In an article in this month’s Harvard Business Review
Lori Goler, Janelle Gale and Adam Grant mention how “performance reviews are
awkward. They’re biased. They stick us in boxes and leave us waiting far too
long for feedback. It’s no surprise that by the end of 2015, at least 30 of the
Fortune 500 companies had ditched performance evaluations altogether,” (p.92).
I don’t fully agree with their comment about the link
between feedback and performance reviews – as I think they are mutually
exclusive and that whatever your approach to performance reviews, feedback
shouldn’t be something you have to wait ‘far too long for’ and should be a
regular event occurring on a weekly/monthly basis where the employee sits with
their immediate boss on an one-on-one basis for a honest and forthright
discussion about what’s going well; what isn’t (if anything); areas where
improvement could be made (which might lead to development needs) and what’s
going to happen in the next ‘period’ of time.
Feedback is different to ‘acknowledgement’ where
acknowledgement is or should be immediate following a ‘job well done’ and where
feedback is a more formal regular event. Feedback isn’t just the responsibility
of leaders, it’s also the responsibility of employees to seek feedback – so if
you aren’t getting feedback on a regular basis it’s your responsibility to ask
What’s true is where Goler, Gale and Grant highlight how
“as researchers pointed out in a recent debate in Industrial and Organizational
Psychology, ‘Performance is always rated in some manner.’ If you don’t have
formal evaluations, ratings will be hidden in a black box.” In today’s world we
are rating ‘things’ all the time, virtually instantly, and ‘performance’ isn’t
any different. But how we ‘rate’ and what we do with this ‘rating’ defines good
leaders, from poor leaders (and good organisations from bad ones). If you don’t
have formal evaluations then you shouldn’t be hiding your ‘tendency’ to rate in
a black box – you should be totally transparent with your ‘black box’ and this
is done through regular transparent feedback. ‘Black box’ mentalities lead to
distrust and demotivation within the team, where there is no chance of honest
feedback taking place and employees find themselves in a ‘toxic’ environment.
Goler, Gale and Grant mention how “we all want
performance evaluations to be fair. That isn’t always the outcome, but as more
than 9,000 managers and employees reported in a global survey by CEB, not
having evaluations is worse. Every organization has people who are unhappy with
their bonuses or disappointed that they weren’t promoted. But research has long
shown that when the process is fair, employees are more willing to accept
undesirable outcomes. A fair process exists when evaluators are credible and motivated
to get it right, and employees have a voice. Without evaluations, people are
left in the dark about who is gauging their contributions and how.”
The reality is that performance evaluations simply aren’t
‘genuine’ performance evaluations if they aren’t honest and transparent. All
the talk about ‘black boxes’ etc doesn’t belong in the same sentence as
performance evaluations; and it’s because they now seem to appear in the same
sentence that performance reviews have become misunderstood and gained a bad
reputation – but it isn’t the concept of performance reviews that is bad, it’s
the people that have misused them for decades that have made them bad.
Goler, Gale and Grant highlight how “at Facebook, to
mitigate bias and to do things systematically, we start by having peers write
evaluations. They share them not just with managers but also, in most cases,
with one another – which reflects the company’s core values of openness and
transparency. Then decisions are made about performance: Managers sit together
and discuss their reports face-to-face, defending and championing, debating and
deliberating, and incorporating peer feedback. Here the goal is to minimize the
‘idiosyncratic rater effect’ – also known as personal opinion. People aren’t
unduly punished when individual managers are hard graders or unfairly rewarded
when they’re easy graders.”
Two of the authors of the article are from Facebook, Lori
Goler and Janelle Gale and though it’s good that they are trying to use
performance reviews effectively, it’s sad that they think they need their own
‘theory’ to mitigate ‘bias’ – as there have been tips and tricks on how to
mitigate performance review bias for decades. One of the simplest, wasn’t to
rate performance on an annual basis in the first place it was to give regular
reviews based on a ‘management by objectives’ approach. This professional
approach meant that ‘performance reviews’ linked with regular ‘feedback
sessions’ to form a constant review of performance that didn’t leave employees
in any doubt about how they were doing; and became a seamless ‘performance
review’ that left employees motivated, engaged and inspired to over-achieve
against their objectives on a continuous basis.
Goler, Gale and Grant state that “many companies that are
abandoning performance evaluations are moving to real-time feedback systems.
