The Future of Work Part 1 - Being High Performing Versus The Performance Review

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This blog series is a triptych on alternatives that disrupt traditional Human Resource methods with concepts that move us towards the Future of Work. 

 

It’s 2018 and Agile working has become the new Way of Working. Once considered the territory of the reckless and sloppy, now most of the free world is considering how they can implement these better ways of working into their teams and orgs. The rest already have. Roles that were once the domain of Project and Program Managers are now inhabited by Scrum Masters and Release Train Engineers, where there were Requirements Documents are now User Stories and Cards, where there were Epic Software Fails there are now incremental releases of customer centric products. The software world can heave a sigh of relief, most ridiculous notions of how to create high quality software products are gone, we are pretty good now. 

 

But there remain trappings of the traditional, top down and tool-obsessed inside even the most agile and progressive organisations. Inside Human Resources departments are draconian methods from the 60’s to 80’s that we just can’t seem to shake. Friends, join with me to light a fire under these outmoded ideas, best relegated to the wood veneered board rooms of the past and implement alternatives that compliment our modern ways of working so much better.  

 

OK, so your team is granted authority to work Agile. You break your work into chunks, you employ user stories, you prioritise work and communicate daily using Stands ups. You Retro faithfully every Friday and your team has some autonomy on selecting and executing work. Everything your team produces is coming up roses when it’s delivered to the world, but something smells wrong, badly wrong, once or twice a year. It’s the moment when HR starts to send bulk communications in advance of what can only be described as the worst kind of organisational waste ever concocted. The Performance Review. 

"something smells wrong, badly wrong, once or twice a year"

 

Initially it’s the people leaders who are advised of the timetable of events, with a tone of ‘Of course you would have set SMART goals for your people many months ago, so start having those performance conversations now!’ in a series of dry procedural emails.  You’re schooled to start measuring your people and have those good hard thinks about where they are on a scale of ‘Dirge' to 'Awesome’ or to put it more politely ‘Development Needed' to 'High Performer’. A set of arbitrary dates are released, it’s all worked back from a point when payroll need to coordinate a mother-load of bonus payments (minus super and tax) into our patient workers bank accounts.  You’re invited to mandatory internal education sessions about how to fill in the various forms in the various systems and how to have ‘difficult conversations’, you’re shown where the tissues are kept. The measuring and ranking has begun. 

 

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Great managers may mutter about how this is a bit awful, and embark on their own internal struggle, in an attempt to square for themselves a process antithetical to everything they believe is important in leading and motivating amazing teams of people. They try to fudge things so it really IS fair and just. Believe me I’ve searched time and again in many of my people leadership roles to find some sense or humanity that can be employed when buckling down to these Performance Review charades, but it’s pointless searching for the upside - there isn’t one. 

 

I don’t blame HR people, these archaic practices have way too much momentum to be overcome by lonely voices. Objections are handled with “We’ve always done it this way”, “This is how HR are rolling out their performance review process, you were consulted earlier in the year in a People Leaders session you were invited to” these kind of messages leave me confused like I haven’t been paying attention, probably because it sounds exactly like the kind of session I would have avoided. Other objections are met with “How will we decide and pay the bonus if we don’t go through this performance measurement system?” and worse "How do you measure performance if not by this process?" Bleurk. 

 

I worked as a leader of a large engineering team at a great digital company. I had a leadership team of my own, which incidentally is worse, when you have to look your crew of people-leading skeptics in the eye and talk them through how The Performance Review process is going to run like you are a supporter of it! My team had already done the logic and the maths and had decided en masse to subvert the system. “Yeah we just decide everyone’s a 3” so in the de-humanising activity of rating individuals by number from a 1 (dirge) to 5 (awesome) they all decided to remove their participation from the program and rate everyone the same. I was surprised, and impressed by the commitment to their comrades, but to them it was simple, even at the highest salary bracket a rating of 4 (almost awesome) would get you approximately $1,400 more in your bank account after tax than a 3 (just ok), it simply wasn’t worth a year of hard slog and sucking up to your manager to bag a 4. Technologists are really fast at creating salary models to run through bonus scenarios.

