Feb 11

Performance Reviews…and I don’t mean investment performance

I know this is a finance-related blog but I’m compelled to vent about something that has bugged me my whole career…the dreaded annual performance review…anyway…

I was just readng Felix Salmon’s latest post, and found a sentence that I always believed in but thought I was the only one (mainly because it was just personal observation as opposed to owning any actual evidence)…

There is absolutely zero evidence that frequent, rigorous performance reviews ever do any good, and quite a lot of reason to believe that they actually do harm.

The link in Salmon’s sentence takes you to an outstanding articulate logical explanation of the failure of the annual performance review…music to my ears.

Key points…

  • Two people, two mindsets…the employee is thinking career progression, job progression and salary increases whilst the boss is picking holes in performance that could be improved
  • Performance doesn’t determine pay…although I do believe it might determine size of bonus but I found out last year even that isn’t always true (I’m still pi**ed about that)
  • Objectivity is subjective…let’s face it, two different bosses more often than not would conclude differently on one’s performance (often its a personality contest)
  • One size does not fit all…unfortunately the performance review is focused on a pre-determined checklist that may sometimes have little correlation to the true performance
  • Personal development is impeded…thanks to the performance review the boss is often the last person one goes to when they need help…wrong behaviour
  • Disruption to teamwork…the performance review has the tendency to undermine the teamwork aspect between boss and employee
  • Immorality of justifying corporate improvement…I think we all know that the performance review actually adds nothing to the bottom line of corporate performance.

The proposed solution is a “two-sided, recriprocally accountable, performance preview”…this implies that the performance of the employee is accountable to the boss, whose job it is to help, guide, and coach not the one-way, employee acountable method that dominates today.  This provides an environment where the focus is “about problem solving and not problem creating”…read the article for better justification than I can provide in a few words.

Personally, I couldn’t care less, and never have, about my performance review…I know how I’m going and always have and I’ve just wanted to get on with my job and do the best I can. The performance review has always been an annoying distraction to my day. If things aren’t going well, then the performance review is way too late, and my boss would or should have been communicating this to me way before.

Now if I can only convince my employer to ditch the performance review…mmmm…or perhaps I need to be the employer. 😉

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