1. Quit giving ratings
2. Decouple salary and bonus from performance
Pay people fair based on market rates. Everybody in the organization play an important part in achieving the goals – and if they don’t, move them to a job where they do, or let them leave. The high performer can only do her stuff, when back office is supporting. Shift focus from pay to purpose, and from individual profit-optimization to collaboration and team performance.
3. Give regular feedback
Feedback should be given every time a task or a sprint is done, orally and/or in writing. Create a culture, where it is natural to both give and ask for feedback. Every PowerPoint presentation, workshop or any other kind of deliverable your employee is responsible for, should be rounded of with a few words. That means daily or at least weekly feedback. In agile projects weekly feedback sessions are already common (the retrospective).
4. Ask the organization
To capture what your employees are doing on projects and other types of tasks that may not be visible to you as manager, ask around, and perform regularly 360ᵒ evaluations, including all relevant stakeholders. Use this input as supplement to the personal feedback.
As an example, I have met companies, where they once a year ask everybody to (anonymously) give feedback on everybody using points. Each person have 1 point for every employee and can give one person all the points, or everyone 1 point. This highlights the ‘hidden’ high performers, and sees through the ones only managing upwards.
5. Handle poor performance instantly
Do not wait to handle low performance. Deal with it when you spot it, and handle it as part of the regular feedback. Find the best way to facilitate and counsel, based on the employee and the situation.
6. Talent management
Most managers knows who their talents are, without having to rate them beforehand; so build a separate process for this. Use also the input from the 360ᵒ feedback to discover any hidden talents.
7. Have moving targets
Keeping the strategic direction for the organization is as important as knowing the overall purpose; but how we get there should be flexible and adaptive to the changing environment. Set and reset targets on quarterly basis, keeping alignment with the overall direction.
8. Focus on the meaning
Make sure that the individual targets are meaningful for you and for the employee. Working on tasks that makes sense and have a meaning gives high motivation – and opposite: working on tasks that does not makes sense, is one of the major motivation killers, and why people leaves companies.
Having said that, there is no one-size fits all in this. Every company have to find their own pace and way forward, and what work in some organizations, may not work in yours.
Find inspiration in this way of combining the books Unboss and Drive >>
What we normally advice is, that when the management team collectively have taken the informed decision to scrap performance reviews, you start experimenting with the different elements in performance leadership, and continuously adjust and evaluate it along the way.
Remember, performance leadership is about people, culture, commitment, and enablement.