That is an excellent way to help people repeat their successes and learn from
their failures. But it doesn’t help them – or the organization – gauge how
they’re doing overall.” Again I have to totally disagree with their statement
that ‘it doesn’t help them gauge how they’re doing overall’ and to me the
statement sadly shows a misunderstanding about managing performance, reviewing
performance and the art of ‘feedback’. Done correctly there is no doubt in the
employees mind about ‘how they’re doing overall’ – and it’s scary that a
company like Facebook could be so confused and misinformed about what regular
performance feedback is all about.
The most important aspects of ‘great’ performance
feedback is that;
It should be a regular, formal process.
Leaders and employees should be ‘trained’ in how to give
and receive feedback – a skill that is rarely taught and hence where many of
the problems start;
Feedback is specific, constructive and makes a real
Feedback is genuine and honest, discussed in a ‘safe’
environment - which only exists in great organisations, with great leadership
and a strong culture of transparency;
Feedback is based on specific objectives that leads to
performance improvement and development needs as and when necessary;
The employee learns how to receive feedback in a
constructive and not a defensive way; and to seek clarification from the
feedback in a positive way, that makes a difference to their performance.
If you give regular feedback in the right way, you won’t
need to only ‘rate’ your employees once a year; as through regular, honest feedback
all your employees will be performing at their optimal level of performance
balanced between the organisations ‘present and future needs’ – it’s a genuine
win-win for everyone. So let’s take this opportunity to go back to basics;
teach our leaders and employee’s how to give and receive feedback; and get back
to giving regular, honest feedback to our employees – it will make a huge
difference to the employees and the organisation.
Goler, L., Gale, J. and Grant, A. (2016). Let’s Not Kill
Performance Evaluations Yet. HBR, November, p.90-94.
Having someone in your business life who inspires you to
succeed and achieve your goals seems to be the exception than the rule these
days. I still remember the managers I had early in my career who were truly
inspirational and in no small way helped me create the solid foundation on
which I was able to build my career.
Talking to thousands of employees over the last 40 years
there’s no doubt about how much difference an inspirational leaders makes – not
just to the employees level of commitment and motivation – but the impact these
leaders have on improving and optimising organisational performance, as they
help create a culture that wants to ‘over achieve’ in areas that are
synergistic to the employee and the organisation – creating a win-win for
So it seems sad that in the early years of the 21st
century, today’s leaders seem to lack the basic skills needed to inspire employees
and further seem to lack the desire to inspire them in the first place. Many
leaders seem to look inwardly rather than outwardly – putting themselves and
their career path and ‘status’ before anything else – possibly fearing that
they might lose control of their ‘own’ future and that others may excel and be
noticed more than them.
Yet the inspirational leaders I worked with had both –
successful careers and created successful careers for those around them. Rather
than being fearful of others excelling, they embraced it and were recognised
throughout the organisation for their success in taking their
department/organisations to new levels of excellence. These ‘new’ levels of excellence
and the inspirational leadership style created yet further incremental increases
in performance that could be tracked to the bottom line.
In 2013, after interviewing over 100 HR professionals in
the US, research by Keas, a company that focuses on employee health and wellness,
found on one question - “in your experience, what are the top three Human
Resources mistakes that every CEO makes?” - that the top-scoring three
64% – leaders don’t recognize what truly motivates
41% – leaders fail to lead by example
32% – leaders don’t make company culture a priority
Where all three of these actions (or non-actions) send a
loud, clear message to employees: you are not that important to me, (Anderson,
Just the fact that 64% of leaders don’t even recognize
what truly motivates employee’s highlights today’s problems around
inspirational leadership. It’s a fundamental requirement of a leader to know
their people and especially what motivates them. These are basic conversations
that usually take place at the ‘interview’ stage and then on a regular basis
each and every year after that.
This is then backed up by the next two traits – ‘failing
to lead by example’ and ‘not making company culture a priority’. It seems that
many leaders today see themselves ‘above’ those that work for them and hence
don’t see a need to lead by example. They are the boss, they have the power – “you
simple exist to do my bidding”. In fact it wasn’t that long ago I heard a
leader define their staff as “people whose job it is to make me look good.”
Leadership seems to be going backwards – partly because
the inspirational role models that exist out there in the global economy don’t
even see the light of day. Where the media is obsessed with reporting
‘negative’ behaviours these days and seem to fail to grasp the need to show
future generations ‘positive’ behaviours in the work place so they can see the
benefits early in their lives and might even be positively rather than
Whether we want to openly admit it or not – we all want
to be led by an inspirational leader – as if nothing else they make our jobs so
much more enjoyable and give the opportunities for us to challenge ourselves,
if we want to.
In 2013 IBM asked 1,700 CEOs in 64 countries, “what do
top executives want from their leaders?” The three leadership traits that most
mattered were; (1) the ability to focus intensely on customer needs, (3) the
ability to collaborate with colleagues and (3) the ability to inspire. (Zenger
and Folkman, 2013).
