Much like the smell from an overripe Camembert, the annual performance review continues to linger in the dark recesses of the corporate world. An anxiety ridden process in which an entire year’s worth of accomplishments (and failures) are dutifully summed up and graded. Making things worse, it’s often tied to the annual salary action and/or performance bonus process.
Why would an employee ever participate in a fulsome discussion about their development areas, a critical part of growth, if it feels like their compensation will be impacted? Rather than focussing on elevating the employee’s performance, the discussion feels more like a negotiation, with the employee vying for the highest possible grade in order to maximize their compensation and advancement opportunities.
Clearly, there is a need to talk to an employee about their performance. But what should you do instead of an annual review?
The following is a sample performance management process I’ve successfully used in the past.
What is a performance management system?
At its core, it is an ongoing conversation between a manager and an employee about their job performance. Most importantly, this conversation is designed to ensure an employee is getting the support they need to continue to grow and thrive.
Why implement a performance management system?
Business Unicorn Inc.’s success is directly tied to that of its human capital (fancy business word for people). Ensuring all team members have an opportunity to grow and thrive will greatly enhance the company’s ability to meet its corporate objectives.
More specifically, performance management helps:
- Increase employee engagement;
- Increase retention;
- Foster a growth focused corporate culture;
- Build employee autonomy and accountability;
- Strengthen manager-employee relationships;
- Increase organizational performance; and
- Improve the bottom line (yes, I said it).
Guiding Principles (the musts)
- It must be simple and lightweight.
- It must be continuous (i.e. not once a year).
- It must be grounded in psychological safety.
- It must involve two way communication. The more the employee talks and the manager listens, the better.
- It must be flexible enough to accommodate each individual employee’s objectives and growth requirements.
- It must not be tied to compensation discussions.
Performance Management: The Business Unicorn Way
- At a minimum of once per quarter, managers must have a dedicated performance management discussion with each of their direct reports.
- The discussion should be between 15 and 30 minutes.
- As much as possible, it should be employee led. Managers should listen and guide, not dominate.
- The meeting should cover the same areas|questions each time, ensuring the employee knows the topics in advance.
- Each discussion should be documented.
The Questions
| Notes | |
| Are you happy at work? | Allow the conversation to go where the employee takes it. If they answer with anything other than an enthusiastic yes, ask open-ended questions (like “what would get you to a 10/10 on the happy scale?”) to find out why. |
| What achievements are you proud of? | Start with the employee talking about their significant accomplishments since you last spoke. Make sure you, as their manager, come with something to show you are paying attention and recognize|value their contribution. Note: If the employee had specific objectives for the quarter and achieved them, discuss it here. |
| What isn’t going well? | Same as above. Start by giving the employee an opportunity to discuss their self-assessed development areas. Then bring any constructive feedback you have. Remember, your mission is to solve any issues that are raised. Note: If the employee had specific objectives for the quarter and did not achieve them, discuss it here. Remember, this is not about chastising. It is about elevating, understanding what the problems are and how you can help the employee improve. |
| Any roadblocks to your performance? | Find out if anything external to the employee is blocking them. It might be personal, professional development required, difficulties with another employee…the list goes on. This question is meant to initiate a voyage of discovery. Remember, your mission is to solve any issues that are raised. |
| Any feedback for me? Things I can be doing better as your manager? | This is where psychological safety comes into its own. You must nurture an environment where employees feel entirely comfortable answering these two questions. |
| Any suggestions for how Business Unicorn Inc. could be doing better? | This is entirely about listening. Ensuring the employee’s opinions are listened to and they understand they are an important part of making Business Unicorn Inc. better. |
| Objectives for the next 3 months? | Work with the employee on setting specific objectives for the next three months. Things that will make them and Business Unicorn Inc. better. |
| Where would you like to be in three years? | This is an important growth question. Understanding where the employee wants their career to go will inform the support you provide them now, objectives that are set and professional development that occurs. |
If you have any questions about this policy, or how it’s been implemented, please leave a comment or use the Contact Me form.
An easy read, with informative and practical suggestions. I would absolutely adopt this approach.