking of, you know, reconstructing performance management at Inverse, and we looked into will be piloted a tool that was a Slack integrated real time feedback tool where we created peer coaches among people and they were to give each other. They were to coach each other, give each other feedback on a very regular basis.

And, after going through the pilot program for a few months, we discovered that people were not as skilled as we thought they were in giving and receiving feedback.

And so for us to move completely to that model with no ratings and really just getting there, It wasn't possible at that point in time and we needed to to go back, take a few steps back and realize that we needed to establish foundational behaviors within the organization and knowledge on how to give and receive feedback. And so I I imagine that with a massive organization, Not everyone is highly skilled in those areas and so they need more of a framework to follow.

Couldn't agree more. The prevalence of timely checkings and then followed by the quality of those checkings. Otherwise, the needle's not moving. Is it? And easier to train managers and leaders on how to kind of articulate feedback than training managers on how to defend a four point six versus a four point seven for sure.

Another question in the chat, but I'm gonna come to that, Megan Mc Way, at the end of the playbook because we've got a section on calibration.

One out eye out on the clock. Think that's a great segue where we're talking about decimal point ratings. Let me


What should be the criteria to define performance and assess and give feedback on it when it comes to performance reviews in 2023?

move into what should be the criteria, to define performance and assess and give feedback on performance when it comes to performance reviews in twenty twenty three. The usual suspects have been the water performance, which could be goals, your sprints, your epics, stories from the engineering example and the how of performance which is really where organizations seem to be headed in terms of skill based rubrics or competencies.

Do those still kind of stand the test of time? Are there any newer ones that are coming up? What do you think Megan?

I think you nailed it in the simplicity. It's the what and the how, what got done and how, you know, with with that anchor to, you know, the cultural values these are tenants.

The only other thing that I would add in, I've always, liked to add in the continuous learning component with my team. Just to kinda reflect on what have you learned over the course of the quarter, whether it's formally or informally, and also make that action to the actual skill that they were developing by codifying it. So for example, if someone on my team, they became a power user in, like, Glint or culture amp, then, you know, framing that as well. Like, you just became a power user in HR technology. So helping connect the dots of you learn this thing, but then also let's name the skill.

Daniel, any thoughts on that?

Yes. Again, fully aligned here, which is really nice and refreshing.

But I would add and this this isn't necessarily performance criteria, but one of the things that I would consider that we generally like to to do here is take the opportunity for the employee to help the manager on understand how the manager can support them better. So just kind of going back to that open lines of communication and understanding where the development needs to take place Sometimes a manager needs to understand that they need to communicate in a different way to an employee or that the employee needs to be considered for a different type of assignment or professional development opportunities, what have you. So I think it's really nice for, you know, yes, there are opportunities for to provide upwards feedback in different ways. But even in, you know, my own review, I wanna give my manager, the tools that he or or she needs to help get me to where I need to be. So that's just one additional thing that I would consider. Yep.

A quick follow-up question for both of you, very often I've come across organizations who understand that performance feedback is holistic when it's about the what and the how. And now, you know, even I've learned a couple of new dimensions, which is about deploys experience, their aspirations, their growth, you know, opportunities.

But a lot of organizations actually go down the path of trying to design the best skills rubric before they can take that into performance. So if I am an organization and I'm an HR leader where I don't really have that fleshed out skills based rubric, although it can't, no skills based rubric in today's day and age can hold the test of time beyond, I think, a couple of years in itself.

Can I use something simple like my organization's core values to at least start baking in the culture of sharing feedback on the how?

Yes. That's what we do.

Yep. Alright. Perfect. There was a loaded question there. So folks, you don't have to wait to bring in get a suit and tie consultants to design your skill based inventory in rubric. You can literally start very small and light by bringing in your core values and actually activating them to the performance review process.

You know, I think it's a good segue way we were talking about iterating and learning and growing through performance reviews. You know, we spoke about how frequently this needs to happen. I think that's the next big question. We've heard at the top of the conversation no more annual reviews alone. They're the reason why you get a fourteen page self review document because no one's really heard this person's sense of achievement for the last twelve months, but


Is there a magic number around the frequency of performance reviews?

Is there is there, like, a magic number around the frequency of performance reviews?


I would say, quarterly.

Just given how quickly the world changes and business priorities change. And, you know, if at the minimum, if you're checking in on, you know, goals and providing feedback a quarterly basis. It allows you the manager to quickly pivot, as well as your employee ensuring that there's no surprises. Throughout the year.

