The Unconventional Guide to Performance Reviews

I think performance reviews are misunderstood.

I’m still not 100% sure how I feel about them, on one hand I really like them, and on the other, I find they could be useless.

I’ve written a lot about this subject lately, I’ve mentioned how I think it’s time to get rid of performance reviews, but then talking about how my performance review went (very well).

I was talking with a friend about my performance review, and right away they interrupted me and said “do you actually like performance reviews? I hate them!”, and then I responded “that’s because you’re doing them wrong”.

That’s when it finally hit me.

Performance reviews can work, they can actually be great, and be very beneficial to employees, but most companies are doing them all wrong.

The problem goes much deeper than the performance review process.

The problem really comes down to the company’s culture. Does the employee have a good relationship with their manager? Can the employee be honest during his feedback session, without the fear of getting into trouble? Does the manager actually care enough about the employee?

Without being able to answer these questions, and potentially fix these problems, you’re gonna have a bad time.

Examples Of Performance Reviews

Let’s look at a few successful companies, and how they handle the performance review process, but I especially want to focus on Netflix.

In an article for Harvard Business Review, Patty McCord, their Chief Talent Officer (and person responsible for their famous culture document), talked about how they approached a lot of their HR policies.

The part about performance reviews is what I’ll focus on here, but it’s a really great article.

In it, she writes:

“Many years ago we eliminated formal reviews. We had held them for a while but came to realize they didn’t make sense—they were too ritualistic and too infrequent. So we asked managers and employees to have conversations about performance as an organic part of their work. In many functions—sales, engineering, product development—it’s fairly obvious how well people are doing. (As companies develop better analytics to measure performance, this becomes even truer.) Building a bureaucracy and elaborate rituals around measuring performance usually doesn’t improve it.”

She then goes on to talk about Performance Improvement Plans (or PIPs), and how much she hates them, and how much they don’t work. I wrote a similar article not long ago about how bad they are.

They shifted to a 360-degree process that was first done by software, and then became face to face. I really like this idea.

The last line of this section is really where you should be paying attention:

“If you talk simply and honestly about performance on a regular basis, you can get good results—probably better ones than a company that grades everyone on a five-point scale.”

Adobe, Motorola, and Expedia are other examples of companies that got rid of traditional performance reviews, because they weren’t working, and replaced them with frequent check-ins instead.

This is the key.

Frequent feedback is what’s important. I’m not necessarily advocating getting rid of them altogether, because now that I recently had mine, I realized that there is some value there, but again, our culture is amazing here.

Here is how I think you should approach performance reviews.

Frequent Check-ins

At least once every 2 weeks, you and an employee should sit down for maybe 15 minutes, and discuss, very informally, how the last 2 weeks went. What are 2 things that went well, 2 things that didn’t go well, and 2 things you’d ideally like to improve for the next week.

Quarterly Performance Reviews

Every 3 months, a slightly more formal review. I personally like having someone from HR there to make the meeting more serious and official. There’s a certain sense of formality that I feel when someone from HR is there.

Annual Performance Review

Again, it doesn’t necessarily have to last long, but a discussion looking back over the whole year. The key ingredient here is data. If you have no data, and you’re trying to recall a person’s performance across an entire year, you’re gonna have a bad time.

Your Turn: What Do You Think Of Performance Reviews?

Do they work? Are they a waste of time? Let me know your thoughts in the comments!

The Unconventional Guide to Performance Reviews