Accenture will get rid of annual performance reviews and rankings
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Then the place got engulfed by this insane fad for "performance reviews", which is idiotic on its face for a number of reasons:
1. You request review feedback from peers - this is unworkable because if you work with someone who is useless, and you say so in their review, your working relationship with them becomes untenable;
2. The process also requires "self review", which is nothing but a mechanism for bullshitters to big themselves up. It is also time-consuming, and good people are generally too busy to dedicate much time to it; the bullshitters and timewasters otoh will happily dedicate days to polishing their lies and exaggerations;
3. In general the process massively favours those who play the performance review system, i.e. the politicians;
4. You are required to set "career objectives", which is almost entirely pointless since as a tech person you are largely constrained by what jobs need your skills at the particular moment you become available; there is little tolerance for people sitting around idle waiting for the perfect role that meets their desired objective.
The Accenture news was raised on an internal discussion about the review process almost immediately, as some people are that keen to get rid of the current way of doing things ASAP. Sadly, I can't see anything coming from it, as the word is that Upper Management values the generated metrics too much to change anything.
I work in same type of company, and it's pretty obvious how this and similar corporate cr*p clearly doesn't bring the best out of people, sometimes in contrary. If I would be owner/shareholder of any company, ever, first thing I would be concerned how incentives/bonuses for that extra mile/good work are being given. The higher the management, the more bonuses would be tied to long term progress (i know it's easier written than done, but i consider it at least partly responsible for financial turmoil of recent years too).
Also, by forcing a relative appraisal of each employees performance, you force managers to view employees with a more critical eye. If I were to simply have to answer, "did X do a good job on this project?", my answer would almost always be yes, absent any incentive to say no. But there are members of my team who deliver significantly better than others, so the calibration process forces me to find a way to put them above the team members who perform at a lower level. Getting rid of performance reviews would, from what I've seen, create a culture of "don't screw up" rather than one of taking risks and trying to do as well as possible.
As a manager who both received an annual performance review and delivered 10 of them in the past week (our FY15 ends 7/31), I hate the process more than most people. But I think this discussion is ignoring the advantages just because we all hate the process. We run the risk of creating a whole new process that we hate just as much as the old process. Because it all boils down to finding an impartial way to evaluate performance and, unless you can crack that nut, your process isn't going to work. Top performers will move on and you'll be left with only under-performers. And that's because humans naturally evaluate their circumstances relatively rather than absolutely, once you get beyond the basics (i.e. can I pay rent and bills). Someone making $100k/yr is going to feel underpaid if someone they feel they're better than makes more. Just because the current system for ranking is flawed doesn't mean that there doesn't mean that ranking isn't necessary.
I'm strongly skeptical that the review process that I've seen various company is any good at helping to make the real connections between employee performance and company bottom lines. In the end, the ranking process of doling out salaries is fooling itself by cloaking the process in numbers.
I can tell because I don't suck at my job. I look at pull requests. I look at ticket completion. I'm with my engineers during planning to know whether people are padding their estimates. I make a note whenever someone steps up in some way (handling emergencies off hours, helping another developer get their work done, etc.) If a manager doesn't understand the work of the people s/he's managing, that manager is unqualified to do the job.
As to your 1), it all depends on what type of culture a company has and how much employees are punished for screwing up. At a company like Facebook, you're expected to "move fast and break things." I'd be very surprised if people were inhibited there. If you're at a bank where screw ups mean someone gets fired, you're probably right.
That sounds very much like "hiring people based on having a reasonable conversation about their experience.” It is a perfectly sane and reasonable system, provided everyone involved is acting in good faith, has a great deal of ability to evaluate people based on their actual contribution to the success of the company, and nobody has any overt or internalized biases.
Without taking anything away from your company, I’m sure you will appreciate that in many companies, this business of “assigning you a bonus based on conversations with the project manager(s)” gets twisted into a horrible political game where people build fiefdoms based on tit-for-tat agreements, and where all sorts of biases come into play, e.g. the men are all “take-charge go-getters,” while the women are all “confrontational and bossy.”
I’m saying nothing about performance evaluations being better, just that results like you have experienced with your company are remarkably difficult to reproduce and sustain.
My bet is that if conversation works in your company, performance evaluations would also work. Maybe with more annoying paperwork involved, but it would still work.
It's important to first think of the active system at play and its influences on people, and second, try to improve it without disconnecting the model from reality.
This is a hard problem, and is one of the reasons leaders and managers need systems thinking skills above all.
[Citation needed]
Also, I find the version with paperwork better, because that creates a documentation trail. If someone is routinely favoring certain people or groups, documentation makes that easy to expose. As opposed to the "word of mouth" system where it's likely impossible.
Ability to understand your specific system and guide it is the far more important factor.
You ask for a citation for an opinion (see: "preferable") then proceed to share your own semi-claim without a citation.
Though probably not intended, saying "Citation Needed" can be off-putting and wastes time in discussions where if you spent a few extra seconds, you could ask a more thoughtful question. For example, your abridged quote has numerous elements and the target of your critique is unclear.