Yeah. I I agree. You know, the more frequently, the better, and if we have a a very specific process around it quarterly. I think that's wonderful.

Ideally, we want to give feedback in real time to our employees and at least you know, weekly in in our one on one meetings with them. So I know that that may not be the the traditional performance review, but it helps create that cadence and that that dialogue that leads to those those quarterly reviews.

Got it. Got it. When it comes to quarterly reviews, I am tempted to ask both of you.

What should be the ideal length of a performance review if I have to fill it four times a quarter.

Megan, how about how about you take a step at that first? Oh, goodness.

Short and easy.

I think the best that I've ever seen was, it was less than three pages. Right? It's it's the language that the company used was continues and considers.

Right? So it's what are things that Megan should continue doing? What are some considers, right, like, what would help her set her up for success or, you know, to do things differently.

And then, you know, so it's high level, like, continues considers, and then tying into, like, well, what's the next quarter going to look like? I don't I don't think that these are things that need to be over complicated with, you know, pages upon pages. It's high level. What do I do well? What can I do differently? Thank you.

The end.

I love that continues and considers language. I think that's really nice. And I think, you know, to just, add to what Megan said. It's Where's my brag sheet? Right. What did I do over the last quarter?

And then what am I aiming to accomplish in the quarter. How can you help me get there? I think the simpler, the better.

It doesn't need to be a complicated process or a complicated discussion.

Got it. Correct. Close to half of our audience members organizations run their reviews by annually.

There's still a quarter that are running it annually.

So I'm I'm pretty sure for that quarter of the audience. This is like a gold mine of a conversation.

Congratulations to the nineteen percent who run it quarterly to be very honest.

Staying with performance review form design.

And I'm known to be notoriously nuts and bolts when it comes to designing playbooks. There is also a question in the chat. So I'm going to take a lead from Megan's question in the chat, which is we seem to have quite a few Megan on today's show.

How do you tangibly rate or score what gets done in the context?

You know, smaller companies still scaling competencies but objectives in KPIs are changing every few months and weeks in the middle of a review cycle. I think we already heard Megan and Daniel mentioned that quarterly reviews actually help you and help the manager, you know, ahead of the curve iterate on the goals because they may no longer be relevant given how dynamic the external world is. But the


Are we ditching performance ratings?

second part, or the undertone of that question is I've got continuous considers largely qualitative forward looking feedback an appreciation kind of performance review design. Are we then ditching meticulously delivering weighted average ratings on my goals that we used to kind of be so proud of in the past?

I would hope so.

Spoiler alert, I haven't worked in an organization that's had performance ratings in a decade.

And so, you know, I've spent the last ten years in organizations that are more progressive in how feedback is given.

And so I wouldn't even know how to answer the around waiting averages and all that other fun stuff. I think what we're moving away from is this laundry list of, you know, the twenty things.

That you did and getting more high level.

So we started the call with our fun facts, about sports.

I'm gonna use a marathon analogy. Right? Like, over the course of the quarter, maybe the goal is run a marathon. And then behind the scenes, it's all of, like, the various workouts and recovery days and going to physical therapy.

It's not necessarily like checking off. Here's all the little things that I did behind the means, it's more of, like, the focus on. Well, what was the marathon performance? What did I learn over the course of that event What can I do differently for the next one?

If there's specific constructive feedback of you didn't do any of your speed workouts, like, then I would bring that into, like, the overall conversation, but it's not it's not this, like, litany of the nuances.


I am going to come back to the rating less, decade long experience that you've had Megan, but Daniel, how about you? How does I think the the undertone of the question is, you know, how do you then have a performance review form that holds people accountable for their delivery to the business outcomes. Yeah. So we I mean, ideally, I mean, well, first of all, I'm really jealous of Megan's decade of no performance rating experience. I'm not in that place at all.

But, you know, I If you notice the sarcasm when she said the fun stuff around weighted average ratings, Yeah. Yes. I did. Yes. I did.

Unfortunately, that is not, something that I can relate to. So But but, the way that I think about it is you have your dashboards and you have your metrics for for certain you know, goals that you need to accomplish on a regular basis. Like, we're very metrics heavy at inverse, and we're reporting out quarterly on where we're heading in all of these various areas.

And you take a holistic view of that into the performance review. Right? So You know, your manager should be looking at those metrics on a regular basis and having conversations with you if they're not aligning with what the performance expectations are. Now the the overall is a different story. It's more high level and it's more of a summary of where you are as an employee in your performance. So that's That's how I think of it currently with with where we are in a scaling organization and what we need to report out to and board meetings and and what have you.

