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Wednesday, October 22, 2008

Punished by the Annual Performance Review

Many of us in the Agile community have voice our opposition to the individual performance reviews and target setting.
Now, a professor from the University of California, Los Angeles (UCLA) has come out with a similar position and not less than in the serious
Wall Street Journal (copy of the article), yes, the same that your CEO religiously reads every morning in the 5 star hotels where he "lives" -- there's hope he read this article.

Professor Culbert goes on to say that annual performance reviews are not only counter-productive, they are immoral. He says it best:

I believe it's immoral to maintain the facade that annual pay and performance reviews lead to corporate improvement, when it's clear they lead to more bogus activities than valid ones. Instead of energizing individuals, they are dispiriting and create cynicism. Instead of stimulating corporate effectiveness, they lead to just-in-case and cover-your-behind activities that reduce the amount of time that could be put to productive use. Instead of promoting directness, honesty and candor, they stimulate inauthentic conversations in which people cast self-interested pursuits as essential company activities.

He goes on to say that the manager's job and responsibility is to enable and promote the employee's performance, not to "punish" it:

The boss's assignment is to guide, coach, tutor, provide oversight and generally do whatever is required to assist a subordinate to perform successfully. That's why I claim that the boss-direct report team should be held jointly accountable for the quality of work the subordinate performs. I'm sick and tired of hearing about subordinates who fail and get fired, while bosses, whose job it was to ensure subordinate effectiveness, get promoted and receive raises in pay.

Here are some of the dysfunctions that the annual performance review cause:
  • They harm teamwork
  • The "objective" nature is completely fake objectivity
  • They create adversarial relationships between employee and manager
  • Pay for "performance" is really market-driven pay (or raises) in disguise
  • They impede personal development
How about you? What have been your experiences with the annual performance review? Write it up on the comments.

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  • In scrum, the sprint is passed only when the goals are met. Similarly, a story is done only when all of it done and you do not have to continue or revisit it. It is not possible to meet these very high standards without the concerted effort of the whole team.

    We do not make claims like: "We met 78% of the goal and it is all thanks to this part of the team and they can be rewarded but that other part of the team was lazy and cannot be rewarded."

    How would you come up with a reliable way to measure the degree of meeting the goal and reliably assigning the reward and blame? And you would probably spend a lot of effort doing it.

    It it much easier to make a binary judgement: goal is either met or it is not met. And rather than assigning blame, think of ways to improve.

    Some manager may think they need to have individual performance reviews because some team members may be performing better and some worse.

    That would be like having an engine that does not fire on all cylinders. Who would think they can improve the engine by rewarding the cylinders that fire.

    I think the better course of action is to stop expecting the firing cylinders to improve and instead fix the dead cylinders.

    Unlike a stupid engine block that is unable to think and change itself, the team is composed of people who can talk about problems and try to come up with ways to improve.

    Maybe there are some cylinders who have personal or domestic problems distracting them at work? (I don't know a quick fix for that.)

    Maybe there are cylinders who have trouble getting up to speed because they do not yet see how their input will help the team achieve something great.

    Maybe they do not think the thing they are working on is such a great thing? (This must be one of the things that makes open-source software so great: the contributors have personal interest in the software and its improvement. They are also the people who use the software.)

    Some of us are not motivated by intellectual challenge alone. Or even by monetary rewards.

    Open-source software developers get their reward by being recognized by their peers. I wonder if any manager has ever tried to use that as a reward?

    By Blogger sti, at October 24, 2008 12:53 AM  

  • Great comment Sami!

    Do you have any experience with "rewarding by peer recognition" where you are?

    By Blogger Unknown, at December 05, 2008 3:01 PM  

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