How to conduct performance review calibrations

TL;DR: Performance reviews are an essential tool for giving feedback and encouraging continuous improvement. They provide a regular touchpoint for employees to understand what they’re doing well, and what they can work on. But it can be hard to get performance reviews right: 95% of managers are unhappy with the way their company conducts them. So what’s the key to making reviews work?

One crucial element is fairness. A McKinsey survey showed that more than half of employees who perceive their company’s performance management system as fair also think it’s effective. Unfortunately, unconscious bias from managers can undermine the fairness of reviews. And bias is a culture killer — employees who perceive it are nearly three times as likely to be disengaged and over three times as likely to plan on leaving their job within the year, according to data published in Forbes.

To ensure reviews are consistent, many companies turn to performance review calibrations. While calibration sessions take time and effort to coordinate, this process is key to eliminating bias in an organization.

What is a performance review calibration process? Why is it important, and how to conduct a performance review calibration?

“Calibration” means standardizing something or adjusting it precisely for a particular function. Maybe you’ve calibrated a thermometer, pH meter, or digital watch before. By calibrating an instrument, you can make sure the readings it’s giving you are correct.

The same concept can be applied to performance reviews. “Performance review calibration” means ensuring reviews are administered and graded fairly. But what does this mean in practice — how exactly can you calibrate performance reviews, and why is this necessary?

Ultimately, no matter how data-driven your performance review process is, there’s still an element of subjectivity. Certain managers will probably grade more leniently, while others will grade more strictly. For example, one manager may think most employees deserve a 5 (“excellent”), unless there are problems with their performance. On the other hand, another may think most employees deserve a 3 (“meets expectations”) unless their performance is truly exceptional.

While these variations in grading are expected and natural, they can create problems. Variations make it more difficult to develop a clear “big picture” of performance across your entire organization. They also open the door to bias: Are some managers giving better ratings to their personal favorites? Or giving harsher ratings to certain types of people?

“We had a woman who got some feedback because ‘she doesn’t speak up’ And the calibration team pushed back and said, ‘but are you setting up the right conditions for her, and are you listening?’ This led to a discussion around inclusion, bias, and stereotypes.
And that discussion was not being led by people ops, but by the managers.

The fact that we can highlight potential factors around ‘who tends to get heard and why’ outside a formal classroom — and then break that feedback down into something more concrete and useful to the manager — is very powerful.”

— Krystall Fierens-Lee, Chief People Experience Officer at Proxyclick

To ensure all employees are graded fairly, many companies choose to run a performance review calibration process to standardize review scores. Here’s how you can administer this process at your company.

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Wann Sie dieses Playbook verwenden sollten

When to use
this playbook

You can use this playbook at any time to progress towards your DEI (diversity, equity, and inclusion) goals by reducing unconscious bias. You can also use it while redesigning performance reviews — why not start integrating performance review calibrations into your process?

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Was Sie für dieses Playbook benötigen

What you’ll need for
this playbook

The right analytics tools

To calibrate performance reviews, you’ll need an easy way to compare reviews across different managers and teams. People enablement tools make this task a lot easier. For example, Leapsome allows you to see the big picture with visualizations like the heatmap and 9-box. You can also use it to easily calibrate performance review scores, keep track of who calibrated which score, and ensure employees see only the final scores.

Hinweise & Tipps
  • Calibrating performance reviews can be time-consuming. You may need to hold multiple calibration sessions with managers, HR staff, and/or external partners. Since performance review calibration is crucial for review accuracy, set aside enough time for meaningful discussions. 
  • Performance review calibration can help build trust among employees. Be sure to communicate to employees the steps you’re taking to ensure the review process is fair.
  • It may be frustrating for a manager to have their rating challenged. During the calibration committee meeting, the HR staff member’s job is to serve as a moderator and ensure everyone’s opinion is fairly heard.
  • Don’t worry if you see a lot of variation in ratings the first time you run the calibration process — this should improve over time. The calibration process will help develop shared expectations across each department.
  • During the calibration meeting, keep an eye out for outliers in the data. These may be an indicator of manager bias. 

How to run this People Ops Playbook:

Wie Sie dieses People Ops Playbook durchführen:

1. Decide on your approach to performance review calibration

When you begin designing your performance review calibration process, you’ll need to consider what you’re aiming to achieve and the best strategy to get there.

Does performance review calibration make you think of rating employees on a bell curve? Some companies choose to use this approach, also known as “forced ranking”. But forced ranking is controversial, and you’ll want to think carefully about whether it’s right for your organization.

Advocates of the bell curve claim it incentivizes employee performance and disincentivizes “too soft” grading by managers. This method forces managers to consider how employees stack up against one another, rather than succumbing to the temptation to rate everyone highly and avoid conflict.