Another thing to add is the flexibility of, you know, some departments might need more nuance metrics than others. For example, the sales function, like, stat fully driven, unquoted So their form might look a little different, then perhaps, you know, I don't know, HR. And so this goes back to the conversation. I'm like, well, what should it include? And, you know, as you're designing for the organization, what is the organization? Need. So if you put on your CPO hat of what am I reporting to the executive leadership team or the board of directors, like, what does that look like versus what do the individual functions need their scorecards to look like in order to tie back to the goals that they're tasked with?

Right, some absolute pose of wisdom. I'm going to attempt to kind of summarize some of that. First up, I think, to Megan Taylor's question, I'll just lead from what Daniel mentioned. There's a difference between an MIS and a dashboard and the strategic goals that an individual is getting after, don't try and stuff your MIS and dashboard in the garb of alignment into your performance reviews.

In fact, goals themselves change so frequently that your MIS and dashboard needs to become more and more holistic and that's a separate business operations activity. The second thing that I heard is, of what we've kind of started seeing, almost taking Novotis' example, where Novotis today has their MISs and dash floats, they know the health of the business at any point in time, but everyone in the organization self authors their own goals. Why because goals aren't for the purpose of ratings at weighted average scores? Goals are for the purpose of people actually finding purpose at work and meaning it work and feeling adequately challenged and stretched and the moment you start actually rating people on those stretch goals, they start sandbagging them.

So you're actually going to start creating an organization where everyone wants to be better than that preset benchmark rather than actually growing and developing them and delivering talent density.

Moving on, I'm I'm keen to kind of speak about, you know, the organization network at play today. We spoke about how organizations are no longer built for efficiency and control aren't hierarchical pyramids are dynamic team of teams, and I can throw more jargon from my consulting days, at the audience per se around this. But we're no longer a rigid organization. We're almost a living organism.

And there was a question in the chat about manager to employee review processes are known to have greater biases you know, how can we kind of reduce these biases as well? So what


What are we to do differently in activating an individual’s personalized organization network when it comes to delivering performance reviews today?

are we what are we to do differently in activating an individual's personalized organization network when it comes to delivering performance reviews today, maybe if we could start with you. Yeah. Fabulous question.

I always ask my direct reports, like, who have you worked with over the past quarter that you'd like me to reach out to for feedback from.

In a perfect world, my employees are always asking for feedback.

But sometimes it's easier to have the manager ask on their behalf. Just knowing that, you know, how I see my direct report show up is going to look different than how their peers see them. And I can't be in every single meeting with my direct report. So having that that broader perspective, I think that also comes to light in hybrid or virtual environments of, you know, simply asking the employee who have you worked with that you'd like some feedback from.

And just encouraging them, you know, from, hey, you don't need to wait for me to ask during our quarterly check ins.

You could also be doing this as you see fit. And there's also the element of what can the organization do to foster that psychological safety around asking feedback?

Daniel, when it comes to performance reviews, Huawei, what are your recommendations on activating a wider network than just my manager who I report into. Yeah. So I agree that, you know, asking for the employee to to choose someone that they've worked closely with to provide feedback is really important.

I think it's also important for us to consider the various biases that may come into play when it comes to giving feedback.

And really focusing maybe working with, your L and D team or external consultants or what have you to really tackle what does implicit bias look like? What does proximity bias look like? What does recency bias look like? And training folks on that and how they may be able to kind of get away from that a little bit to help provide a more fair, feedback, if you will.


Is there an underlying trust issue in crowdsourcing feedback during performance reviews?

Is there also an underlying issue of not trusting our people enough?

I'll kind of ask that in a loaded manner.

I've come across situations where when organizations want to kind of crowdsource feedback, they get the HRBP involved to decide the right network. They get the manager involved. They crawl, you know, Microsoft communication tools data see who have you actually collaborated with. Rather than just simplifying the process and asking the individual to serve up eight or ten names who would have the right feedback for them.

Do you do you see that as a trust challenge? Have you experienced, you know, because very quickly we're going to get into the change management side of actually your new revised performance review playbook. So is there a mindset issue with play as well?

I think there's been a trust issue for a while now. And I think we're finally starting to move to to recognize it. Right? So I I think your question is valid and I don't know the answer to it really other than I think there is a trust issue.

