Crowdsourcing the performance review

Traditional performance reviews are never fun – and not terribly effective
By Chris French
|Canadian HR Reporter|Last Updated: 01/28/2014

Early in my career, I became familiar with the term “single point of failure” — a part of a system that, if it fails, will bring the entire system to a halt. Most companies deliver performance reviews rooted in just that: A single point of failure. The belief that a fair and accurate performance review can be delivered by one manager once per year is, unfortunately, not quite true.

No manager, no matter how closely she works with her team, has the time to accurately capture and record all the information necessary to give a truly comprehensive performance review.

What’s worse, some managers come to the table with pre-existing biases — both positive and negative — that can colour their view of a direct report.

The limitations of a single manager’s point of view represent a single point of failure that can hold back an employee’s growth (or conversely, lead to a promotion beyond his capabilities). In turn, this misuse of human resources can damage an entire organization.

Fortunately, modern technologies and changes in the way human beings interact and gather information are creating a better solution: The “crowdsourced” performance review.

Crowdsourcing is widely understood as the gathering of information from many personalized, open and transparent sources — think Yelp, Angie’s List or TripAdvisor. Just as a diverse selection of feedback from fellow travellers, homeowners or diners provides, in aggregate, a clear and accurate overall perception of an experience, feedback from all of an employee’s peers provides a better source for employee evaluation and recognition than a single manager’s viewpoint.

The ability to review and consult the data provided by crowdsourcing gives managers a much larger (and much less subjective) data set to draw on when evaluating performance. This increased level of detail leads to more accurate performance reviews that are more motivating for employees, yield better performances and generate more overall workplace happiness.

Let’s take a look at how crowdsourced performance reviews work.

Social recognition programs

At the core of the crowdsourced performance review is the software that powers a “social recognition program.” It provides real-time performance data for every employee in an organization. One of the advantages is the information generated can be searched retroactively (unlike verbal employee-to-employee recognition).

That means that just as social media watchers mine for information — such as terms that were trending during a given event — managers can retroactively go over the data and see which employees received the most positive recognition from their peers during a given project — in other words, it identifies the “trending” employees.

When the time comes for annual performance reviews, managers can dig into this enormous cache of data and use it to inform their conclusions about their direct reports. Instead of having to rely solely on their own subjective points of view, they can cross-reference their perspectives with hard data provided by the employee’s co-workers.

This not only removes the single point of failure but improves performance reviews across the board.

Motivation and performance

Because performance reviews take up such a small part of an employee’s time at the office, one might think that working so hard to improve them isn’t a good use of resources.

But 83 per cent of employees who are satisfied with their reviews are also satisfied with their jobs overall (versus only 55 per cent for those dissatisfied), according to the 2013 SHRM/Globoforce Employee Recognition Survey.

This correlation shouldn’t be ignored. It’s common knowledge that satisfied employees are more motivated, more productive and less likely to leave for another job — and clearly satisfaction with performance reviews plays an important role in their overall happiness.

This is where the company culture part of a social recognition system comes in. Beyond improving periodic performance reviews, social recognition systems also help create what Globoforce CEO and author Eric Mosley calls a “positivity dominated workplace.”

When employees understand their greatest potential for reward comes not from impressing their boss but from regularly earning recognition from their peers, they’re automatically incentivized to work as a team.

The rewards system is no longer based solely on the small portion of an employee’s work that her boss directly observes, but the constant feedback of her teammates.

The result is a workforce that is always looking for ways to leave a positive impression and help out their peers — because they know their boss will be using co-worker feedback to inform their performance review. Additionally, social recognition systems provide a stream of real-time public appreciation for employees.

While this may seem unimportant, it’s actually critical to employee motivation — fully 88 per cent of employees who receive regular peer feedback are satisfied with their jobs, found the Globoforce survey of more than 800 HR leaders and practitioners.

Fixing the review

Despite the significant level of innovation that’s occurred around compensation and recognition over the past few decades, performance reviews have remained relatively stagnant.

Crowdsourced reviews offer the possibility to change performance reviews from a single-source, once-a-year ritual into a real-time stream of positive feedback powered by a social recognition system, improving employee morale, productivity and overall satisfaction.

The world is evolving around the performance review — it’s time the review caught up.

Chris French is vice-president of customer success at employee recognition provider Globoforce in Toronto. He can be reached at chris.french@globoforce.com or, for more information, visit www.globoforce.com.

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