But rating on a bell curve can create a culture of cut-throat competition. You risk frustrating employees, discouraging teamwork, and invoking accusations of unfairness — the exact thing you’re trying to avoid. For some teams, performance may not accurately fit the bell curve model. Perhaps all employees truly are five-star or one-star performers, and forced ranking would misrepresent their competencies.

Besides deciding whether or not to use forced ranking, you’ll need to consider if your current performance review system is effective. Ask yourself:

  • What does each number on the ranking mean? Is the phrasing we’re using to describe each number accurate (e.g., 1 = “needs improvement”)?
  • How will this data hold up during the performance review calibration process?

Once you’ve given these issues some thought, set up a meeting with relevant stakeholders and outline the goals you’d like to achieve with your performance review calibration process. Then, use these goals to create a set of standards you expect all managers to meet with their grading.

2. Plan out how your calibration sessions are going to work

After deciding on your preferred approach to performance review calibration, you’ll need to plan how your sessions will work from a practical standpoint. Depending on the size and structure of your organization, this process may involve HR staff, external partners, senior executives, mid-level managers, or a combination of these. All parties will need to meet as a group to calibrate employee scores.

There are a few different ways to run performance review calibration meetings. You could schedule individual 1:1 meetings between HR staff and managers. You could also create a calibration committee made up of multiple managers in a single business unit and led by an HR staff member. Whatever you choose, it should be based on a realistic assessment of your timeline and resources. Once you’ve determined what works best for your company, put this plan into writing.

“We do calibration via live discussion and minimize an asynchronous process.  That for us is more beneficial, but it means there is a high degree of coordination (scheduling), and discussions can run long if not well-facilitated and focused.

We could discuss everyone at length (and we love to say lots of positive things about people), but we also have to be efficient. So, over time, we’ve learned to focus more on individuals where there has been a change from the last cycle.” — Krystall Fierens-Lee

3. Have managers run performance reviews

Do you already have a pool of performance reviews ready to calibrate? If not, now is the time to check our playbook on running performance reviews and kick off review cycles. Make sure managers know what’s expected of them in terms of grading, particularly if you plan to use a forced ranking system.

If you’ve already run a performance review cycle, or if employees at your company are reviewed asynchronously, you can skip this step and go straight to the next.

4. Meet for calibration sessions

It’s now time to meet for calibration sessions. Go ahead and schedule your 1:1 or calibration committee meetings, based on the plan you created in step two.

“Essentially, I will sit with each functional management team to hear their first or second level calibration. Then I roll up all those discussions and share a summary with our executive team, including the CEO. And we discuss where there might be surprises, and we challenge the results that we have questions or doubts about.

My role is coordination, consistency, and of course, to participate in that calibration towards fairness and meritocracy.” — Krystall Fierens-Lee

5. Adjust performance ratings

Performance review calibration meetings are your opportunity to go over everyone’s ratings and adjust them together as a group.

During this process, you can use your people enablement software to get a big-picture overview of how managers are rating their employees. Work together to reach a consensus on how employees should be rated, then tweak your ratings to ensure all team members are being held to the same standards.

6. Communicate and share feedback with employees

The last step is to share the final, calibrated scores with employees. To avoid confusion, don’t share scores until performance review calibration is entirely finished. Managers should be prepared to explain their ratings and comments, and offer action items and next steps for each employee. At the end of the process, employees should clearly understand why they have received their ratings, what they are doing well, and how to improve.

Follow-up best practices for performance review calibrations

Continue to track employee performance over time

To ensure reviews remain fair and unbiased, continue to conduct performance review calibration meetings after each review cycle. This process should become easier over time, as managers become more familiar with review standards.

Calibrated performance review scores should give a good indicator of an employee’s progress at your company. Review scores can be used to make future decisions on compensations and promotion. However, you may want to separate compensation discussions from performance review talks, so that employees can focus fully on their professional development during the review process.

Keep managers up to speed on expectations

Remember those performance review guidelines you developed in step one? You may have already shared those with your managers; if not, be sure to do so now. Managers should be able to easily access and refer to these guidelines. Your managers may also benefit from continuous learning and DEI training to fight unconscious bias.

🚀 Performance reviews are crucial for employee success!

Check out our playbooks on how to write a performance review and how to run a leadership performance review. 😉

Make the most of performance reviews with Leapsome

Leapsome is the only platform that closes the loop between performance management, employee engagement, and learning.

Watch this video on review analytics to learn how to make the most of your performance reviews with Leapsome’s people enablement platform.

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Frequently Asked Questions

How often should I calibrate performance reviews?

We recommend you hold performance review calibration meetings after every review cycle. Depending on how your business is structured, these review cycles may be annual, biannual, or more frequent. Employees may be reviewed all at once, or at different times. The most important thing is to keep your performance review calibration process consistent.

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