Archive | December 2012

Performance Reviews are Evil

My thoughts today are with the PMM process, which are due here at work by COB today. Whats a PMM? It stands for Performance Measurement and Management, and in a nutshell it’s your yearly review on how well you’ve performed your job relative to others who are your peers (even though they don’t do the same job you do).

There are many ways this process works … sometimes your manager reviews you and that’s that. Other companies, like mine, have you do a self-evaluation, force you to nominate one or two people (usually one peer and one client) to do a “360” evaluation of you, and then your manager takes your self review and the 360 evaluations, along with his own opinions, and gives you a final rating where you are stacked up against everyone else. Here we actually take it even further, where that review is taken to a “Management Circle” consisting of one or two mid-level to upper-level managers that you know, mixed in with some you don’t know and have never heard of, and they fight it out to see who gets the top rankings. Why? Because we rate our employees based on a bell curve. Let me explain.

The concept is that not everyone can be at the top, so for any given group (let’s say you 10 people) 10% get the highest rank, then 20% second highest, 40% fall into the middle, then 20% second from bottom and finally 10% in the hole. So bascially 1 person is best, 2 above average, 4 are average, 2 below average, and 1 is the worst and will likely get laid off.

Laid off?? Yes that’s right. Evaluations are supposed to be so that you can get promoted (and in fact that are strict rules about promotions too), but in my experience they are only really good at making people feel bad about themselves, and used for the most part to screen employees to figure out which ones should get laid off first in the next round of layoffs (there are a lot of those around here).

And not only that, but where I work, your yearly bonus is tied to your overall ranking too. Each group is given a bonus pool, and the people that rank at the top get the biggest piece of the pie, while those at the bottom get nothing. Yes nothing!

How’s that work? Well let me give you an example … You do your PMM and give yourself an above average review (2nd best). Your peers might even agree with you. But you don’t get along with your manager, so he rates you as average (that 40% on the bell curve). Then he takes you to the Management Circle (from above). Now at this circle each manager is bringing in his own people that have already been ranked, so if you have 4 managers with 10 people each, you now have to put those 40 people into the bell curve, so they are all going to fight for the top slots, and it gets very political. Other managers have people under them who worked on really big projects that year that had high visibility, so in fighting for the best ranks, some people get kicked down. So that person who ranked himself as 2nd best, and who’s manager put him at average, can now be kicked down to the lower 20% bracket, or below average, or even further all the way to the bottom, and now, even though relative to their peers they had a great (or even average year) they have to be worried that they are going to lose their job the next time layoffs happen.

Now I’ve never been a fan of these, and to give a little history, there was a man named William Edwards Deming, who anyone who has taken the ITIL or Six Sigma certifications is probably pretty aware of as they are based on many of his early theories , as many major corporations use a lot of his philosohy (such as Plan Do Check Act … or the Deming Circle). He also a list of what he called the Seven Deadly Diseases, and one of them is “Evaluation by performance, merit rating, or annual review of performance”. Deming felt that performance reviews “leave people bitter, crushed, bruised, battered, desolate, despondent, dejected, feeling inferior, some even depressed, unfit for work for weeks after receipt of rating, unable to comprehend why they are inferior”. I agree.

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