It's the same thing that we dealt with when no employees can work remotely. Now everyone can work remotely. You know, it's We're adults and and and we need to be treated as such and know that, you know, most people are coming into to work every day. To to do a really good job.

They, you know, they don't wanna come in and phone it in. They want to feel accomplished and part of something. And it they should be able to tell you who should provide them with feedback.

Megan, I'm gonna build on that question a little bit. I know resting from the playbook at play, but this is really seems like at the heart of the matter. And I know you, you know, from your experience in employee listening, trust is like one of the most common questions that pop up in an engagement survey for many decades, but even if I get a little score on I trust my organization's performance management process or I have trust in my leaders.

How do you go back to the leadership in kind of deliver that news with, we need to change the scope because the ROI is such and such. Have you had any experiences of that sort when it comes to trust at play with performance reviews?

What I've seen in the past is a lack of trust in the leader setting the employee up for success.

And what I mean by that is free in a company where there was ratings used, ratings were a proxy for differentiating compensation.

And so what ended up happening was there were parameters around how many people could be given, you know, a meets expectations versus an seeds. And so there'd be scenarios where leaders who hadn't been providing feedback throughout the year. Then the review becomes a surprise and then it becomes blame HR for the compensation element.

And so in the work around what needs to change. It was surfacing these ugly realities around this is the current state. It is broken. Like, the like, employees are being surprised by performance feedback is having an impact on their overall compensation, which is impacting engagement and retention, etcetera, etcetera.

And so just taking that honest look in the organization, you know, while serving up the question, you know, in an engagement survey, helps, I would say like do the double click around. Well, what is the process? Or is there a shadow process So you gave that great example of, is there a shadow process where HR is involving themselves and saying yes or no to request for feedback?

If so, well, then also let's factor in how much more time does that add to this process that everybody's complaining is way too long. And so I think just really understanding what's the current state in your organization today and are there shadow processes, that are coming into play? And really getting to what is the root cause. So as you're redesigning performance management for your organization, you can be clear, the why, like, what compelled us to make these changes? Who do we want to be in the future and how did the dots all connect?


I think carrying on with the trust pieces also the fact around, a big question that comes in in designing performance review forms and while your crowdsourcing peer feedback is, do I deliver that anonymously or do I deliver that with people and peers' names? Have you come across that? Have you you kind of encountered that common room per se?

We've had issues with that. Yeah.

And and I'll just go back to what what I mentioned earlier.

We didn't have this baseline for how to give and receive feedback. And so people were really scared of delivering something constructive because of how it might be perceived. And so obviously, I prefer not having anonymous feedback. I I think it doesn't allow for dialogue. It doesn't allow for follow-up.

But where we are currently, that's where people feel safe. And so we're building on how people can feel more psychologically safe giving and receiving feedback in real time.

That's so powerful. I think it leads back to our earlier conversation. It's a journey It's not an electrical appliance. So assess the maturity of giving and receiving feedback and that practice and that habit for yourself, but the end goal needs to be making it non anonymous is what I heard there, Daniel.

Alright. In the interest of time, I'm I'm gonna move forward because I'm gonna build on couple of other questions, but I'm gonna come back to what Megan said because Daniel and I are extremely envies. Megan, ten years in organization. Without performance reviews, without performance ratings per se. How are you deciding on every outcome that's today been linked to that little one singular number that we reduce our people to, you know, every now and then once or twice a year. How did you decide on compensation decisions on progression decisions on, you know, n number of decisions when you didn't have the luxury which is obviously the organization's luxury and the individual's pain to be reduced to that one numeric rating.

Everyone wants to talk about how you decouple compensation.

So first, I would challenge, you know, look at the compensation data coming out of your performance review. Like, does it actually match, you know, meets expectations is three percent. Or are you seeing managers giving, I don't know, three and a half percent versus four percent? And so looking at through the lens of, well, if the rating is driving compensation, then are we actually empowering our leaders to make business decisions for their teams.

And so what most organizations who decouple this do is they empower their leaders, and you can choose the level. Like, do you go down to your senior manager? Do you keep it at senior director and above, etcetera, etcetera.

But it really comes down to you have a budget, useless. Let's say your budget is a hundred thousand dollars. You have to allocate this across your team and then you have to own the conversation.

The end.

It's the same as if you had ratings. You're still giving compensation to a budget. You're just figuring the numbers differently. And it's easier for the leader to say, you met expectations.

You get three percent versus Wow. Like, throughout the year, we've been having these conversations about your performance. You've gone above and beyond. Therefore, I'm rewarding you with, you know, twelve thousand dollars blah blah blah.

