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Delightful Performance Reviews: How To Run Modern, 360 Review Cycles

What is the point of performance reviews? Are they really needed? And why are they frequently so bad?

Some top companies such as GE, Adobe, Gap, Deloitte, Accenture and Microsoft have been getting attention for cutting their traditional annual performance review and ranking process. Performance reviews are not relics of the past, though.

Instead, leading companies are shifting to create a “feedback culture” involving both ongoing and fluid feedback systems, as well as more structured, comprehensive processes.

Modern, 360˚ reviews play an essential role in building a meaningful feedback framework. They drive performance and support employees in their growth and development.

What Makes a Good Performance Review?

Essential Review Elements

A good performance review happens more frequently than just annually, involves more perspectives than a single manager’s, and is development-focused and forward looking rather than just assessment focused and backward-looking. Review cycles can then be complemented by other feedback processes throughout the year.

More Frequent

A good performance review process will happen semi-annually or quarterly, depending on company needs. It is tough to feel motivated in December for feedback one has gained last January. Semi-annual or quarterly reviews are often enough to ensure feedback is given in a relevant timeframe. More frequent periods also allows easier comparison and learning about performance over time.

More Perspectives

Employees interact with a diversity of people at a company. Although managers review  employee work, others also often have valuable perspectives to share. Employees themselves also have insight on their own strengths and weaknesses. Expand reviews to 360˚, and open up new learnings.

Peer Review

Have employees reviewed by one or members from their team or neighbouring team. The more perspectives on an employee’s performance, the easier it is to grasp where the employee really is, not just where the manager thinks they are. Additionally, involving peers mitigates any bias a manager might have, and helps highlight contributions a manager might overlook.

Self-Review

Self-review helps compare and giving context to a team and manager’s review of an employee, with the employee’s own thinking. It also a valuable tool for the employee to reflect on their own performance, how they view their skills, and what they want to improve upon. Employees can better understand their strengths by matching up their self-perspective with external perspectives.

Manager Review

Apart from the manager reviewing the employee, good performance reviews go both ways. Give employees a chance to provide feedback to their managers.

Development Focused

Reviews are a great opportunity to help employees and managers develop. This opportunity is lost if a review is simply seen as an assessment or scorecard. Instead, frame reviews as an intentional way to pause and ask where the employee currently is in regards to performance, skills, and development, and where they need to and want to be.

Cultivate a greater development focus by:
  • Including more development-focused questions in reviews
  • Separating talks focused on salary and compensation from talks about development
  • Having managers and employees sit down to discuss reviews, with good preparation ahead of time
  • Setting up a goal framework to support the employee in setting development objectives, and breaking down concrete steps to reach those objectives
  • Complementing bi-annual or quarterly reviews with smaller, more ongoing development-oriented feedback processes
  • Working to establish a feedback and growth oriented culture

Complemented

Performance Reviews work best when complemented by other measures, such as

Continuous Feedback

Processes that allow frequent formal and informal feedback on an ongoing basis. For example, after an employee gives a presentation, they might check in with their team to ask about their preparation and presentation skills.

Manager Coaching, Check-ins and 1:1 Meetings

Regular sit-downs between managers and employees. The focus is coaching and improvement. Three questions to ask to prepare regular 1:1 Meetings could be: What are key achievements from the last week? What are next steps for the next week? What are current issues or requests for support?

Surveys

Regular surveys on topics such as e.g., engagement, manager support or development opportunities help to leverage honest and timely feedback from employees. These can be short surveys with just a few questions, sent regularly, or longer and sent out only a few times a year.  


Do Performance Reviews Still Matter?

Good Reviews = High Motivation and Engagement

Surveys by leading US research firm ProClinical found that across the US, Europe, and Asia, more frequent reviews (ex, monthly) made employees almost 60% more motivated, 67% more likely to recommend their company as a place to work, and over 50% more likely to be working there in a years’ time.

High Motivation and Engagement = Performance and Retention

According to Gallup, organizations with higher than average levels of employee engagement see 27% higher profits and 50% higher sales.

The Harvard Business Review found engaged employees have 31% higher productivity, and 37% higher sales.

Reforming Reviews

Bad performance management practices do need to change, but that doesn’t mean performance reviews should be done away with completely.

Modern, 360˚ performance reviews are a powerful tool when implemented alongside everyday continuous feedback, and meaningful coaching and 1:1 meetings with managers.



The ROI of Performance Reviews

Studies show 70% of employees are unhappy with their current performance review process. There is a lot of potential for positive growth!


Good performance reviews increase employee motivation and engagement, which drive performance, growth, and retention.

Honest Feedback = High Motivation and Engagement


Correcting a Bad Track Record

Performance reviews have not always been a positive force within companies. Traditionally, many reviews have emphasized financial rewards and punishments. This diminishes internal motivation and learning.

Traditional reviews also often award rankings based on a “curve” where only a certain number could be called “excellent,” and a certain fixed number must be labeled “low performers.”