 

The humiliation of being labelled “just ok” rather than “almost awesome’ was stomached because they considered delivering software (which is what they worked on daily with each other) was a team event . When I pointed out that the rest of the company would be doing the hoop jumping and KPI fudging to get their individuals 4’s and 5’s, they changed their tune. That’s when things turned to crap and I longed for the good old socialist days of "everyone's a three".

 

Another great company I worked in had a technology community that reacted rather loudly on internal blogs and Slack channels about the Performance Review Process, to the degree that the executive team did some soul searching and held open feedback sessions with people leaders.  They definitely heard the objections, even though they couldn’t quite grok why people would object to such a bonus systems and performance measurement - not a technologist among them.  Unfortunately it resulted in the answer  "It’s too late to change it now, but…GREAT convo Yeah! Let’s keep that convo happening!” I wonder if they did? Apparently their process is even more corporate now. When you've come from other large corporates that have all landed on this lowest common denominator of measuring performance, I agree it seems like the only way. 

 

Why are practitioners of Agile ways of working more allergic to this traditional approach than ever? Traditionalists enquire “But how else can we know people are performing? How can we measure people and know they are working? How do we weed out the slackers and reward the 'above and beyonds'?”  Agile people sadly shake their heads and murmur  “You are asking the wrong question”. 

 

What are all the things that are wrong about traditional Performance Review Processes that have agillists like me so rankled?

In a nutshell:

 

It’s a large batch size

 

Lean and agile approaches abhor large batch sizes. Large batches hide opportunities for feedback, they hide defects, they reduce the ability to measure throughput and hide opportunities to make things better - including making the process itself better. Performance Review once or twice a year is a HUGE batch size. Think about how much variety is in your work in a six month period, you have amazing days and terrible days. How would you reflect and create more amazing days if you only had feedback after 178 days! What a wasted opportunity. 

 

It’s not humane

 

Reducing people to numbers that are parsed through a money distributing sausage machine must be the most inhumane of all the people processes one is subjected to in a company. Sure, it’s not quite sewing a star onto a uniform designating your lowly rank - but it’s not very far off. I think we can only believe it’s an ok thing to do until it happens to us, and this is where the attempting-to-do-good middle manager feels the most anguish: the requirement they have to label everyone with a number which they do so in good faith, and then the humiliation they feel when they realise that they too are just a number on a spreadsheet after all. “It’s about the conversation not the number!” Traditionalists will protest. Sure. But try and NOT fill in the number on the spreadsheet and you’ll soon find out - it’s about the number.

Not to mention the trust and confidence that is eroded when you are told to go and get 'constructive feedback' from people who you know don't like you.  

Agilists believe in individuals and interactions OVER processes and tools. Performance Review is a process that puts the care for the individual last. 

 

It’s highly subjective

 

Agilists love to measure and learn, they don’t want an opinion about whether a product WILL perform well when they deliver it, they want a metric that they can track to PROVE it has.

 

Technologists simply won’t buy your arguments that you have found the right metric which can measure a developer. By what? Lines of code? - No! In fact many will believe that the least lines of code is better. But no, hang on a minute, less lines of code isn’t better if no one else can understand or maintain them, it’s worse! What about lack of defects? Sure, now we are getting somewhere, but often defects are caused by events and people up or down stream of your code, and actually all our code may be created by pair programming between two developers that rotate regularly in the team, so trying to track that won’t work either.

 

What about throughput and cycle time? Ta da! Finally something agilists like. How many things did you deliver (throughput)? How quickly did each little thing get through your pipe (cycle time)? But ahem, sorry, these are all TEAM efforts, they are the result of high collaboration and the whole team working together on a well honed product and pipeline process that's desired by the customer and timely. It’s impossible to rank individuals in these complex collaborative systems without applying some kind of bias or subjectivity, which is open to abuse by sucking up to your manager, or manager abuse by playing favourites.  These kind of subjective influencing approaches naturally favour your more political workers, but do not inherently result in high performance or good outcomes. 