Lighten up!
> Both systems have their downsides. The simpler system generally has fewer...
I merely quoted the remainder to complete the sentence.
It appears simpler at first glance, because the complexity is deliberately hidden. The oft-quoted example concerns “structureless” organizations:
http://www.jofreeman.com/joreen/tyranny.htm
This is not universal, but something to guard against: That the “simpler” system is not, in fact, a structureless environment where manipulative individuals will create an invisible complex system.
Instead we all have to be identical, and our "development plan" is all about getting better at doing things that normally I'd let somebody else take care of, because they will always be better at it than I am. No big raise for me, even though I've saved you two headcount and reduced regressions by a factor of four by improving the dev process and toolchain.
Oh, you're surprised I gave my two weeks?
Most of the grievances in comments here at this point are not so much about the feedback system as about the pay system. There is no mention in the article of "pay", "compensation", "salary", "reward", or any other word talking about the pay system. There is no indication that this is what's being operated on. What is happening is that they're replacing a yearly feedback process with a continuous feedback process.
That's very worthwhile, but it won't solve issues with the pay system, or with politics, or with people "playing the game", etc. It just means that people will have more regular feedback. That's good in and of itself, but it won't suddenly transform the company or turn it upside down.
Now, at the same time, reading this CEO's statement, and comparing it with the sort of stuff that was being said when I was working there, this guy seems positively enlightened. I hope this is just one piece in a pattern of many different things he'll be changing at Accenture. If it is, then there could be large scale change in Accenture.
As it is, this is just one encouraging bit of change around the feedback process. NOT a change of the pay model. NOT something that will get rid of politics in the pay model. NOT something that will majorly change the culture. JUST something that will encourage everyone to operate in the way that good managers (of which there are many at Accenture) already operated.
1. Be super competitive and always aim to be ranked at the very top, to the detriment of working on your technical skills that don't help here.
2. See that the only winning move is not to play and ignore the ranking, focusing instead on gaining experience and forming a long term exit plan.
I saw lots of examples of both tribes but not much in between.
I don't think this will change the mindset internally although it's a positive move. There is a big company culture of not trying to excel at anything for fear of making a mistake and looking bad. The firm is also full of jokers who haven't got a clue about software and don't even think it's a technology company. Lots of politics too.
From (limited) experience this is true for many technology consultants. Unfortunately it's also somewhat common practice for business software projects that involve a small/medium sized software company and a gigantic client that the client requires the involvement of Accure et al. to feel more secure. Sadly it is not uncommon to have the consulting "software experts" do nonsensical tasks just so that they are not touching important stuff.
These days, I am very skeptical about getting involved in any software projects that involve big name consultants.
It depends on what track you choose and what projects you get on, amongst many other things. There are plenty of talented people (at least to begin with) but they tend to get masked by people who would be better suited as contestants on the apprentice.
If you go into consulting and you're even vaguely technical (can write simple software) then you will be very frustrated and will probably end up teaching the start group courses. If you're happy to have your non-technical manager take credit for your work then go for it. Solutions is more technical but doesn't pay as well.
If you're the sort of person that reads HN (which you obviously are) then it is unlikely to be a good cultural fit for you.
Swombat also has experience but I don't know if he'll chip in.
Like all software projects, there are big error bars on all time estimates; it could take X hours or 0.5X hours or 2X hours, even without scope changes. With scope changes, all bets are off. The deal you strike with the client makes this clear - you estimate X hours, but you can bill them anything from 0.5X hours to 2X hours.
If you assign one competent engineer to the project, they'll bill X hours.
If you assign two competent engineers to the project, they'll each bill 0.55X hours for a total of 1.1X hours billed (the extra 0.1X is due to communications overhead)
But if you assign one competent engineer and one incompetent engineer, the competent engineer will bill 0.8X hours completing the project and the incompetent engineer will bill 0.8X hours - for a total of 1.6X hours billed.
In other words, if a project has one competent engineer, adding a competent engineer adds 0.1X to revenue but adding an incompetent engineer adds 0.6X to revenue.
How do you suppose these incentives work out in practice?
Accenture played this game quite well, made for some very unfun working environments for friends of mine. I was lucky enough to work at places that didn't have the big contracting companies when I was doing consulting.
I worked for Accenture for a bit and decided to quit when they would use technicalities to deny promotions. As a matter of fact, I was denied promotions for three cycles because I joined 2-3 weeks too late. Basically, because I joined the firm 2-3 weeks after the big yearly review, I wasn't eligible for any promotion for two years whereas if I had been given a start date a month earlier I would have been eligible after a year.
I left and more than doubled my salary, work on newer technologies, largely in charge of my own schedule, can work anywhere in the world, and received promotions faster.
Maybe I'm fooling myself and I really am narcissistic. But my feeling is that it's not narcissism but simply a rational adaptation to the conditions. What I do when you put a self-review form in front of me, is similar to what I do as a musician when you put some sheet music in front of me: Play the notes and try to make the audience happy.