Zenger and Folkman’s research found that “some of what
(inspirational) leaders did was specific and tangible. For example, they set
stretch goals with their team. They spent time developing their subordinates.
They engaged in highly collaborative behavior. They encouraged those about them
to be more innovative.”
Other things Zenger and Folkman identified were somewhat
less specific and less tangible, yet are probably the real traits that make
them stand out of other wannabe inspiring leaders; where “these inspirational
leaders were more adept at making emotional connections with their
subordinates, for instance. They were better at establishing a clear vision.
They were more effective in their communication and willing to spend more time
communicating. They were ardent champions of change. They were perceived as
effective role models within the organization.”
What I’ve found during the course of my career is that
inspirational leaders embrace the following key behaviours and traits;
1) They ensure that making time for meeting with their
employees, one-on-one, on a regular basis is their number one priority;
2) They are visionaries and have the ability to communicate
these visions in a transparent and compelling narrative, that inspires their
employees to want to be part of the journey;
3) They are ‘big picture’ focused and can look beyond their
own department or organisation; and see short and long-term opportunities;
4) There have experienced life to the full (both business
and personal); and have usually experienced both significant ‘ups’ and ‘downs’
but learnt real life lessons from both;
5) They are principled role models; and never ask people to
do things they would never do themselves;
6) They are passionate – not just for the future of their
organisation – but passionate about all their employees too, knowing that you
can’t have one without the other; and finally
7) They are both patient and excellent listeners.
It’s up to today’s executive boards to embrace
inspirational leadership at the top and then ensure these basic behaviours role
down the leadership pipeline and become an integral part of the organisations
It’s not complicated or rocket science – we just need to
bring inspiration back to the work place. The benefits will gleaned by all
Anderson, E. (2013). 3 Simple, Powerful Things Leaders
Can Do To Inspire People To Do Great Things. Forbes On-Line, August 29.
Zenger, J. and Folkman, J. (2013). What Inspiring Leaders
Do. Harvard Business Review On-Line, June 20.
As we continue our journey into the 21st Century are global businesses setting higher standards for themselves or are
they becoming more selfish and greedy?
If the latter – maybe we should be asking some basic questions
on social media and elsewhere to try and get some substantive change. For
example, who gets to set the rules in business? And how well are they doing
their job? What values should these rules reflect? What’s fair and how is this
defined? And what, if anything, do we owe to one another?
The 21st Century has seen large global brands
being caught misleading their customers for financial gain. The global
financial crisis was a tough time for most consumers across the world, who must
have been saddened (and more) to find that many of the financial institutions
they trusted to look after their hard earned cash were misleading customers or
had colluded to make financial gain through for example rigging forex rates.
More recently we had the Volkswagen (VW) emissions cheating scandal allegedly brought about
when VW realized that a new generation of diesel motors could not meet United
States air quality standards legally. The company officially admitted the
cheating to regulators, but not to the public, on September 3, 2015, after the
E.P.A. threatened to refuse to allow 2016 models to go on sale.
the documents reviewed by The New York Times, a confidant of Mr. Winterkorn
(the Chief Executive of Volkswagen at the time), wrote to him in May 2014,
warning that regulators might accuse the carmaker of using a so-called defeat
device - software that recognized when the car was being tested for emissions
and activated pollution-control equipment. At other times, the cars produced up
to 35 times the allowed amount of nitrogen oxide emissions, which are linked to
lung ailments and premature deaths.
1, 2016 the Australian Competition and Consumer Commission (ACCC) sued
Volkswagen AG (VW) and its local subsidiary for misleading customers. The suit
alleges that VW engaged in misleading or deceptive conduct, made false or
misleading representations and engaged in conduct liable to mislead the public
in relation to diesel vehicle emission claims. Specifically, the ACCC claims
that between 2011 and 2015 VW misled customers in relation to the significantly
higher nitrogen oxide emissions being produced by the vehicles, misled
customers to believe that the vehicles complied with Australian and European
standards and all Australian regulatory requirements, and marketed the vehicles
in Australia as being environmentally friendly, clean burning, low emission and
compliant with stringent European standards when this was not the case under
normal driving conditions. The ACCC claims that this constituted multiple breaches
of the Australian Consumer Law. The ACCC is seeking declarations, pecuniary
penalties, corrective advertising, findings of fact and costs.
