Today we are going to talk about something uncomfortable but essential, the Annual Performance Review!
It is a complicated and delicate task we have to perform as a team here at Venturit. We have been following traditional models for the last ten years. We figured out the traditional model didn't fit us since we are an agile team, and teammates move around groups during the year, and managers cannot possibly remember everything at the end of the cycle. We are trying to be careful here; actually, it doesn't fit any form of a team.
Here is a quick history:
We started with the textbook model of the annual review, where we gave a questionnaire to the team member, and the manager reviewed the answers and gave the observations. As you know, this is a critical process to ensure that team members know how the management views their performance and how they value it. The review is performed before the annual increment, and naturally, everyone wants to reach the maximum increase. We even tried 360-degree performance reviews in the last two years of those ten years. While it gave some flexibility and transparency, it still didn't solve our problem.
How can we make the performance review process agile and straightforward? Let it be out; performing annual performance reviews using traditional textbook methods is not practical and constructive; everyone hates it. Most of the time, both parties, the reviewer and the reviewee, end up leaving unhappy because it is not possible to remember or keep track of all the things that happened throughout the year. This approach leads to strain and disagreements. We had a situation where some members were leaving happy, and some were crying during the performance.
Naturally keeping track of ones' full-year performance is challenging. It would help if you had frequent performance communications to avoid the end of the year strains. Also, having only the supervisor doing the review could lead to issues of unfairness or favoritism. You may try to avoid this by introducing a 360-degree performance review. But, 360-degree reviews lead to other problems, where people think they might not get a fair review if the colleague reviewing them has a strained relationship with them.
These are some of the challenges we faced, and there were many more concerns we had to address during the years, including the years we had a 360-degree review. In our opinion, performance reviews should be agile, transparent, and straightforward.
Yes, we need to have the flexibility to address different types of personalities such as extraverts and introverts, and different mindsets such as growth and fixed mindsets. We need all these characteristics in our teams to ensure we strive as a team.
We understand giving frequent constructive feedback helps a teammate adjust his or her performance. We also recognize that Maslow's "Hierarchy of Needs" model is still valid today. We need to use incentives to motivate and reinforce us as humans to achieve psychological and self-fulfillment needs once our basic needs are satisfied.
Considering ten years of efforts to adopt what other companies are using, we decided to build a Performance Management system that can be transparent, straightforward, trustworthy, and provide feedback as frequently as you like. Just like our agile project management process. We named this system “Strive”.
Strive is a gamified performance review system to help our team members strive. Strive replaces our current 360-degree performance review system by integrating essential elements of the 360-degree system and using gamification to deliver feedback on a biweekly basis so that teammates can Strive faster.
We decided to make Strive software open-source under an MIT License so that you can use Strive to implement a better performance review system for your team as well. Using our experience in our ed-tech, we design Strive to use a badging system to recognize and reward team members frequently. The badges are given every two weeks, they are rewarded under four categories Solver, Trustworthy and Reliable, Venturian, and Expert.
These categories are brought forward from our 360-degree performance review system, they show under what performance categories we are reviewing our teammates. You can set up your own if you decide to use our system. Our performance categories are;
Solver: Solves problems, both simple and complex, demonstrate attention to detail, critical thinking, decision-making, and researching skills.
Trustworthy and Reliable: Follows through on commitments, even when tempted to walk away.
Venturian: Adheres to Venturit values; fairness, respect, care, honesty, and team spirit.
Expert: Demonstrates extensive knowledge or ability in the work domain.
A fun fact; If you haven’t noticed above, we derived the name “Strive“ using the above performance categories Solver, Trustworthy and Reliable, Venturian and Expert (STRIVE)
In Strive, we have four types of badges: Bronze, Silver, Gold, and Platinum. They behave like typical levels of a game. Under each performance category, we offer badges to indicate a teammate’s performance.
Bronze: If you receive a bronze that means you meet expectations and each bronze is worth $5 of rewards you can cash out. If you get 3 bronze in the same category you will get elevated to a Silver badge.
Silver: If you receive a silver that means you exceeded expectations and each silver is worth $20 of rewards you can cash out. If you get 3 silver in the same category you will get elevated to a Gold badge.
Gold: If you receive gold that means you strongly exceeded expectations and each gold is worth $75 of rewards you can cash out. If you get 2 gold in the same category you will get elevated to a Platinum badge.
Platinum: If you receive platinum that means you are a superb teammate and each platinum is worth $200 of rewards you can cash out. The Platinum badge is the highest level in our badging system.
Who can Award Badges?:
We included this feature to improve fairness and reduce strains. You can customize, who can award badges, and under what category.
Teammates: Any teammate can award a Bronze badge to any other teammate for being: Trustworthy and Reliable, A Solver, or a Venturian during the biweekly badging period for the work they recognize.
Supervisor: Any supervisor can award a Bronze or Silver badge to any teammate for being: Trustworthy and Reliable, a Solver, an Expert and a Venturian during the biweekly badging period for the work they recognize.
Project Managers: Any Project Manager can award a Bronze or Silver badge to any teammate for being: Trustworthy and Reliable, a Solver, an Expert, and a Venturian during the biweekly badging period for the work they recognize.
Client Managers: Any Client Manager can award a Bronze or Silver badge to any teammate for being: Trustworthy and Reliable, a Solver, an Expert, and a Venturian during the biweekly badging period for the work they recognize.
Directors: Any Director can award a Bronze or Silver badge to any teammate for being: an Expert and a Venturian during the biweekly badging period for the work they recognize.
The system calculates the scores using the bronze badge count because that is the base for all badges. Each bronze is considered one point. The badges and points are valid for one year or until the next performance review period.
We have integrated the above rules to the Strive system as configuration parameters. If you decided to try out our Strive, you could configure them differently.
In addition to rules, you can request a badge for you or anyone else if you think you or your teammate deserves a badge. However, you will need a backer for this request to avoid "gaming the system."
The top 8 high performers are shown in the “Top eight list” which shuffles to avoid negative effects of “Forced ranking” (vitality curve) and Stack ranking. Others are shown as “Challengers” which is also shuffled.
With Strive now, we can review each team member's performance on a bi-weekly basis and provide constructive feedback to grow his or her abilities. Strive provides transparency by notifications and activity logs every time a team member is awarded a badge or has requested a badge. With this system, we hope the team member will know exactly where they stand and what adjustments they need to make to improve their performance to be above average.
We are currently using this system and we plan to write another blog post in three months to let you know how we are doing. Until then, you can enjoy staying engaged with us by reading blog posts on other topics, especially on AI.
Performance and Feedback Conversations, Harvard University, Available at https://www.youtube.com/watch?v=fKuPf4H34pU (Accessed: July 07, 2020).
Maslow's hierarchy of needs, Wikipedia, Available at https://en.wikipedia.org/wiki/Maslow's_hierarchy_of_needs (Accessed: July 07, 2020).
Coaching as Conversation, Harvard University, Available at https://hr.fas.harvard.edu/files/fas-hr/files/pm_conversations_managers_5.31.18.pdf?m=1527776833 (Accessed: July 07, 2020).
Strive, Venturit Inc. Available at https://github.com/venturit/strive (Accessed: July 07, 2020).