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Building a Better Review Process

Marcus-Buckingham.jpgBy John Scorza

It’s no secret that almost no one is happy with the performance review process—certainly not employees or supervisors and probably not many HR professionals. Marcus Buckingham isn’t a fan of performance reviews either. They’re biased and backward-looking, says Buckingham, a New York Times best-selling author and founder and chairman of the Marcus Buckingham Company.

Instead, the process should focus on the present and the future and how to get the best performance from each team member.
I recently spoke with Buckingham, who is scheduled to address the SHRM Annual Conference & Exposition in Las Vegas later this month, and he shared some valuable insights for HR professionals.

What’s wrong with performance ratings?

We do not seem to understand how much it hurts our profession when we provide performance-ratings data or 360-degree data to our operational colleagues on the board and they say, “Is this data reliable? Does a 3 mean a 3? Does a 5 mean a 5? Do these ratings really reflect performance?” In HR, we tend to say, “Well, uh, yeah, I think so,” because of this whole process of measuring competencies and calibration sessions. But, in fact, those ratings data are all falsely precise—they’re all bad data. They’re garbage.

What’s wrong with the data?

It’s bad data because of the idiosyncratic rater effect. Basically, that means that, if I rate you on anything—performance, potential, promotability, empathy, strategic thinking—between 61 and 62 percent of my rating of you is a function of me as the rater, not you as the person being evaluated. So my rating of you reveals more about me than it does about you. And yet our entire approach to talent management—who we pay, what we pay, who we promote, what we train—is based on the assumption that my rating of you is reflective of you. But it isn’t. It’s all based on bad data, and everyone sort of knows it. And that’s a huge problem.

How can HR best help team leaders get the most out of their teams?

People are productive right now in spite of the systems and practices of HR rather than because of them. So HR has to adopt tools and systems that add speed and insight to what the best team leaders actually do. We’ve studied the best team leaders, and they seem to understand that what employees really want is coaching attention. Don’t give me feedback. Don’t tell me where I stand. I want to know how to get better. Coach me right now. Help me get better next week.

Marcus Buckingham, @mwbuckingham on Twitter, is the author of several best-selling books. His latest is StandOut: The Groundbreaking New Strengths Assessment from the Leader of the Strengths Revolution (Thomas Nelson, 2011).

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