7, this year Bloomberg Business Week asked the question “can ExxonMobil Be
Found Liable for Misleading the Public on Climate Change? Where it’s alleged
that scientists at the biggest U.S. oil company understood as early as anyone
that fossil fuel emissions were heating up the earth’s atmosphere. The world’s
largest oil explorer by market value had been hit by a pair of multipart
investigations by InsideClimate News and the Los Angeles Times. Both reported
that as early as the 1970s, the company understood more about climate change
than it had let on and had deliberately misled the public about it. One of
Exxon’s senior scientists noted in 1977 - 11 years before a NASA scientist
sounded the alarm about global warming during congressional testimony - that the
most likely manner in which mankind is influencing the global climate is
through carbon dioxide release from the burning of fossil fuels.”
there’s Wells Fargo.
Two former Wells Fargo & Co employees have filed a
class action in California seeking $2.6 billion or more for workers who tried
to meet aggressive sales quotas without engaging in fraud and were later
demoted, forced to resign or fired. The lawsuit on behalf of people who worked
for Wells Fargo in California over the past 10 years, including current
employees, focuses on those who followed the rules and were penalized for not
meeting sales quotas.
"Wells Fargo fired or demoted employees who failed
to meet unrealistic quotas while at the same time providing promotions to
employees who met these quotas by opening fraudulent accounts," the
lawsuit filed in California Superior Court in Los Angeles County said. Wells
Fargo has fired some 5,300 employees for opening as many as 2 million accounts
in customers' names without their authorization. On September 8, a federal
regulator and Los Angeles prosecutor announced a $190 million settlement with
If the fraud isn’t bad enough it’s worth highlighting
that institutional investors now want Wells Fargo to reclaim money it gave to
Carrie Tolstedt - the executive who oversaw the Wells Fargo unit during the
time it carried out a massive fraud. Tolstedt resigned earlier this year with a
$124 million severance payment, plus equity.
One can sadly
Google many other organizations misleading the consumers in some form or other
– which begs the current question – who’s setting the rules of business? As
individuals ‘we’ have two simple choices – we can either turn a blind eye to
forms of corporate corruption and greed and thereby tacitly approving these bad
practices, which at a minimum are ripping us off and at worst will destroy the
planet – or we can start to ‘fight’ and stand up for the world we want our
children and grand-children to inherit from us.
If we’re going
to put our heads in the sand thinking ‘I have no power to make a difference; I
don’t drive a VW or bank with Wells Fargo; or I don’t know what to believe
anymore so I just won’t get involved’ – then sadly we’re accepting that it’s
okay for businesses to cheat, lie and be focused on selfish greed. In which
case why don’t we start teaching our kids the skills required to be good at lying
and corruption - as we might as well ensure our future businesses and
associated nations are best equipped to maximize this apparent tacitly
‘acceptable’ approach to business.
The business ‘buzz
words’ of the past few decades have focused on leadership development;
corporate governance and corporate social responsibility – in fact many
organizations are making millions of dollars supposedly ‘developing’ these
importance areas of business.
businesses are corrupt – then it’s the fault of their leadership; their
corporate governance and their approach and belief in corporate social responsibility.
One of the key
rules of business should be to have stringent corporate governance rules in
place to ensure the organization is operating at the highest ethical standards,
for the good of their stakeholders, their community and when appropriate the
planet; for organizations to embrace and genuinely understand the long-term and
sustainable benefit of corporate social responsibility; and to have the right
leadership in place to ensure these first to rules are upheld each and every
organizations cheat – then the leadership must be held to account and be held
personally liable to their stakeholders.
happens we are sadly allowing and tacitly approving greedy corporations and
institutional investors to make a mockery of the concept of leadership and the
accountability that comes with it – and taking the principled role of leadership
back to the dark ages.
There’s a great quote by the author Simon Sinek, who
wrote, “a team is not a group of people who work together. A team is a group of
people who trust each other.” There’s nothing mind-blowing about this quote on
the surface – but how often do teams spend real quality time assessing their
genuine cohesiveness? And who’s the right person to be ensuring they have the
best performing team, where each member trusts the other, both today and into
Trust is a huge issue and not something that can be
assessed accurately unless, to some extent, trust already exists within the
team. Confused? It’s a bit like the chicken and egg. It’s unlikely that you’ll
ever really know if you have a truly high performing, trusting team if the team
doesn’t operate in a culture where full transparency is the rule and not the
exception – and for transparency to exist you first need at least some degree
of trust to be present or a genuine desire to get to a point where the team can
trust each other.
