Why We Fail at Grading Our Workers

The annual performance review at most employers is dreaded by workers and supervisors alike. Common complaints about the performance review process are that it is prone to bias, it doesn’t motivate workers, and it does not effectively raise overall performance. Human resources and company executives need to reassess their performance review process to ensure it is not predictable or biased in terms of the key performance indicators used. Eugene Chang, senior principal at Korn Ferry, explains: “The conventional performance management system is often touted as best practice – this is because the large American corporations, seen as best in the world, first adopted them and made them popular.” Typical review processes also can take months to complete depending on how much back and forth there is between supervisors, workers, and HR. Chang adds, “The conventional performance management system was meant for an industrialized world. Today’s world has shifted from command and control to innovation and agility.” The performance review process needs to fit the agile needs of changing businesses, or it could demotivate employees and productivity could suffer, especially among millennial workers. Younger employees have grown up in a digital environment where feedback is immediate, and in some cases where there are smaller teams, all members may be equally excellent but the forced bell curve pushes one to the top with larger rewards and one to the bottom where there are none. Chang adds that the use of a bell curve also removes transparency and could cover up poor management practices. Systems that are in real-time and more individualized can more easily provide feedback to employees and leverage strengths on an ongoing basis, such as the one developed by Deloitte. More frequent check-ins with workers also ensure employees remain motivated and on track.

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