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Improve Performance: Eliminate the Performance Review

By Bill Cushard

It is difficult to find someone who will say they have had a good experience during an annual performance review process. Go ahead, ask one of your colleagues right now. Whether it is a manager or a front-line professional, most people will say the process is painful, an interruption, and not a valuable use of time. Samuel Culbert and Lawrence Rout, authors of the book Get Rid of the Performance Review, call performance reviews "a pretentious, bogus practice that produces absolutely nothing that any thinking executive should call a corporate plus." I was going to say that.

Performance reviews are intended to be a process during which people can have a performance discussion with a manager about what development is needed and to know where one stands. Instead, these reviews end up destroying employee morale and killing the bottom line.

Think about how annual performance reviews are conducted. Every December, managers must write down what they think of the job people are doing based on several competencies or goals that they do not remember setting a year ago. Then, managers must try to remember how people performed in relation to those competencies and goals nine, ten, and eleven months ago. Believe me, managers dread this. And the quality of most reviews shows it. What's worse is that since the manager cannot remember how someone performed ten or eleven months ago, the annual reviews end up being about the stuff that happened in the past few weeks. Bad, I know, but it gets worse. People who are receiving these reviews feel like the process is being "done to them" rather than an open, two-way conversation about how to grow and develop. Painful. 

So, if it is so painful, valueless, and "a pretentious, bogus, practice that produces nothing," why don't organizations stop doing it?

At Allonhill, we wanted to put an end to this bogus practice. Not that we are particular geniuses, but we know there must be a better way. To find that better way, we did not ask, "How can we improve the performance review process?" We asked, "How can we create an environment in which people could always know where they stand and what they need to do to improve, grow, and develop?" We thought that if we could answer that question, even partially, we could enable a group of people who would and could achieve great things for our clients.

So, when we first embarked on this mission to abolish the annual review, the first thing that happened was that our HR director almost fainted. Once he recovered, we asked more questions. What if we could eliminate the annual performance review process entirely? What if our people could be in charge of their own performance, request feedback from anyone in the company, and make behavior changes on the spot based on that feedback? How much better would people perform? How much happier would they be? And how much bureaucrazy (not a typo) could we eliminate from the system? The possibilities are enormous and have huge implications for working smarter and performing for our clients at a much higher level. 

We take great pride in our mission to bring credibility and transparency back to the mortgage industry. Accordingly, we are channeling this passion into bringing credibility and transparency back to how we manage our people in the interest of creating an environment in which people are continuously improving performance by seeking feedback and adjusting behavior in the moment of need. We are changing the game. Instead of trying to improve an existing process, we are creating an entirely new way of engaging our people in meaningful discussions about performance and career growth. It fits our mission, our culture, and our way of working.

What could have a greater impact on performance and client satisfaction than that?


Performance Reviews

The content in these thoughts shows the reason why Allonhill is rated so highly in Forbes Magazine, The Denver Biz Journal, and many others. They are turning their heads and noticing the continued innovative, cutting-edge thinking that occurs here. Bill, you have drawn out into the open one of the most dreaded farces in any work environment: the annual performance review. To get rid it it entirely would be a relief for both managers and employees alike. These kinds of positive transformational changes will be a boost for workplaces everywhere. People will naturally perform better when they are honored and recognized day-to-day,improving their own performance day to day, rather than dreading being judged in a one-time review. Keep up the creative and innovative thinking, Bill!

The New Workplace- Great Idea

This is a great idea, I think this company is really on to something. Asking the probing questions is key to a progressive and sustainable growth margins and company success. Yes, I do believe those that do well need acknowledgment and those who are falling short need to be made aware, lets face we all want raises. I believe this company is illustrating a shift in the paradigm of working culture. This simple notion is not just a out of the box innovation but refreshes the gravity of the workplace as a whole- amazing! Transparency in the Financial Sector is and should be a hands down no brainer, but the current workplace culture subscribes to what they are told instead of what is possible. With some key benchmarks, targets and standards established and set into place this could really be a successful venture for this company and the employees as well.

-It’s not a secret employees do their best when their happy. Way to go forth and challenge the status quo!!!!

Benefit's Manager's More than Employees

I don't know about you, but I never had a problem with my performance reviews. I welcome them. I want to know that my manager notices my efforts and what I need to do to improve and get to where I want to be in my career. From my experience, it is the MANAGER'S that dred these reviews. Most don't seem to like to do them and it really highlights what they "know" or "don't know" about YOU. Also, a manager cannot possibly perform a quality performance review if they don't even know how to do your job...This is a WONDERFUL idea, for THEM...not for everyone else...and yes, I agree with the prior posts, that it is no more than a popularity contest among peers, cause really, when I'm truly focused and doing my job, I don't have time nor do I notice what everyone else is doing...

Just say'n...

Performance Review Process Reduces Performance...and Morale

I just had a conversation today with someone about this very subject. He just completed his review scoring a C+ (along with every one else in his department) at a well-known aerospace company in Waterton Canyon. The key irritant for my apparently "average" friend was knowing the purpose was to justify everyone getting the same raise. Additionally, there was no feedback or hint of suggestion for improved performance. Nor are there any opportunities for growth. Simply put, this annual exercise was a farse and a waste of everyones' time, and ultimately left a bad feeling all around.

Kudos to Mr. Cushard for boldly stating what most managers are thinking but never want to go on record for saying!

I LIKE IT! I can't wait to

I LIKE IT! I can't wait to see how this develops.

Eliminate the Performance Review

Amen to what Bill is saying. I couldn't agree more.

OK What is it then?

That sounds cool but really what will be the differece? Would you establish some general benchmark or standard or goals that we measure ourself against? Would this process if done by peer review/feedback turn into a popularity contest? Shall I make agreements with my friends to give eachother good reviews? Really the best solution is to do self performance reviews and let us decide on our own raises, you know the on your honor system, right?

This is an awesome blog.

This is an awesome blog. Employees need to know how they are reviewed on a regular basis. This is truly thinking outside of the box and more managers should truly understand that the relationship is mostly person to person in which case, people have feelings, need acceptance, need to know if they are doing an exceptional job, need consistent feedback and need to know the direction that the company and/or business is moving in. The vision, mission and goals should be continually shared. There should not be inconsistencies as it relates to the goals of the company. All employees should be on one accord. IF there are changes, then those changes should be implemented in one place so old and new employees are able to understand and realize what the individual, team and management goals are. Thanks Bill.

Amen to this blog! My

Amen to this blog!

My thought is that it takes Managers being involved with their employees in order to accomplish this goal. Mine has none with no communication what-so-ever unless it is generated by our team members. Sad but true. Perhaps this would be a good start!

Love it, great thinking out of the box!