Performance Management – Keep it simple

In one of the earlier posts here, Performance management was called out to be one of the least understood domain. I, in fact, think its one of the MOST OVERRATED process. No, I am not saying its not important… I just feel that many companies have over complicated a fairly straight forward function. Here is how the whole “process” works in many companies:

  1. The employee is asked to fill out a long form, which includes her achievements, areas of improvement, support received, support not received, strengths, weaknesses, aspiration etc etc. As expected, most employees refrain from saying things that will adversely impact their hike / rating / promotions…. This takes a few days at the very least.
  2. The manager then goes over this with the employee to give her a good hearing and charts out a plan to address areas that need to be addressed – the plans put out are more often than not, not implemented subsequently. Watch out for the same set of inputs in the subsequent appraisal to understand whether they were indeed implemented or not.
  3. The manager then reviews this with HIS / HER boss to normalize things across teams and functions and comes up with the final hike / rating and promotions.
  4. The decisions are then communicated to the employee as part of a pretty long and typically stressful meeting. The focus is on retro fitting the hike that the manager decided to a rating.
  5. After a few days, the employee comes back with concerns about the way it was handled…. “My rating was lower than expected”, “would have liked more hike” etc etc.

Now the whole process is not only pretty long drawn (I have been in companies where this process took 1 1/2 months or more… twice a year), it also takes away a fair amount of mind share and focus from the core activity of building a product.

An alternate approach that I have found much more effective has the following characteristics:

  1. You, as a manager, is responsible for working very closely with the person and feedback is given then and there – for both good and bad performance. “Your handling of this customer complaint was impressive – here is why”, “Your commitment in getting this module out was awesome”, “You screwed up on this sales call – and here is how I think you should have handled it”. The results of the good or bad performance is fresh in the mind when the feedback is provided. You dont say during the performance appraisal “You messed up the documentation 2 months back”. This also gives a chance to the person to rectify things as quickly as possible. If you do not work closely with a person, get her immediate supervisor to do the performance appraisal. You dont.
  2. There is no surprise (positive or negative) during the performance appraisal – the person pretty much knows what to expect based on the continuous inputs received. If the person is surprised at the rating that you give her, it just means that you as her manager have not done your job and had her waiting till the performance appraisal to tell her how she has been doing.
  3. In short, feedback is then and there and continuous.
  4. In response, also build a culture that allows people to raise their concerns as soon as it impacts their work. To their “boss’s boss (if the concern involves the boss herself). The person cannot say, “I did not get clear specifications for this functionality 3 months back” during the appraisal.

This changes the whole performance appraisal from a “big band one time stressful” to an “on going continuously improving” process.

The common justification provided for the “big band one time” is that, it lets the employee to step back, reflect and set medium / long term goals. While it is important to “step back, reflect and set medium / long term goals”, I dont believe they need to be during the performance appraisal. It needs to be in response to an event (your competition launching an update ahead of you, the person realizing that he is working on a technology that doesn’t interest him, the person wanting to move into a more customer facing role, the person feeling he cannot work with a particular individual and wants a change).

These (and a lot more, in a typical product organization) require course corrections and changes to the way we work and set goals, but these hardly need to be part of the performance appraisals.

Keep it simple!!!!


– NWritings

Performance management – Beyond ratings & rankings

The topic on performance management (popularly known as performance appraisal) is one of the least understood and complex topics in management. Especially in Indian context, often it is linked with annual/bi-annual salary raises/promotions. At an outset it might look like a mundane ceremony done for name-sake,where favoritism (or impression with direct reporting manager) plays a major role. But the real spirit of performance management and the idea behind it goes much deeper than that.

When I started doing performance management in my team, I understood the awareness among members is much less. In order to improve that and build better mutual understanding, came up with some material which is shared below with some modifications. Going forward, I will be sharing a series of presentations under this topic. While there might be minor modifications among organizations in operational aspects, the core message remains the same.