The general rule in most organizations seems to be to
ignore this part of team dynamics and just let the group sort out their
problems if and when they arise; tacitly accepting that not everyone is going
to get on and allowing levels of dysfunctionality to exist – without fully
understanding the impact on team performance and hence optimum output. In fact
it seems that unless the underlying mistrust starts to negatively affect
short-term performance goals, the problem will be ignored, in most cases,
simply because leaders don’t have the confidence and skills to deal with it.
This approach fails on so many levels (1) you’ll never optimise
your teams true potential; (2) individual team members will not support their
colleagues above the very basic level; (3) the team will not innovate best in
class solutions due to the distrust among its members; (4) ‘underground’ splits
occur in the team where often one section thinks they are superior to another
part of the team and gain favour with the leader, creating messy silos of
distrusting self-serving sub-teams.
Another sad fact about dysfunctional teams are that they
are the playground of command and control type leaders. These leaders thrive on
their team being dysfunctional as it gives them more power to manipulate the
business environment for their own personal gain. They have absolutely no
interest in developing a cohesive team, as they fear losing their own slightly
misplaced perception of control. Further they do not subscribe to one of the
core roles of a leader that being to develop each team member to their optimal
potential – as they fear this may threaten their very existence.
So how does one reverse this trend? Here are some
1) You have to want your team to be the best they can be?
2) You want an authentic team where honesty is a core value
– which leads to a trusting environment (note: genuine honesty can be hard
initially as team members hear the truth about how they are perceived, often
for the first time and their ego’s get dented; but in the medium to long term
the team, through focused leadership, get over themselves and focus on a honest
3) You’re prepared to invest the time to build a successful
4) You set ground rules so you create an authentic
environment, not a bitchy one.
5) You focus on the benefits of building the best team of
highly motivated individuals.
6) You’re prepared to set the example.
So the starting point is for the board and executive team
to ensure that they develop a leadership philosophy that rejects any form of
command and control leadership; and they set the example to encourage leaders
to develop high performing teams as a core responsibility. This means that as a
leader you must be prepared to deal with team dynamics head on and be prepared
to invest time and effort in developing a culture of trust – however hard that
might be in the short term – as failure to develop a team that trusts each other
means you will have accepted mediocrity as one of your core business values.
As Patrick Lencioni, author of The Five Dysfunctions of a
Team, wrote; “remember teamwork begins by building trust. And the only way to
do that is to overcome our need for invulnerability.”
Besides reading the theory on team dynamics, business
leaders can learn a lot from observing the best sports teams around the world where
for example Phil Jackson (former coach and former player, currently serving as
president of the New York Knicks) said “the strength of the team is each
individual member. The strength of each member is the team.”
One strength of great sports team is their authentic
communication – it’s one of the things that makes them stand out from the crowd
of wannabe teams where, as the author Michele Jennae states “if we don’t
communicate, we certainly can’t get much done and if we don’t communicate
authentically, what we get done is less effective.” Players on and off the
field are authentic about their strengths and weaknesses; they understand their
primary team role; but are also prepared to support other teams mates as and when
necessary – they know that if their communication isn’t authentic, the team
will not play to its best potential and they won’t be the best.
It’s worth noting from a business perspective that this
sports analogy isn’t saying the ‘dysfunctional’ team might not win – it just
won’t win by the margin it could if it was working together as ‘one’ cohesive
unit. And this is often where the confusion exists for the business leader –
they see their ‘team’ winning and hence assume that things must be ‘good’ and
don’t get involved enough in the team dynamics to understand that the winning
is more ‘luck’ than due to the team ‘playing together’.
So it’s your choice as a leader, are you confident and good
enough to truly examine your team dynamics to find out if you have an environment
of transparency and genuine trust; and are you prepared to invest time and
effort in developing the best team dynamics possible?
Remember “leadership is not about your ambition. It is
about bringing out the ambitions of your team” ― Cheryl A. Bachelder, Dare to
Serve: How to Drive Superior Results by Serving Others
About the book "Be the Best in Business" by Nigel Brownbill
"The author not only challenges you to be 'the Best' but shows you the way in a very concise, thoughtful and practical way. He skillfully blends his vast business experience with sharp academic insight to create a compelling guide for long-term sustainable business success."
Professor Brad Jackson Fletcher Building Education Trust Chair in Leadership The University of Auckland Business School
2nd Edition of 'Be the Best in Business' for Kindle Published 10th August 2012
"This book is an invigorating treatment of principles fundamental to the success of any business enterprise. It is also a powerful 'call to arms' in that it challenges us to move on, from institutionalised practices that masquerade as 'modern', to embrace standards that will 'raise the bar' and differentiate the best from the mediocre!"
Managing Director, Camford International Limited and former Vice Chairman, IIC Partners Executive Search Worldwide