Employee Performance Reviews Do More Harm Than Good

I don't think this is necessarily true. I realize most employers aren't like this, but my boss does a very good job of politely and clearly telling me what he expects of me and what I can expect from him. Our performance reviews are always positive experiences, and I leave with specific goals to accomplish before the next review: sometimes goals to improve my job performance, sometimes goals to improve myself. Instead of focussing just on a bonus or pay increase, it's basically a reconciliation of "what would you like from us", and "what we would like from you".<p>I think if more employers looked at it this way, and were more casual and open about the whole process, it would be a lot more beneficial to their companies.

My girlfriend is a Ph.D. student in industrial organizational psychology. She had this to say:<p>I think this view is unnecessarily extreme. I think the correct way it should have been presented is that performance reviews should be done in a more useful way. Not all performance reviews are for the purpose of rationalizing bonuses. I think feedback on one's performance accompanied with goal setting of specific behaviors is fundamental in sustaining good work and motivation in employees.<p>I do think that ranking employees doesn't work most of the time because it not only creates competition but discourages those who have been performing well, but just not so much as others who could potentially be ass-kissers as what the article says.<p>The bottom line is that , w/o a review/feedback on your on-going performance, you wouldn't have an idea of what you should work towards to and u cant assume that all employees are intrinsically motivated to do better.<p>Heuristically, people lose their sense of engagement about 5 months after they are hired and this can keep deteriorating if immediate supervisors don't provide the support/encouragement/feedback.<p>One last thing, research has repeatedly shown that regular performance feedback increases motivation and performance in the long-run. what's important really is how the feedback is given.

In my experience employee reviews are typically de-motivational. My employer has me rate my team members on a scale from 1 to 6 on a variety of work related criteria. The basis for getting a raise rests on the employees ability to increase their ratings on a review to review period. It's horrible (and I've told them I think so).<p>The entire ratings system is ripe to be exploited by people who know how to play the game. <i>This is especially bad if non-technical people are reviewing technical people.</i> I had to witness the worst developer on my team become the highest paid because he knew how to sell himself and could speak a language that upper management understood.<p>I'm more in favor of (arguably) less subjective methods of determining an employees worth (like Bioware's RPG style ratings, or Joel Spolsky's ladder). There's still room for person bias, but at least there's <i>less</i> room.

Unfortunately, at least in the U.S., unless there's some kind of formal &#38; documented evaluation process for compensation, they're opening themselves up to a whole host of potential lawsuits.<p>One useful strategy we've had is to do 90 day (quarterly) quickie evaluations followed by a formal, but succinct, annual review. If both parties are doing their jobs, "pathway/goal" guidance given informally during the quarterly process and throughout the year should lead to very little surprises in the annual review.

What blows my mind is that no company I have worked at has ever set performance goals on day 1. It doesn't make sense. We set goals at annual reviews so why not on day 1? Why blindside an employee during the first annual review?<p>I talk to everyone on my team 3 times a year to make sure I'm giving them what they need from me and vice versa. The informal manner helps in keeping the whole process relaxed and the feedback genuine. The 4 month period in between gives ample time to improve things without stretching it out for a whole year. Iterate, get feedback, iterate, get feedback. It works for startup business plans so why wouldn't it work for self development?

Employee performance reviews that enforce an arbitrary curve-based ranking or grading system often to do more harm than good.<p>I have seen employees who have performed well all year get demolished by a performance review where they were rated a "3" or "4" out of "5" because HR required only one "5" per department and two or three "4"s, and expect the majority of employees to be a "3". (Thankfully, they didn't require that each department designate a "1" goat.)<p>That being said, I have found that performance reviews that focus on how the employee has improved the business and seized opportunities (or not) and focus less on artificial competition are extremely beneficial.

The last company I worked for had these '360' performance reviews where you get reviewed by a few coworkers as well as your boss. Also there was no money involved. I thought it worked really well. While you'd hope your coworkers would give you pointers on how you could improve throughout the year, realistically, shyer developers won't do that, and this gives them the opportunity to do so (mostly) anonymously.

I once worked with a manager who was very up front about using performance reviews to retaliate against any subordinate who crossed her. Luckily she wasn't my boss.

If you eliminate performance reviews altogether, and issues rewards as team rewards, why would top performers (the ones who might regularly bank 7-15% raises instead of 2-4% raises) stay with your company for the rock-steady, everyone-gets-5% return, when they can go somewhere else and make meaningfully more money?<p>It seems that the socialist (not tarring, just naming) approach to granting team raises is a powerful attraction to low performers.<p>In a small startup, with relatively little money to throw around, it probably doesn't matter and eliminating them may actually be a net win. Once the company reaches the 500+ person mark, failing to recognize ($$) individual achievement just demotivates and chases away those who would be your stars.

Presumably the author here is drawing a distinction between performance reviews and development reviews? It seems like it's quite a good thing to review how a developer is getting on regularly, and find out what things they'd like to do more of and how they could develop their skills, without it being tied to bonus distribution.

This article feels like it was taken out of 7 Habits - Think Win/Win. Recurring performance reviews certainly cause unnecessary competition and fear among employees, breaking up their "team" ability. I just wish the article had addressed the deeper question of how to tell an employee they're doing poorly without such a review.