 

It’s top down and that doesn’t work

 

Applying goals and objectives at two occasions during a year, from the highest management as a ‘trickling down’ of company objectives is a top down construct that leaves little room for the inspirational learning moments and growth of teams and individuals in their system of work. If that sounds a little high falutin' it’s because this approach and attitude has massive consequences for organisational performance. 

 

For example, a company sets it’s goals for the year, the management team breaks that into smaller goals, they are dealt out to the various organisational teams - who have authority to use agile approaches - who then break their own work down. These goals are further broken down by people leaders to hand to their people, and now as well as the individual having to be the best darn developer they can for the next six months, we add on ‘deliver X and Y project as per company goal’ too. Well, on the plus side there's finally something concrete with a metric they can deliver to achieve a bonus in six months, except this whole idea is premised on a system that doesn't change. If you learn something dramatic about the world or a competitor or the market and pivot in that time, you’ll have missed your goal. So at best, you might pivot successfully and then your individual goals will be wrong, at worst the top down element of this approach to goals will be adhered to, you’ll miss the pivot to make your goal and your company performance will be affected.  

 

This is why so many Performance Reviews wind up with leaders muttering ‘well you didn’t really do that one, but you did this one instead’. Why on this green earth do we pretend that top down goal setting and planning works when as agilists we KNOW that adaptive plans are the only tools that work in a rapidly changing world? 

 

Traditionalists might suggest that you update your goals at many intervals during the year, if you know of anyone that’s done this please send them my way, in twenty years I haven’t met anyone who has. 

 

It doesn’t pass the sniff test

 

Because of the above listed reasons Performance Reviews for individuals in Agile teams never pass the steely traps of logical minds you encounter in technology teams. If during Performance Review time you try and sell the ‘up-side’ of having some ‘great conversation’ around performance with your people, they will likely look sideways at you for not making that a regular part of your gig as their manager. If you admit that it’s a charade and you’re doing your best to get through it with minimal work then you might be met with horror that you’re peddling a clearly corruptible system to access bonus money for people.  

 

It’s time to do better with our HR processes, it’s time to replace The Performance Review with Being High Performing. But how might we do what Performance Reviews attempt to do, in an Agile friendly way?

 

Well here are a few of my ideas that I’m hoping you will help to ignite. 

 

Small batches

 

Agilists love small batches, little items that are easy to progress and complete.  Applying this principle to the concept of Being High Performing would look like breaking the activity down into smaller more frequent activities. 

 

Does that mean we’d be doing the dread Performance Review every month instead of twice a year? This is not at all what I’m suggesting, instead I think we should find ways of breaking the topic of Being High Performing into bite size chunks. What if your performance was critically assessed on a daily basis, ie at the level where you can say whether you’ve had a good or bad day and digest and understand what have been the contributing factors? 

 

Iterative and Incremental

 

As well as breaking work down to achieve small batches we tend to use the nature of iterations to go over and over things, improving them as we go. What if you collected your performance in very small batches, and then very frequently you reflected on this? What would you find out about yourself and your abilities at Being High Performing with an iterative approach? Imagine how could you increment Being High Performing continuously with all of those opportunities for reflection and learning. 

 

A well used phrase “At the end of the day…” implies that literally at the end of a working day you take stock of all factors and make a conclusion. Why not rate our own Performance and make observations at the end of every day in a small and simple way?  I’m talking an investment of a few seconds a day. 

 

Transparent

 

We value openess and transparency when we work in teams, in fact we strive for it, to be open and transparent as a team means we work rapidly through challenges, find issues quicker, learn from errors rather than cover stuff up. 

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What would that look like applied to Being High Performing and in small batches iterating this constantly? Perhaps we could have our own indicator of our performance, how we think we are doing at our job as a performing team member, and make that open to all? Perhaps we could have the kind of environment where we would invite feedback on how we were doing and also invite assistance for those times when we’re struggling? 

