Tom Edison in Human Resources mentioned the other day that he has been working some 30 years on getting the Shell rating system right and it still isn't there yet. As an employee I must fully agree, it is not just. Why not ask the question why? My guess is that it will never be right as long as it exists in the context of "management control". Employee rating/ranking is one of the most sacred sources of control exercised by our managers. The company no longer even asks what the fundamental goals of a review process should be. I take the liberty of suggesting perhaps what those goals should, and should not be:
1. The review process should try to identify, as early as possible, those problem performers who drag the company and should be let go. Bottom line is that there are few if any in that category left.
2. The review process should try to identify those who possess that combination of skills, authority, aggressiveness, or whatever it is that makes a good LEADER. The process should seek to find those who will lead the company at the very highest levels. Also keep in mind that good managers do not necessarily make good leaders, that management and leadership are NOT the same thing, and that we are most definitely NOT ALL leaders.
3. The review process should NOT attempt to quantify minute subjective differences in annual performance. In the first place that is simply not possible. I have spoken to any number of Shell managers who insist that they can indeed see differences. In so far as they actually believe they can then perhaps they are not lying, but I simply reject the notion. Were it true, Tom Edison's quest would have ended years ago. Secondly, I ask why? Why does it matter anyway? (Beyond an annual exercise in feeling in control). Every employee is needed or else see statement 1 above. If the company truly believes in teams then rating/discriminating on individual performance becomes counterproductive to stated company policy.
So, here is my proposal:
1. Remove the fluff questions from the 360 feedback form and include questions which seek to identify leadership ability. (for the proper questions, forget the consultants, talk to a university psychology professor, or several).
2. Require each employee to have a certain minimum number of forms to make the process useful and valid.
3. Instead of keeping the 360 feedback apart from the rating scheme as is now proposed, I recommend the rating scheme be based SOLELY on the 360 with NO management input. That is, I am proposing to completely remove the control managers so dearly desire. Naturally, any system can be abused and proper auditing mechanisms need to be included to insure no funny business on the part of employees. (Acknowledging that we are not all angels either). Still, trust the employees to select who is tops, you certainly can't do any worse that what we have now.
4. Based on the results of the 360, employees should be binned into the top 15%, and next 85%, or next 75% and bottom 10% if justified. Salary administration will be based on rating, grade, time in grade, and company/unit performance (ICP). Promotions based on time in grade with adjustments such as a one year acceleration for each year with top rating.
5. New managers are still selected by management, but from the pool of top employees thus breaking the "old-boy" or sponsorship network which has so poorly served Shell in the past.
Success in life naturally builds confidence and self-satisfaction. It is both useful and necessary for each of us. Still, in terms of corporate structure it can be counter-productive as well. In our confidence and self-satisfaction we naturally judge the world from our personal experience. We choose and reward others in the same way, those who look and think a lot like ourselves. We in fact recreate the company in our own image. This process neither guarantees success nor causes failure. While neutral on the surface, it does provoke several problems: it creates glass ceilings for those without the expected "look and feel", it limits diversity, especially at the management and corporate level, and it blocks new ideas and openness to change. Let the employees tell you who is best. Just because management does not take a hand in the rating will not mean that poor people are progressing. Just because an individual does not look or think like "you" does not mean that person will do poorly, just differently.. which is what diversity is all about, what change is all about.
My proposal seeks to identify quality and leadership without recourse to cronyism. It removes much of the negative control now exercised by arrogant individuals. It rewards teamwork as well as performance, and gives an audible salary administration.