In the last two years we’ve helped a number of organizations implement performance management systems that do not have ratings. Our employee surveys have consistently determined that both managers and employees prefer not to use ratings. They’re seen as an impediment to two-way communication and good productive dialogue and can lead to conflict and disagreements.
Why? People don’t want to be labelled. Behavior and performance is complex and it’s difficult to place into a rating category. Interpretations and subjective biases further complicate matters – managers and employers can arrive at different conclusions about performance.
The alternative is a fulsome written description or assessment of how the person is performing. The lack of ratings does not mean that there is no accountability. Honest and frank conversations still happen, just without ratings.
Traditionally, the need for ratings has often been driven by the goals of reward and compensation. These are laudable goals and even without ratings, compensation decisions can be made during talent reviews where performance is a key variable discussed in determining reward. Others variables include the person’s potential to take on more responsibility, adherence to culture norms, how the person does relative to others, and so on.
For us, the primary purpose of performance management is to help the employee be the best they can be. Every feature of the performance management process should be designed to achieve (and not detract from) this outcome.
Is your performance management system working for or against your goals?
Click here to learn more about how Kwela can assist with performance management system design and to get our Whitepaper on performance management best practices.
And click here for information on our Coaching for Performance training that builds the essential performance management skills.
Nic Tsangarakis, Principal