These measures increase competition between employees, rather than collaboration. They create a mindset focused on avoiding failure, rather than embracing growth.

Why reduce 2000 hours of annual work into one number without providing a clear path to development potential, and hurt learning and motivation? There needs to be a better way - and there is.


Modern Reviews: A Better Way

Performance Review Wingmen:
Manager 1:1s and Continuous Feedback

Performance reviews do not stand alone. They fulfill their role best when they are integrated in a culture of feedback and growth orientation, and complemented by ongoing feedback and 1:1 meetings with managers.

This frequent feedback is needed to avoid recency bias and give specific feedback at the time when people need it. It also provides small, ongoing points of positive encouragement, and future-focused improvement.

Being able to review continuous feedback provided over the past months also simplifies providing feedback to an employee, peer or manager when performance reviews are due.  

Good learning environments have a back and forth exchange between learners and teachers. They balance ongoing feedback, with regular check-ins, and then comprehensive reviews. Work is a learning environment. Why shouldn’t it be the same?

Why Can’t the Wingmen Stand Alone?

Ongoing feedback is essential, and some would argue that a semi-annual or quarterly review is unnecessary if good ongoing processes exist.

However, performance reviews give a structured, bigger-picture view outside the scope of smaller, ongoing feedback. Both scales are needed.

Performance reviews create a structured time to take a break and fully reflect, gaining a deeper understanding of where they are at.

Combined with ongoing feedback, employees can then continually finetune their progress.

Case Study: Google Reinvents the Performance Review

Google Reinvents the Performance Review

Google has one of the most dedicated and innovative human resources (or, as they call it, People Operations) teams in the world.  After years of trial and error, surveying, and testing, they concluded this: performance reviews still matter. Here’s how Google implements them.

Semi-Annually

Google does reviews twice a year: Once a highly comprehensive review that happens once a year in November, and then a mid-year check-in on that review six months later in March or April.

360 Degrees

Employees review themselves, each other, and their manager, and managers review direct reports. Managers have full access to all feedback, including non-anonymized peer reviews. Individuals see only anonymized peer review results.

What Google Measures

Quantitative
  • “Googliness”: metrics that align with Google’s values
  • Problem solving: How well people’s skills align with addressing work situations
  • Leadership: Demonstrating initiative and resourcefulness
  • Presence: How well people communicate and make themselves heard

Qualitative

  • Strengths:
    What to keep doing
  • Weaknesses:
    What to work on
  • Comments on contributions to specific projects

Contributions

  • How well the employee achieved company and project goals, ex, according to Google’s Objectives and Key Results (OKRs).  

Putting It All Together

After seeing peer and self assessments, and taking into account employee contributions on OKRs, managers draft ratings for their own employees. These are not final, however. Groups of managers then gather to “calibrate” ratings.

This reduces bias, as managers have to justify their decisions to one another. Shared responsibility also takes the pressure off of individual managers to assign high reviews.

Results

After finalizing a performance review, managers sit down for two separate conversations with employees. One is development and learning focused. The next, one month later, is promotion and compensation focused.

Google knows it is hard for employees to be in a intrinsically motivated, development-focused mindset at the same time that extrinsic rewards are on the table. So they seperate the conversations.


How to Run a Modern, Elegant Performance Review

A great review cycle will:

  • Give employees insight on their performance from an all-around, 360˚ perspectives
  • Provide larger, structured feedback for employees. This contextualizes and frames the other pieces of feedback they received from manager 1:1s and continuous feedback processes
  • Highlight both strengths and areas for improvement with specific insights on how  they can improve
  • Provide trends to the company on overall performance, and core competencies
  • Remove employee anxiety over performance ratings, by clearly communicating that the performance reviews is about development, and compensation discussions will happen separately. (Ideally, one month later).
  • Go two ways, and allow managers to gain feedback from their employees too


Prepare

  • Look at your overall feedback process: what could be adjusted in terms of performance reviews, continuous feedback, manager 1:1s, and regular surveys?
  • Build buy-in with  the HR team,  executives, and with managers
  • Investigate tools and processes to use, and set up trainings to support people in effectively using them
  • Decide what type of reviews you want to run: Just manager-employee, or include peers up to a full 360°? If including peers, will the peer reviewers be in the same team, from another team, or both? Is everyone in the company being reviewed, or only some groups?
  • Decide what competencies reviewees will receive feedback on, what scale will be used and what questions will be asked on top of competency feedback.
  • Clarify to everyone how the reviews will be used: are they only development focused? Will they be used for compensation at all? If so, how?

Run

  • Roll out on a regular basis, i.e semi-annually or even quarterly.
  • Provide both employees and managers with tools and resources to get the most out of the review process
  • Facilitate manager-employee conversations! Written feedback is only half the process. Use managers or others as coaches for future-focused development.

Follow Up

  • Ask for feedback on the process, and optimize.
  • Keep providing ongoing support on feedback skills and processes.