Here's your new account. So using it as a proxy for leadership effectiveness.

And, again, managing to the budget and having all the systems in place to own to that. So ratings are no ratings. You're still managing into a budget and most companies don't have, an open bank account where, you know, you can go wild and so, you know, for for your organization, we're really kind of figuring out what are those levers, depending on what your HRIS looks like, you may be able to also do some tooling within the system. I work at one company where we did some tooling where, you know, we provided recommendations of know, like eight to ten thousand dollars. And if the leader wanted to go over by a certain percentage, then it flagged to their plus one. It flagged to compensation.

So you have the ability of, like, running all of the the equity reviews against the comp. But I guess, like, the moral of the story I would say is it's honestly no different. Like, I would really just challenge. Pull the comp data for your last performance review and bump it up against those ratings and look how much leaders are actually differentiating from that flat, you know, standard three percent. So leaders most likely are differentiating today.

But by moving away from ratings, it forces the leader you more of a driver's seat in the conversation versus just putting it on HR.

And and promotions promotions and talent reviews. So, again, it goes back to the, like, look at where where does performance management data show up today? How what role is it playing in your business?

You know, we were talking in our prep call around how with all of the the layoffs that have been happening over the last six plus months.

It'd be fascinating to see the analysis against performance management data and how many of the employees that their roles were eliminated due to business needs were meeting or exceeding expectations.

So just kind of challenging the you know, for companies that put all this stock on, we need to have ratings in order to figure out who we should be promoting or who we're who we wanna retain or what the critical roles are. Like, Billy, is you're basing all of that on your one to five rating scale?

No, I I think that's that's such a powerful thing that you mentioned because at the end of the day, if your leaders aren't actually delivering the last mile message, then you know you don't really have an open and transparent culture and if you have leaders who are hiding behind ratings, normal curves, which is the next thing I'm gonna get into, then there aren't any honest conversations happening in your organization in the first place either.

So getting into, you know, the last part design parameter and there are a few questions in the chat around that saying, Hey, how can you grow high performers if you've got a force normal curve in your calibrations.

So, Daniel,


Why do we need calibrations?

when it comes to calibrations, why do we need calibrations?

Is the normal curve and rank and yank the only thing that's available?

It does the nine box still work or is there something completely new that you're seeing that's working well?

I mean, ideally, I'm living in Megan's world. Right? But I am in a very different world right now. I have to be completely transparent.

And I I despise forced, curves. Right? So when we take a look at our ratings, our nine box, we we, you know, we have done calibration exercises We've done some pretty in-depth calibration exercises with lots of people in a room and it's a whole, you know, off-site and time consuming. It's not something that we could do on a regular basis, but it just really helps to to level at people on, you know, what what does meets expectations mean versus exceeds expectations versus does not meet expectations.

And I I think that if if you are in the world where you have to have these ratings, or you're you're you're pushing towards not having the ratings, but you're not quite there yet.

Then I think it's really important to conduct these exercises to simplify the rating scale first and foremost. Right? If you're on a twenty point rating scale with several decimals in between that that is that is mind boggling to me. If you're on a three to five point rating scale and it's simplified, that's something where a calibration exercise is a lot easier take on, and I think it's incredibly important for us to have these leaders with, similar expectations as to what, you know, good and great means within the organization.

Megan, what am I calibrating on if I don't have readings?

You're still calibrating on the what and the how. What did somebody accomplish?

And how'd they how how? Right? Like, did they they got the work done, but they left bodies in their wake? Or, you know, did they truly work work with others? So This is where, you know, having, like, what are the expectations of the role and the job level? Like, what do you expect of your directors versus your senior directors? So as you're having the conversation and calibrating to ensure you know, consistency, but also to Daniel's point, like, it's a really great exercise for continuing to develop leaders.

Capacity and capability of assessing great talent.

And you're having, like, the discussions to get away from the biases around, you know, while I work with this person all the time, they're fantastic. It's like, well, how do how are my peers seeing my direct report? How how are they looking at the performance. Is it I know they're amazing, but nobody else's, like, it kind of brings up a lot of a lot of conversations. But again, it's rather than us calibrating on what is a four look like. It's well, what is what is great performance look like? And in talking about the behaviors and the outcomes?

I'm, again, gonna try and summarize this into three three key things that I heard. And this is gonna answer Michael your questions in the chat. Thank you so much for sending in all of those powerful questions. I was wondering It's been about fifty nine minutes talking about performance management and OKRs haven't come up, shocking.

