Tuesday Dispatch: #119 - Performance Management
Tuesday Dispatch: #119 - Performance Management
Performance management cannot be avoided, so better do it properly!
Performance management is a scary topic.
For many people, it means that HR is taking steps toward fixing someone's performance for the better. Some companies have in place PIPs, which stand for Performance Improvement Plans, but they do not always work as intended.
Performance management is a broader topic than this, and when performance management is done right, PIPs, disciplinary actions, and terminations do not actually happen.
I take this even further: when performance management leads to disciplinary actions, terminations, silent firing, etc., it blatantly demonstrates a lack of leadership.
The core foundation of performance management, in my experience, comes down to being able to compile effective performance reviews.
Performance Reviews Demystified
Many organizations implement a performance review process at a systematic level. Every six months or a year, they require their managers to file an official review of the people they are supposed to manage.
I don't want you to look at performance reviews from that point of view.
The perspective I want you to consider is broader and way more interesting.
Let's get to it.
My take on performance reviews starts from the foundations: who they do serve and how.
The subject (aka the employee)
A good performance review helps the employee understand how they contribute to the overall organization, how their work is instrumental in achieving common success, which areas they should improve going forward, and how to achieve such improvement.
The outcome of a good performance review is a clear path forward regarding individual behaviors, responsibilities, actions, and skills.
The actor (aka the manager)
When leaders implement a structured practice of reviewing performance, they will be forced to dedicate hours (or days) to looking into their people's work.
This alone is a valuable experience. I have seen many leaders who were convinced they knew everything about their team, goals, and business just because they worked together daily. But in reality, they did not understand the fundamental aspects of the talent they were supposed to lead because they never took the time to deeply analyze what was happening under the hood at a human level.
A good practice of reviewing performance surfaces behaviors, expertise, and issues that sometimes are not so apparent. Behaviors that are fine when taken in isolation suddenly reveal themselves as problematic when observed over a longer period of time because they define toxic patterns.
As a manager, take a performance review just like any other check-up. A check-up is an unpleasant waste of time if you are not sick. But we all know that serious illnesses can be prevented only with a regular habit of screening and check-ups.
The institution (aka the company)
When a company needs to understand how it's leveraging the talent it has invested in, it cannot avoid systematically implementing some review. It can be delegated to HR, people managers, or more aseptic metrics, but it cannot be avoided. At some point, you need to know who works well and who doesn't.
When the need for workforce documentation is the only reason behind performance reviews, we get the dreaded reality that performance management is just the early sign of layoffs, toxic expectations, and sudden pressure from the top.
This is why, regardless of admitting this specific need for performance documentation that companies have, I strongly recommend first approaching performance reviews for the employees’ and managers’ benefit.
So, what's the difference from a regular culture of feedback established in the team?
Two things:
Performance reviews are positionally aware: feedback comes from every direction(if you listen to it effectively), while performance reviews come from your manager.
Performance reviews are systematic, while regular feedback is situational. Feedback loops should be short and refer to recent atomic events. Performance reviews refer to longer periods of time and take into consideration repeated behaviors and habits. If feedback sessions address exceptions, performance reviews address the ordinary.
How I conducted regular performance reviews as a Director Of Product Engineering
My process was refined over a few years of iterations and tested on dozens of people in a distributed environment. It's designed to be document-based and async. With minimal adaptation, it can be applied to any type of organization.
It's based on these principles:
Self-review: the subject is asked to self-assess their performance. This assessment is done async, requested via email, and is to be completed over a period of 10 calendar days. This self-assessment's quality, precision, and punctuality will greatly inform the final review.
Manager's review: it's a review I would compile based on all the information I collected in the last few months, which included a body of notes I carefully collected over time. All the outcomes of the one-on-ones I conducted with the subject. Public praise, criticism, and feedback could be found in the open. All the outcomes of all the projects the subject had been involved with, and all the previous reviews from past managers, eventually.
No Surprises rule: performance reviews do not admit any element of surprise. Every single piece of information in my review has been discussed in previous feedback sessions, one-on-ones, and meetings. If something surprises anyone, I'm not managing people properly.
The final review is a concert, not a judgment. The final document must be agreed upon and signed by both parties equally. As much as I have the ultimate responsibility as a manager, I would never file a review that has not been discussed and agreed upon by the subject. The review will be documented and explained if there is an unsolvable disagreement. (It actually never happened to me in more than five years).
My self-review template
Dear XXX,
please answer these questions by YYYY-MM-DD (10 days from now):
- Three things you are proud of, that you have done succesfull in the last period. Please include context, your contribution, and the final impact, referring to any online resource that would help me better understand.
- Two things you would like to improve in the coming period.
- One ways I can help you grow in your current or future role.
One more thing: how do you see yourself in a year from now?
The integration, discussion, and final filing
This self-review would then inform and be integrated into my manager's review, shared with the subject, and discussed in a dedicated one-on-one meeting.
Once we both were confident and comfortable with the final performance review, I would submit it to HR for the final filing.
I would also attach the unedited self-review to the document.
Additional Resources
To Build a Top Performing Team, Ask for 85% Effort
It is often assumed that "maximum effort = maximum results"; however, research has demonstrated that this is not the case. The 85% rule, which suggests that maximum output is achieved by refraining from giving maximum effort, is a more effective approach.
Check out this great article on building performing teams.
How Many Direct Reports Should a Manager Have?
In my experience, I'd say:
With 1 to 4 direct reports, you can manage people and still have the bandwidth for executive contribution.
With 4 to 8 direct reports, you can manage the team, but it's a full-time endeavor.
With 8 to 12 direct reports, you must manage people full-time and optimize your management processes. Automate scheduling, standardize performance reviews, delegate fearlessly, etc.
Over 12 direct reports: your effectiveness starts to decline quickly.
Similar results are more extensively shared in this great article; don't miss it!
The Dunning-Kruger Effect
People often have an inflated perception of their skills in various social and intellectual areas. The authors of this article argue that this overconfidence partly stems from the fact that unskilled individuals face a double challenge: they not only make wrong decisions and choices, but their lack of skill prevents them from recognizing their mistakes.
In four studies, the authors discovered that participants with the lowest scores in humor, grammar, and logic tests greatly overrated their performance and skills. Even though their scores placed them in the 12th percentile, they believed they were in the 62nd. The authors found a connection between this misjudgment and a lack of metacognitive skill, which is the ability to tell right from wrong. Participants could see their limitations better when they improved their skills and metacognitive competence.
Wrapping up
My process was designed to guarantee that my performance management served the subject first, the actor second, and the institution third. It was intentional and deliberate.
If we approach performance management in the opposite order of priority, it becomes witch-hunting: people assume there is a problem and won't stop looking for it until they find one, even when they must make it up.
I always wanted to manage performance more modernly, compassionate, and effectively, supporting people in their career progression.
I truly hope you can do the same.