Deloitte, an organization with over 263,000 employees, has one of the simplest performance review forms I’ve ever seen.
It is just four questions -
- Given what I know of this person’s performance, and if it were my money, I would award this person the highest possible compensation increase and bonus. [1-5]
- Given what I know of this person’s performance, I would always want him or her on my team. [1-5]
- This person is at risk for low performance. [Yes or No]
- This person is ready for promotion today. [Yes or No]
Despite it’s simplicity there is tremendous sophistication built into these questions.
Reviewers evaluate what they know
Deloitte asks questions that managers already know the answers to. This is one of those simple changes that seems so obvious in retrospect that you know it is brilliant.
Imagine a scenario, a new pizza place has opened in town and you are trying to determine if you should go. You could ask your friend, who has been, about the cheese stretch (1-5), dough crunch (1-5) and sauce tang (1-5), or you could ask your friend whether they liked the pizza and whether they plan to go back. If you ask about pizza characteristics your friend is annoyed and has to micro-analyze the pizza experience in a way they are not prepared for. If you ask whether they liked the pizza you don’t take up much of their time and they're prepared to give you an answer.
When we ask managers about employee skills and attributes they have to answer questions they don’t already know the answers to. And it is even worse that that, Deloitte found that scores for skills have more to do with the reviewer than they do with the employee. For example a manager's’ feelings about critical reasoning skills greatly impacts the scores they give for critical reasoning. Managers don’t like rating employees on skills, and it turns out they are horrible at it too.
That is why all four of Deloitte's questions are about things the manager should already have an answer for.
Less time more often
Deloitte has team leaders fill out their short review after every project or quarter, whichever is more frequent. These more frequent reviews give the company more data points about their employees' performance over time, and they spread out feedback over the whole year for a more accurate annual score.
The important thing to remember is that doing these frequent reviews is made possible by dramatically simplifying each review cycle. A manager can fill out Deloitte’s four questions in well under 5 minutes, which has made regular employee scoring feasible.
Reviews score, managers manage
The reason Deloitte has team leaders fill out quantitative feedback about their team is because the organization needs a way to score and differentiate employees across the organization. This data can then be used for promotion and compensation decisions.
Deloitte does not use their structured reviews as a way to force team leaders to manage their team. Effectively managing the team is left up to the manager.
Netflix is not the only organization going its own way. These days most great organizations are thinking critically about performance management and coming up with innovative new solutions. Here are a few more examples to help inspire your own strategy.
And if you're ready to take the next step, check out our guide to creating your own modern performance management process.