My boss accepts my all-positive self review, and then reminds me that I have to add two negatives, because it's mandatory. I choose negatives that are completely bland.
What it means is that dealing with my weaknesses is not part of the annual review process. But I'm free to engage in as much introspection as I want, and my boss is welcome to chat with me about it at any time. On the other hand, I might choose to keep some of my weaknesses to myself. Working through my own shortcomings is something that might be a rational choice. And there's such a thing as too much information. ;-)
I worked for Accenture, as well as its first incarnation Andersen Consulting, and in my experience the reviews that really mattered were the so-called role reviews. Roles are jobs at a client. Every role reports to a more senior Accenture employee who assigns scores as a judgment on performance. The annual review, held with one's career counselor, is a chat largely about the scores assigned to one from roles in the current year. The scores from roles add up to a number and that number is essentially the annual review.
In this policy change, Accenture is simply removing a useless impotent non-position. It does nothing to curb the recency effect, for example, pernicious in the role review. That said, Accenture's process is more enlightened than most approaches to the formal review.
Good relationships, be it professional or otherwise, are based on effective communication. An ongoing conversation between managers and their reports is the best way for a manager to know what is going on and be connected, and for an employee to feel heard and in-touch. This conversation must be continuous and embrace all aspects of a employee-manager relationship.
I've been working for over three years on a service called 15Five which is a tool for such communication. It is neat to hear how people use this service in their organizations as an alternative to annual reviews.
I feel there is a growing shift away from quantified annual reviews and into more conversational feedback loops.
if the industry really wants to transform performance, pay them out monthly or quarterly
The real answer is, they dont want to. In fact, I suspect you will see an industry trend to disband performance bonuses for all non C-level employees over the next 5-10 years.
I doubt that. Bonuses are basically a portion of an employee's salary that can be rescinded at the company's whim. Employees won't simply start working for less, so eliminating bonuses would remove the company's ability to give more during the fat years and less during the lean years.
Terming them bonuses is actually wrongheaded, considering employees expect to get that money. Bonuses are on the offer letter...it's not like people show up their first day after accepting the offer and are told, "by the way, you'll get $X/yr bonus." They're actually concessions made by the employee during the negotiation phase to give the company flexibility over a portion of their salary. And I doubt we'll see companies want to give up that flexibility.
Being criticised by a colleague for something they've failed to bring up until now is a sign it clearly isn't that serious. Having a manager sit on negative feedback until the review is a sign of a very bad manager. In both cases I'd be pushing strongly back.
The trick is having constant feedback. Weekly, bi-weekly, or even monthly review-like events allow both the employer and employee to share wins and discuss areas of friction. Having lots of such mini-reviews allows for quicker resolution and prevents things from boiling up.
Fantastic managers do this intuitively and do not need instruction or tools for it.
Can confirm, both employees that receive good score but not excellent and average score not good are demotivated.
Only the excellent minority is motivated.
Surely a minority of the excellent minority that 1) get recognised as excellent and 2) are motivated by such recognition.
A good manager should know what you're contributing without this kabuki theater.
I still felt demotivated by the whole process, because it was a forced ranking of the system that wasted the whole teams time to say what everyone had already known: some of us did more work, some of us did less, and some of us were on a faster upward trajectory than others.
It turns out that it doesn't actually motivate any of your employees to throw social hierarchies in their face -- it only causes tension and undue focus on micro-social hierarchies (those heiarchies within a social class, eg, the hierarchy of entry level tech workers).
If your employees leave you in two years max anyways, excuse or no excuse, there's not much point having this excuse.
Perhaps Profit Sharing is the better angle? At ZoomInfo, each quarter everyone gets a bonus based on the company profits of the quarter, distributed ~equally. If every everyone did a great job and company did well, everyone gets a bigger bonus. Not as great for the rockstars, but it's an incentive for everyone to work together. Of course, if the market is down, it will fail to incentivize people working their asses off to keep the company afloat.
Have heard that, in the new model, your manager gets a lot more liberty in deciding how to distribute the appraisal budget for the team instead of the hikes simply following a company-wide rule depending on the employee's rating tier.
Not saying this will fix all the problems (inept management is a reality that exists in any organization of size) but it at least shows that top brass understands that the current system isn't working.
I think it's well worth a read, especially if you're implementing or in a position to influence these sorts of processes.
Feedback is important, but once a year/half/quarter isn't really doing it. And ideally it shouldn't be related to what you're paid, though that's harder to convince people. It can work though, and the book provides some examples of alternatives.
I won't work for IBM again because I've experienced their insanity, but I know people who were happy there; I wouldn't recommend Accenture to anyone, literally including Hitler.
For a given job, not all _people_ will get the same pay, and as individuals, a particular man and a particular woman may not make the same, but across an organization we should find some balance, there should be women who make more than some men, etc..
I don't think anyone wants a situation where granting any individual a raise means that everyone with similar responsibilities (no two people 'do the same job') gets the same raise.
But as I type this, it's clear how all of this grey area can (and surely IS) be leaned upon to maintain the status quo.