What I heard both of you say, I'm just gonna try and kind of summarize it. The first thing is, Megan to your last point, which is calibrations and normal curves essentially aren't to compare people against people. They're to compare people against the gold standard in the role that they are in. If I could just kind of articulate it in that manner.

The second aspect is, you know, Daniel, to your point. Simplify the rating scales, simplify the number of ratings because you don't want you want people to index on quality feedback, not on the math behind the ratings. You don't want minutes to be spent in a performance feedback conversation trying to explain the math behind it. And, Michael, to your earlier question, it is still possible.

To talk about an individual's goals without actually rating them in general per se, which is what Megan you can still talk about the what and the how and differentiate when you compare it against the gold standard without unnecessarily needing what Daniel mentioned is the very very heavy kind of arithmetic approach to things. Continue to simplify that. And last but not the least, If your organization still feels the need for performance, for calibration against the force bell curve, the challenge is not in the calibration itself. The challenge is in the fact that you are realizing that your business hasn't done well, but your managers have rated a bunch of people are superstars, which means your managers are avoiding difficult conversations.

So empower your managers to Megan's earlier point about how can you really decouple performance reviews from ratings compensation and other decisions. I know we're up, you know, on the clock in the time. So I'm gonna crunch the last question


What are the sequential steps HR leaders should take in executing their performance review plans?

in folks all of our participants and audiences have now designed in their head what their performance review this year needs to look like. How would they take this to this to their organizations?

What are the top two, three sequential steps that they should do this in in order to make this a success? Daniel, let's start with you. Okay. So, I love to pilot new ideas within focus groups, first and foremost.

So sometimes I'll go to the HR team. We'll pick and choose people that we think are influencers within the organization, get their feedback, we'll involve our internal communications team, bring it to the executive team in a nice pretty package, and then lay it out for the rest of the leadership team.

There's a lot of, you know, iterating messages reiterating messages, reiterating them again in various forms, whether that be, you know, meetings, Slack messages, emails, but lots of follow ups.

And just, keeping an open mind to feedback and, being able to remain Well, it's really important.

Megan, your secret sauce?

I, employee listening. Get really really clear on what are the current pain points in the process today to help as you're designing that future state be really clear in your why. Like, why are we doing this? Why are we evolving performance management?

Because that's gonna be the question that keeps coming up. And as you get to the change management for the organization, needing to have that story. Right? Like, it's not It's not.

We're getting rid of ratings because that's the cool hip thing to do. It's, you know, we did a lot of listening and we heard, you know, these are the pain points. That came up or here's the inconsistencies.

And as we're thinking about what the future looks like, you know, here are the pieces that matter to us.

And, you know, I I love Danielle's comment around piloting, like, as you're doing your employee listening, like, find those leaders that you can lean on that might be interested in testing out some of these things because then they'll also be your advocates as part of the change management.

No surprise that more than half of our audience members already have leadership buying to relook at performance reviews in twenty twenty three, not a surprise to be very honest. But we've come up to the end of our time here. Thank you so much, Daniel, and Megan, for taking time out and sharing what has been an absolutely phenomenal insight rich sixty minutes if I can say so myself. I've been furiously making notes.

I hope you haven't been hearing my clicking and typing. In a nutshell, I think, I'm going to take both of your leads on the last piece around driving this change and say, hey, if you're relooking at your performance reviews, ask your people what they'd like to see differently. And from a business's perspective, you really need to leverage performance reviews in twenty twenty three to help your people clearly see how they grow in the organization because if you won't grow your people, even through a performance review and assessment process, very soon your competition will. Thank you so much, everyone.

Have a great time for the rest of your Wednesday and the rest of the week. And I hope to see a lot more of you on our next performance puzzle episode. Once again, thank you, Daniel. Thank you Megan for doing this.

Thank you for having us. Thank you. It's been fun.

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About The Performance Puzzle by GC

The Performance Puzzle" – your monthly ticket to a rollercoaster ride through the thrilling, perplexing, and downright fascinating world of performance management. Managing performance is like juggling flaming swords on a tightrope over a pit of hungry tigers (metaphorically speaking, of course).
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Each month, our show invites superstar guest speakers from the HR galaxy to share their wisdom, battle scars, and game-changing strategies for conquering the performance management maze. Whether it's tackling the challenges of remote work, mastering the art of goal setting, or decoding the mysteries of employee feedback, we've got it all covered.
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