 

Writing this and feeling slightly squirmy tells me this would be the toughest part of a more agile Being High Performing approach. Thinking about team mates being able to critique performance and give their opinion on how others are doing would require extreme levels of trust, but I hope it would also expose extreme levels of disfunction in the wider system that we could tackle too.

 

For example, if someone external to me observed that I appeared to be struggling with some outward communication from the team and gave me a ‘Red Traffic light’ rating on my performance that would be an indicator that I better do something about that. If a team member observed that I appeared overly busy in meetings with no time for the team and gave me an ‘Amber Traffic Light’ on the time I devoted to supporting others  then I would know that I'm missing stuff, as well as time to reflect and learn from my mistakes too - I’d better address that if it’s the broader system that’s impinging on my leadership time. As confronting as it seems I think I would prefer this quicker more direct route to improvement above waiting six months to hear it while the team suffers. 

 

Collaborative

 

We understand that great products come from great teams, and that great teams have strong collaboration, trust and transparency. Why do we insist on Performance Reviews to still be centred on individual achievement, when so much achievement is the work of a collective not an individual? If we want teams to master collaboration then we better start rewarding that behaviour instead of pretending that Being High Performing works as an individual pursuit. 

 

If we can apply transparency to the rating of Being High Performing in small batches iteratively, we are effectively collaborating on becoming High Performing. I see this as a necessary and virtuous circle that’s at the centre of a more agile approach. It follows then that we should rate ourselves as teams on our abilities to be collaborative also. There are many team based metrics already commonly tracked, such as team Happiness, Throughput and Cycle time (already mentioned) and whatever metric your product is chasing: be it Revenue, Reduced Risk, Customer Satisfaction etc. it’s not a tall order for the team to add Collaboration to their set of regular monitoring and to be assessing it as a High Performing metric. For example, a reflection once an iteration such as “On a scale of 1-5, are we collaborating well as a team?” Would be straightforward to track. 

 

Bottom up - go to the source

 

There’s nothing more disempowering than to receive an edict from on high that you despise like a Performance Review process. Conversely it's hugely empowering to control your own destiny. 

 

I know proposing an alternative system for Being High Performing better not take up more management time than the old one, or it will whither and die. Perhaps we can achieve an empowering route to Being High Performing by putting it in the hands of those impacted? What if You, the individual, committed to recording your performance in small batches, checking in with the team transparently and reflecting on it iteratively with your line manager at your regular catch ups? Since regular catch ups are happening anyway (I hope!) this should be no more intrusive to that time spent. 

 

Since we value the humans in the system we should allow you to use the freedom of choice: coloured markers, a software tool, or any particular rating system you choose to track and monitor your own performance. You could write a journal daily, or use an app, importantly it should be your choice. Since you make your own Being High Performing transparent to the team you will have the natural accountability and feedback loop to truly own this activity, and it ultimately benefits you, so my theory is - you will want to do it. 

 

This approach means that you can never centralise your Being High Performing activities into an HR tool, an added benefit! No money wasted on useless systems, rolling out process or Big Brother style oversight. If you want to know about an individual's performance you’ll have it transparently reflected always, and with the guidance offered by your team and manager given at very frequent intervals in small increments there’ll be no need to suspect that bias is at play. 

 

So these are my initial ideas for alternatives to The Performance Review that help us achieve Being High Performing instead.  I wrote this because I'm motivated to find an answer to 'If not the Performance Review process then what?' I know what you are thinking, that’s all very nice in theory but will it work in practice? I’m thinking the exact same thing, that’s why, Friends, I’m on the look out for courageous teams and organisations that want to embrace and try some of these ideas. I want to help us move on from traditional HR approaches that simply don’t work for our collaborative and agile ways of working, and create new ones that do!

 

Get in touch if you are willing to be a Guinea Pig team and test these ideas, or have objections as to why you think aspects of it won’t work. I am committed to working through these so the Future of Work is a better place for people.  And please keep us updated if you're inspired to start this in your team, I'd love to hear the results in practice! 

 

Tune in next time when we deconstruct the Position Description and talk about why it’s no longer relevant for the Future of Work.