Compensation

Companies may be tempted by traditional, ranking-based reviews because they want a simple basis for promotion and compensation. It is time to let go of that thinking, however.

Compensation might be informed by - among other factors - the outcome of performance reviews. However, those talks should always be clearly separated, preferably by a time period of at least one month.

By themselves, individual performance reviews are not the best way to determine compensation. For more guidance on frameworks for fair compensation, check out Google’s re:Work guide.  


The Nitty-Gritty Details

Best Practices

Grounded in Theory and Practice

Leapsome has developed best practices for questions that are grounded in both scientific frameworks, and real world experience.

We draw from field sources like Google’s public re:Work platform, and academic sources like Harvard University’s Program on Survey Research.

You can read more of Leapsome’s best practice questions here.

Question Types

Skills and Values

Define your the skills and values your company prioritizes (“company skills”). Then, choose questions that target those skills and values. Companies can then track performance on these skills and values over time.

Common vs. Specific

Some questions will be common no matter who the reviewer is: ex, quantitative questions on company skills. Others, you may want to be specific based on who the reviewer is: ex, qualitative questions.

Quantitative Questions

Quantitative survey questions should ask questions that can be objectively assessed. Leapsome recommends a five-point scale.

Example skills:

  • Drive Innovation, Deliver Results, Prioritize Effectively

Example Questions

  • Drive Innovation: Thinks out of the box and contributes new ideas
  • Deliver Results: Consistently gets things done and delivers convincing results
  • Prioritize Effectively: Focuses on the most relevant priorities

Qualitative Questions

Self-Assessment

  • What are your three biggest achievements since the last review?
  • What are the three biggest challenges that you are currently facing?
  • What do you consider your three core strengths?
  • What is/ are your one to three key learning & development goal/s?
  • What support do you need by whom to move forward on your development goals?

Qualitative Questions

Manager to Employee, or Employee to Manager

  • What do you consider his / her biggest achievement since the last review?
  • What should he / she keep doing?
  • What should he / she change?
  • What is the most important development goal that he / she should be working on?

Peer to Peer

  • What do you appreciate  most about him / her? What are you thankful for?
  • What should he / she keep doing?
  • What should he / she change?
  • What support could you offer to him / her to further develop in his / her role?


Who Should Review Who? Who Should See What Feedback? When?

Deciding who should review who can be tough to navigate, but it doesn’t have to be. This choice is highly customizable in Leapsome, and the Leapsome Customer Success Team is there to advise.


Who Should Review Who?

Option 1: Managers appoint peer reviewers

Pro: Managers have insight into the strengths of their reports, and can assign reviewers who make sense

Con: Managers may know less than employees about who would benefit most from what reviewer


Option 2: Employees nominate what peers they want to be reviewed by

*This option then includes manager confirmation

Pro: Employees can select those peers who know their work best, and have the most to add

Con: If employees feel pressured to achieve good results, or think their peer’s rating strongly affects their compensation, they may select peers they think will review them more favourably. However the manager confirmation step accounts for this.

Who Should See What Feedback?

Option 1: Managers can see all reviews, with name

Pro: Managers have greater context into feedback given, and thus greater insight

Con: Managers may elevate or dismiss feedback based on their opinion of reviewer

Option 2: Managers can see anonymized reviews only

Pro: Managers are not biased by who the reviewer is

Con: Managers may still make assumptions of reviewer identity, and managers cannot follow up  for additional context

Option 3: Reviewee can see peer reviews, with name

Pro: Individual has greater context into their feedback, can follow up

Con: May impact relationship if employee is hurt by feedback

Option 4: Reviewee  can see anonymized peer reviews only

Pro: No risk of damaged relationships

Con: Employees may still make assumptions of reviewer identity, especially in small teams, and cannot follow up  for additional context

When Should People See Feedback?

Option 1: Managers can see completed self and peer reviews only after writing the employee’s review

Pro: Managers opinion not overly swayed by others’ positive or negative reviews

Con: Managers may miss points or build on or gaps to fill, sparked by seeing others’ reviews, Managers can integrate peer feedback and put it into perspective

Option 2: Managers can see completed self and peer reviews while writing the employee’s review

Pro: Manager can build on employee’s self and peer reviews, gaining new perspectives, complimenting points or filling gaps

Con: Manager’s opinion and review may be overly swayed by positive or negative reviews


Tools and Resources

Leapsome

Google re:Work

Harvard Business Review

Deloitte

Berkeley Human Resources



Completely modular + Multi-language

A modular platform that's got you covered

360° Performance Reviews

Save time with automated 360s and employee-centric performance reviews

SMART goals & OKRs

Align your company around objectives and key results or SMART goals

Engagement Surveys

Run anonymous pulse surveys to understand your employees and make better decisions

Continuous Feedback

Enable continuous feedback and praise  to boost employee learning

1:1 Meetings

Provide guidance for better meetings between managers and employees

Integrations

Integrate Leapsome with your favorite tools: Personio, BambooHR, Slack+ more