The AwkEng Rethinks Performance Reviews

Hi all,

Today's post is written in response to reading Andy Grove's High Output Management, and also shares some ideas of my own that the book helped me crystalize. Like Grove, I agree that most performance reviews processes are misunderstood and poorly utilized. Grove advocated for an improved process, while my take is a whole shift in mindset.

In short, I think an "exceeds, meets, does not meet" checkbox framework primes managers to think about their employees in the wrong way. Rather, the default expectation for managers should be that their employees are good. Managers should periodically give their employees the explicit feedback that they are a good employee and valued, forming a basis for trust and communication.

Overview of High Output Management (and Big Takeaways for Me)

First, I'll give an enthusiastic recommendation for reading High Output Management. It's obvious that Grove has thought deeply about the craft of management, especially middle management, and getting the best from people. Reviews describe this book as "all substance", and that's very true. It touches on lean manufacturing, meetings, training, matrix organizations, 1 on 1s, forecasting, performance reviews, and more.

The biggest takeaways for me personally were the ideas of management by output, and more importantly, how it leads to the idea of managerial leverage. Grove's view is that managers should be held responsible for the output of the organizations they hold influence over. At higher and higher levels of management, micromanaging and "meddling" become ineffective at increasing total output, so managers need to look for the most impactful ways to spend their time that scale to the entire org. Coaching other managers and providing training are two examples of high leverage activities, because these activities have a lasting, cumulative effect on a large number of people.

Overview of High Output Performance Reviews

Grove's take on the purpose of the annual reviews was that should be used to increase the employees' output. Good employees should be given feedback on how to get even better and find ways to leverage and scale their positive impact. Instead, good performers are often just told they're doing great, while poor performers are the only ones told how to improve.

The Default Should be Good

My take is that viewing your employees through a lens of "good performers" and "bad performers", is already thinking about your employees the wrong way.

That's because, much like doctors or Uber drivers, the base expectation for employees is that they are good. Hence the joke, "What do you call someone who graduates last in their class from med school? ... A doctor."

The joke works because the bar for graduating is high, and we expect that when we see any doctor, we can trust them to provide high quality care. Some doctors are certainly better than others, and there are some bad doctors out there, but that's the exception, not the rule. Similarly, when we step into a cab, or a Lyft, or an Uber, we expect our driver to get us safely and smoothly from point A to point B, and that's about all.

That's why I think putting an employee in a position for their boss to grade them as "exceeds", "meets", or "doesn't" meet expectations is fundamentally flawed. Everyone has strengths and weaknesses, which can be reviewed and coached, but starting from a position that your employees are good builds trust. And if an individual isn't a good employee, why are they still working for you? (More on this later.)

The Importance of Periodic Feedback

Of course, if you do have good employees that you value, you should tell them that! I bring this up, because the first time in my career that I heard the words "You're a [great employee] and I don't want to lose you, what can I do to get you to stay?" was after I gave notice of my intent to make an internal company transfer. I had no idea they thought about me that way.

I think the importance of that piece of feedback (with those explicit words) can't be understated. I've thought about it, and I don't think this can be dismissed as a Millennial craving for feedback and praise. I mean, I tell my wife literally every day that I love her, and why wouldn't I? On occasion, I also tell her that not only do I want to stay married, I want to be married specifically to her.

Clearly, a manager / employee relationship isn't a spousal one (Most of the time! Eeek!), but how else would your employees know they were valued, unless you told them? (If your answer is because you continue to pay them, what kind of toxic monster are you?)

Finally, when employees know that they are valued, it creates trust and a space for employees to both give and get candid feedback.

(Regarding asking for candid feedback: I often think that simple informational questions aren't enough. "What can I do for you?", might get a simple response. Questions that invite and give permission to imagine often lead to better insights, for example "What could you imagine leaving this company for?" or "Is this team as great as you'd like it to be?" This could be whole new post on asking the right questions, so I digress.)

What Happens If An Employee Isn't Good

The implication of periodically telling your employees that they are good, is that it also has to be the truth. If they aren't good employees, you shouldn't keep them.

That may sound harsher than it really is, but there's no other way to have a great team. Bad employees drag everyone down around them.

That doesn't mean you need to heartlessly fire people though. I haven't had the opportunity to reduce this to practice, but I believe there's an approach to talent evaluation and management rooted in honesty and professionalism that addresses the issue head on.

My Proposed Evaluation Framework

So my evaluation framework would look something like this:

  1. Top talent - Top talent should be identified and cultivated. Their direct manager, who is in a position to lose them if they move on to bigger and better things, should probably not be responsible for their career. (Top talent retention could be another blog post.)

  2. Good employee - You should tell them often that you value them and you don't want to lose them, because good employees are expensive to replace, (and also because you do value them and don't want to lose them!). Honesty breeds trust.

  3. Could be a good employee, but for someone else - You should straightforwardly tell the employee where they stand, and do everything in your power to help them find their next role. There should be an expectation of professionalism on both sides, and a reasonable time bound of 3-6 months. This is a far more mature outcome than hoping an employee turns things around before they become toxic, or worse, just lingers and stagnates.

  4. Bad employee - You have no choice, but for the good of the rest of the team except to fire them. This is hard, but necessary. Be human and provide as generous a severance as possible.

And of course, these evaluations and reviews should happen more often then annually. I imagine quarterly is about the right pace, although giving your employees meaningful performance feedback on a weekly basis, is probably best. The closest thing I've found to echoing these ideas is a Robert Glazer's "Mindful Transition" program which (surprise) reports positive outcomes when managers and employees have more open and honest conversations.

Closing Thoughts

Reflecting on my career, I think back on how often I've heard explicit, positive feedback or communication. Of course, I've reflected on the fact that maybe I'm not a valued employee, but I have a measure of self confidence to think that's not the case. I haven't heard much explicit negative feedback either, so I think it's more likely that there's an endemic lack of communication. Broad statistics on employee engagement and manager satisfaction make me think that's more likely to be the case.

But you don't have to be that way.

So if I haven't made it abundantly clear, talk to your employees! Honest, forthright communication, much like any relationship, is essential!

Lastly, I value you as readers. I read every message you all send me and respond to most. It makes me happy to know that there's an audience that hears what I have to say and that maybe I've had a positive influence in the world.

Best regards,
aka THE Awkward Engineer

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